Asia is facing an economic downturn – and the slowdown has already started. Consumer confidence and spending are declining across the region and this trend is predicted to continue. It seems certain that brands will face more testing times – and not all will survive.
The Harvard Business Review estimates that 17% of businesses don’t make it through recessions – and 85% of those that were growth leaders going into a downturn had been dethroned by the time the economy recovered. The decisions that Asian businesses make over the next few months will be critical ones. The trouble is that the instinctive reaction businesses have to tougher economic times is usually the wrong one.
During a downturn, survival often depends upon cutting costs – but it also depends on continuing to spend in the right places. Kantar TNS’s research into consumer attitudes during the global recession proves that finding growth in an economic downturn provides fertile ground for innovation – and businesses that able to focus their innovation efforts in the right direction are usually those that ride out a downturn best.
Ray Crook investigates the myths behind consumer behaviour in an economic downturn and the platforms for ensuring success.