Insulation through Connection

As we head into a global recession, all the signs point to caution: inflation is up, the dollar value is dropping, interest rates are high and stock markets performance is lackluster. Additionally, China’s emergence from COVID-19 restrictions could place additional inflationary stress on gas and food prices as that country becomes more mobile.

Careful and cautionary strategies are needed to weather the recession, even by the most experienced business leaders. At this time, understanding your customers is vital to aid in the development of strategies to help you navigate the recession successfully.

On this early spring day, as I pick mandarin limes from our tree, I contemplate how easy it is to gather the fruit within easy reach. I can evaluate the size and potential juiciness for use because the fruit is lower on the tree and easy to access. Similarly, I ponder the low-hanging fruit that businesses can leverage to help insulate them from the impending recession. Which of your customers are signaling distress now and how can you pivot your business to retain them through the tough times?

As a market researcher who has guided businesses through a couple of recessions, I have been through some of the early signals. Cost-cutting measures are the first signs of distress and could impact your client base. But do you know which of your customers are exhibiting those signs of distress? Now is the time to assess your own customers’ risk factors and devise a strategy to partner through the recession and achieve mutual success.

Most At Risk

To begin you need to identify your clients who are most at risk of churn; then find ways to help them. Zoom in on industries, cultures or groups most affected by the recession and start now to design strategies to guide through the crisis.

In 2007 before an impending U.S. recession, a large retailer identified customers who were shifting their shopping patterns to reduce sizes and focus on discounted products. They went out and spoke to their customers, visited their homes and explored the shifting economic landscape that was impacting their lives.

This discovery enabled them to identify segments of their customers whose behaviors suggested they were at risk for affording food. One noticeable and growing trend was that these individuals were shifting their shopping routines from mainstream retail to dollar stores (think: Dollar General, Dollar Tree and Family Dollar).

The retailer developed personas for these customer segments of “Good but Tightening,” “Starting to Shift” and “Extreme Risk” to reflect their heightened price awareness. The company also adjusted its marketing strategy to include presenting itself as an economy-focused brand to help its customers most at risk of food insecurity survive the impending recession. They also worked with partner suppliers to institute a discount section in their stores that offered everyday essentials at reduced prices.

This retailer made it easy for their most distressed customers to continue shopping at that store and delivered their needs to make it through the recession. Not to mention the pivot in retailing strategy helped drive loyalty with their existing customers.

Connect with Stronger Customers

The strongest advice I can give a client as a consultant is to keep forming a connection with your customers. Even if your customers have a strong long-term relationship with you and seem at minimal risk of flight, it is still wise as we head into a downturn to touch base with these customers. There may be surprises of customers you didn’t expect to be suffering. Monitor your customer engagement/usage and look for customers who may be slipping. Maintain the relationship by reaching out through quick focus groups or one-on-one sessions to understand their needs and offer resources and strategies to help them progress through the downturn.

The rule of thumb is that it costs 5 times more to win a new customer than to keep a current one. A recession can exacerbate that rule. So, keep connecting with your current customers and be an indispensable partner through the journey and they will be your low-hanging fruit.

Color & Culture has a team devoted to customer understanding that can help you focus on customer success for 2023. We can work with you to identify your customer cohorts that are at risk and develop the personas to help you to build defensive strategies to retain and re-engage your current customers. Reach out anytime at info@colorandculture.co.


Cherisse Lezama-Wagner is a researcher who has over 22 years of experience understanding customer behavior. She explores her curiosity of understanding human behavior through techniques across design thinking, market research and behavioral science. She has experience with clients from many different industries such as CPG, retail, healthcare, building manufacturing and more. Cherisse is the Chief Behavioral Officer leading the customer behavior expertise at Color & Culture.

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