By Tom Sullivan, CEO, Princeton Partners
Don’t get me wrong; the British vote to leave the EU is a very big development which I will follow with interest. I just don’t like the headlines and soundbites I hear from television commentators who hype up the impact and instill anxiety in a large proportion of their audience. Example Soundbite: Market reaction to Brexit caused the average U.S. retirement account to lose over $3,000 in one day.
My take:
To the half of American adults who have little or no retirement savings, the factoid is mostly irrelevant. To families who are investing in IRAs and 401Ks, this decline should enable them to attain higher long term returns as long as they continue to invest a portion of every paycheck and benefit from dollar cost averaging. Market disruptions and recessions and market corrections come and go. It is well documented that ignoring the short term noise and staying the course over time (decades) is the best strategy to building growth in retirement savings.
My Concern:
The focus on negative news weighs on consumer confidence which is a key driver of economic growth. An alternative is to focus on the positives. For instance, consumer credit, which is also a driver of economic growth, will be cheaper since interest rates will likely not rise in the next six months. Debt can be more easily refinanced by consumers and businesses can leverage lower cost debt to invest in their future growth.
My Advice for Marketers:
So how is a marketer to act in an economic environment where there is increased volatility, risk aversion and fear amplified by media? Here are four strategies marketers should be pursuing:
- Product – Find ways to increase the real value of your products and services. You want to increase the value in the benefits/costs equation by enhancing benefits. Think about how automobile companies and dealers are capitalizing on continuously improving features and performance while reducing the total cost of leasing or ownership over time.
- Messaging – Help people to see and understand your value. First, you need to understand where your value is important, relevant and competitive. Once identified, bring that to the forefront of the consumers’ understanding.
- Tools – Develop decision-making tools to help consumers actually make decisions when you have their attention and engagement. Create a digital experience that makes research and evaluation easy and the decision to buy rewarding.
- Hypertargeting – This is the biggest opportunity for marketers today. Data-driven marketing, powered by big data and analytics, enables marketers to precisely target the prospects most likely to buy your product or service based on their personas, behaviors and interests. Take advantage of the technologies that enable the personalization of messaging to individuals and the development of a dialogue with the brands you are responsible for.