The world came to a standstill. No one was prepared for what would unfold over the next few months. Services account for 70% of the Czech economy, and many had to transform their operations substantially or suspend them altogether. We are facing drastic restrictions; medium-sized companies have laid off employees, unemployment is rising and more and more businesses are closing for good. Yet economist Tomáš Sedláček argues that we can fall a long way and still keep functioning. What will that look like in practice?
Surrounded by media dominated by negative news, people are highly inclined to make decisions based on fear. That fear then drives the global rush to buy particular products from physical shops and online stores. People may be isolated, but that makes them congregate all the more in the online world. They then watch the online world anxiously, wondering whether they have failed to take sufficient crisis measures. This is known as FOMO*, which significantly influences consumer behaviour and has a strong effect on whether GDP rises or falls.
*FOMO, or Fear of Missing Out: the fear that you might miss something.
Panic buying may support the economy briefly, but it is not sustainable in the long term. With their income prospects uncertain, most people are trying to minimise spending and limit consumption to essentials. So what is the best approach in the current situation for anyone who wants to keep their operation running?
To retain a customer, it is essential to know them well. Who are they really? What do they need? What does your product give them? Why can they not do without it? What is its true value to them?
Answer these questions well and you are in a strong position. You will be able to make a convincing case for your product or service even when a customer’s decision is shaped by FOMO or the need to save money.
Identifying your customer and their needs can also make it easier to transform your business. More than ever, the situation demonstrates how important business flexibility is. The crisis therefore gives you an opportunity to uncover management shortcomings and implement new approaches that work.
Do not let global panic intimidate you. Keep customers regularly informed about how you are operating now, what you are planning in place of cancelled events, and what they can look forward to when the crisis ends. Focus on creating interactive content for social media; this will strengthen your relationship with customers. It is important to show them that you are still there for them in difficult times.
Kristýna Tabačíková