The Psychology of Recession part 1
Must depression lead to depression?
An old acquaintance popped the question “How’s business?” He’d never asked this before. He’d never even shown any interest in my businesses. Just for a second, I considered answering, “Oh, it’s terrible. I had to sell the house. And as for my staff, it’s just too bad.”
Instead I told the truth: that my IT company has just had its best quarter (and best month) ever, and now I’m getting going on the strategy and marketing consultancy, that’s looking very promising too.
So what answer was my friend expecting - or hoping for? Part of me feels that traditional English reserve demands the “fine, considering!” response from anyone whatever the circumstances. Or was he influenced by the outpouring of misery in the media - mainstream and new - into requiring his own personal examples of recession troubles?
I don’t really know the answer, and I’m not convinced a trained psychologist could help either. I do know that evidence of recession is everywhere - the toothless gaps on the high street are already becoming a cliché. But this is the first big recession in this new age of pervasive group-think. The thought occurred to me that SurviveTheRecession.co.uk might be part of it. No. I’ll keep positive and talk about surviving and flourishing.
As I thought about my friend’s question, I started to see examples of the accepting-recession pysche everywhere:
- retail staff slacking and assuming their bosses would blame the recession
- public sector workers gleefully increasing their sickies
- ditto private sector
- teachers all-too-easily allowing their schools to close - blaming health-and-safety in the snow
- wild price-cutting in stores (not sure that will boost confidence)
- cinemas full to bursting (at least here in Oxford)
In business there’s a general nervousness. For good reason if the behaviour of the banks in anything to go by. Our various advisors are telling us to delay payments as long as possible. Sounds like good business practice - but our customers get the same advice. Result: everyone’s cashflow is put under extreme pressure.
I’m interested in the ways this psychosis (is that what it is?) will affect behaviours long term - in business, in society. In keeping with my survival mission, I’ll look out for positive effects on the psyche.
- will there be a retreat to safety as fear is expressed? Big brands succeeding?
- signs of much more helpful service staff eager to help their businesses succeed (or just to keep their jobs)?
I must go back to speak to my friend to ask what answers to the “how’s business” question he’s received.
More anon.
February 12th, 2009 at 07:25
Interesting idea of big brands succeeding as part of the route to safety. My own view is that smaller brands have greater potential. Why? Simply because many people perceive the big brands (HBOS anyone?) got us into the mess in the first place. That’s leading them to start looking for smaller, niche brands that they can have more of a relationship with. And, after all, the big brands may appear to offer the sort of cuddly flexibility that many consumers are after - but how many really offer it without shoehorning their customers into pre-programmed customer models? I think it’s personal relationships over faceless brands every time at the moment.
February 13th, 2009 at 10:23
in my own personal purchasing life, I tend to agree with you and will hunt for the best value to meet my own needs and wants. But then I’m highly focused on marketing and how it works. As I always remind clients “You are not the customer” - surviving brands have real loyalty (and real enemies).
Even the example HBOS is one that’s for the ‘experts’. As far as the typical consumer is concerned, the brand is likely to be Halifax and not HBOS. As I came out of the empty central Oxford library last week, I saw plenty of people busily transacting in the Halifax branch next door.
Personal relationships are great if the two people involved fit. Smart business will now put more energy into understanding how to please their customers. That goes for large as well as small.
Not all businesses are smart though!