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I speak to an meet a lot of different business owners and every single one has a differing view on what life after this crisis will look like.

For many it will be a gradual return to business as usual and others it will be a slightly different version of the past.

I think they are wrong and I think businesses should be preparing for very different times ahead.

There is no doubt that the Government JobKeeper (& Seeker) programs have saved Australia from a great depression, but things will not be returning to normal any time soon and here is what I think people are missing.

Unemployment is going to be a thing – A big thing.

Hundreds of businesses have closed and many won’t return and come October when the Government funding runs out, people who have been saved the initial pain of this situation will suddenly be faced with the reality that they are actually unemployed and will join a long queue at Centerlink.

This will change the spending capability of consumers put simply discretionary spending is going to take a hit.

The Real Estate Market will stall.

The current situation of rent freezes and defaults may rectify to some degree, but unemployment is going to continue to put strain our real estate sector. People on Mortgage Freezes now will be faced with their mortgages restarting. But the real problem may lie in the ongoing restrictions of travel and MIGRATION.

With Australian property investors so heavily reliant on population growth to maintain and push demand our lack of immigration will quickly show, mortgage and rental defaults could make many properties worth considerably less or even unsellable. This will change our wealth structure and again spending will take a hit.

Our war of words with China will hurt.

The current war of words with China of the origins and handling of the situation will potentially alter our trade relationship with them for a long time. An our exports will also take a hit, and the cash cow of Chinese students will hit our education sector and tourism as if not already reeling from COVID-19 will also see a reduction in Chinese tourists. The impact will be felt throughout the economy but think of those businesses built around this market such as student accommodation will be severely impacted.

So the economy may well be hit HARD and I don’t think there has been any real discussion around what the government is going to do beyond October. And I don’t think many businesses are in the head space to either given the shell shock of this situation.

No one has a crystal ball so none of those may necessarily DIRECTLY impact your business, but at a macro level they may well alter the economic conditions we all trade within and it also means some new things to consider in terms of HOW your promote your business.

 

So what can you do.

  1. Build brand recognition – At this moment just being a survivor of the crisis will say something about your business – especially in sectors heavily impacted by the crisis.Post crisis however, people will potentially be left with an abundance of choice (in some sectors) and in some cases a level of scepticism as to what reflects a good deal. With less money to spend and offers likely to be coming from everywhere as people try and move stock, re-establish cashflow and just generally compete for sales – the power of your brand will be vital in providing trust and a point of differentiation beyond price.

 

  1. Reward your loyal customers – With stock potentially sitting around for extended periods many businesses will go into discount mode. This may be a short term strategy that dilutes the value of your brand and product/service – so consider offering heavy discounts to existing or loyal customers as a special offer first. This has a few positive outcomes strategically, 1) It rewards those customers who have been loyal to your business first 2) It tests the market and will provide market feedback as to the markets sentiment 3) It does it without public dilution of your prices to new customers.
  2. Sharpen the product offering – with less money circulating in the economy there may be less breadth in terms of the spectrum of (what was) your customer base. So look at your numbers and consider honing down to a smaller more focussed product suite that reflect your most VALUABLE product lines. Hone in on who your core customers are, who are the most valuable and focus your marketing budget on reaching them more effectively.

The market may very well be different than what it was prior to the COVID-19 crisis however, if we consider that the Australian economy may well have been on the way to a major recession any way – One massive positive may well be that whilst the economic situation, post COVID-19 may be soft – there will be a huge effort on behalf of the government (governments around the world) to accelerate the economy and people will generally be equally focused on recovery from the crisis rather then bogged down by the rhetoric of a recession.

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