This scares the shit of me as a marketer

QUICK READ: Before you pop too many corks celebrating this supposedly fantastic economy, remember that someone is going to have to pick up the tab at the end of the night. A few days ago, the New York Fed released numbers showing that U.S. household debt just surpassed $14 trillion for the first time ever. The last time total household debt peaked at anywhere near this figure was in the third quarter of 2008, as the teeth of the Great Recession really sunk in. 

OK, people are feeling good about the economy and when they feel good they spend and go into debt but eventually, the bill is going to come due.

A near majority of Americans, 49%, are living paycheck to paycheck, according to a new survey by the First National Bank of Omaha. 

The survey also found that 53% of respondents do not have an emergency fund that covers at least three months of expenses. Further, 42% say their most relied-upon personal finance resource is a spouse or family member.

These findings come as median hourly wages in 2019 increased by just 1%, according to a report released Thursday by the Economic Policy Institute, a left-of-center think tank. The median wage last year was $19.33 per hour, which translates to about $40,000 per year for a full-time, full-year worker, according to the institute.

Income inequality in the United States worsened in 2019. Earners at the top of the income ladder received the largest increase in their paychecks, according to a report from the Economic Policy Institute. Wages at the 95th percentile grew by 4.5% last year, while the median increase was just 1%.

Oh-Oh

If you’re a marketer the above facts should be a warning. It’s like the great quake in California; we know it’s coming we just don’t when.

Right now brands are losing market share to private-label products and consumers don’t like wasting money on empty brand promises. Although it’s way too early to hit the panic button smart CEOs are developing contingent business plans to help their brands navigate the next recession which could be huge.

One of the first areas that are cut when the big R hits is marketing. This is a huge mistake. Keep marketing. Do not be tempted to cut or eliminate marketing activities. This is no time to cut back on marketing. If you can’t afford a full-blown marketing campaign, pursue low-cost options such as social media marketing, webinars, news releases, e-mail blasts, blogging, and online newsletters. Be sure to keep your marketing activities going at least six months so that you can track your rate of return and hold marketing accountable for every dollar spent.

The other area you need to protect is HR. Too many executives cut payroll in order to improve the balance sheet but laying off people can have a negative effect on your business. You also need to hold onto your best talent. If they leave you are losing a lot of knowledge and that loss can lead to faster revenue declines.

It’s time to admit that the news about the economy is not all rosy. Behind the headlines are some very scary statistics. The next recession is coming and your job is to ask “what if..?”.

This scares the shit of me as a marketer

About richmeyer

Rich is a passionate marketer who is able to quickly understand what turns a prospect into a customer. He challenges the status quo and always asks "what can we do better"? He knows how to take analytics and turn them into opportunities and he is a great communicator.

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