Consumer spending, a critical indicator of the economy’s health, was upended over the past year. Almost overnight, consumers were forced to dramatically change their behavior, and as a result, companies had to transform business models. This meant adopting and implementing new processes and technologies quickly, all to continue to serve consumers as best as possible. It is now time to plan for the coming consumer demand recovery.
Now, after more than a year of business closures and restrictions, consumer confidence is ready to return to ‘normal.’ As restrictions continue to be lifted, shoppers will return to the things they enjoy. Business owners need to be ready for a massive consumer return. To be most successful, business owners must have a plan for this coming consumer demand recovery.
What is an economic boom?
An economic boom is a period of rapid economic expansion, generally marked by significant GDP growth, increased productivity, and lower unemployment. The cause of a boom is an increase in consumer spending. An economic boom may also be referred to as an upswing, upturn, or growth period.
The Economy is on an Upswing
There are many reasons to believe the economy is headed for a growth period, but Gross Domestic Product (GDP) growth is certainly at the top of the list. GDP, a key indicator of an economic boom, not only increased in the fourth quarter of 2020 at an annual rate of 4.3 percent for the nation but is expected to continue to grow throughout 2021 and even into 2022. In fact, the GDP is forecasted to grow anywhere from 6.5% to 7%.
In terms of an economic boom, an annual GDP growth of 6.5% would make 2021 the strongest year of growth in over 30 years. Consumers, who were spending more on goods during the pandemic, are now reinvigorated and ready to spend a growing income on services as well.
In addition to growing GDP, the Federal Reserve estimates the unemployment rate will fall this year. Lower unemployment, much like growing GDP, is another indicator of a coming economic boom.
Leading the Economic Recovery with Purpose
As doors reopen, schedules open up, and business increases, what will really make a difference for companies is how leaders approach consumer demand recovery. Organizational leaders have a defining role to play in steering their companies to success throughout the recovery.
Stay ahead of your competitors, and make the most of the economic recovery by having the right plan. Concentrate your recovery efforts and drive business growth by focusing on these four areas:
#1 Continued Focus on Innovation
Digital transformation was a driving force in helping businesses during the past year, and it will continue to be a determining factor moving forward. To adapt to changing circumstances, businesses accelerated their digital transformations, and now consumers have become accustomed to more virtual and online experiences in industries spanning from healthcare to grocery stores. A focus on innovation will help businesses stay competitive throughout this dynamic time period.
#2 Increase Multichannel Marketing
While consumers are rushing back to stores, they are also navigating between channels more than ever before. Companies need to meet shoppers where they are, combining both offline and online interactions, to create a seamless customer journey. In your multichannel marketing plan, make sure you include a combination of communication channels that include a website, email, direct mail, and directory listings, among other channels.
#3 Maintain a Growth Mindset
Economist Paul Krugman once said, “Productivity isn’t everything, but, in the long run, it is almost everything.” Part of a strong economic recovery is strong productivity growth. For businesses, it’s important to stay on top of shifts in consumer behavior and have the ability to quickly respond to these changes. Business leaders impact organizational culture, and they play a major role in the productivity of the company. That means that business leaders have a particular opportunity to shape the future of their organizations moving forward.
#4 Customer Service
Finally, don’t forget about the importance of customer service. Businesses may look to reconnect with customers as they come back into their stores and offices. You can’t underestimate the impact of a free gift or an offer of loyalty to rebuild customer rapport.
Capitalizing on the consumer demand recovery will require taking a combination of actions, and what those specific actions are will depend on each company’s unique situation. At Safeguard, we know that with the right products, services, and planning, your business can be even more successful moving forward. Talk with a local Safeguard Advisor who will learn about your unique goals and then help you with personalized solutions that fit your business. Call 855.778.3124 to get started.
- After more than a year of business closures and restrictions, consumers are ready to return to ‘normal.’
- There are lots of reasons the economy is headed for a growth period, including GDP growth and lower unemployment.
- Organizational leaders have a defining role to play in steering their companies to success throughout the consumer demand recovery.
- Concentrate your recovery efforts and drive business growth by focusing on innovation, multichannel marketing, and maintaining a growth mindset.
- You can make the most of the consumer demand recovery with personalized solutions from your local Safeguard Advisor.