There’s no escaping the cost-of-living crisis at the moment. With energy bills soaring, fuel costs through the roof and the talk of a recession later in the year, life at the moment is worrying and challenging for the vast majority of us.
And, with the start of the Christmas shopping season just around the corner, many ecommerce brands are already anticipating a slump in sales and hard times ahead due to the predicted recession.
The good news is that there are a number of strategies that you can put in place to limit the impact of the recession – we’ve outlined some of them.
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Why is the recession happening?
Rising inflation and the challenges that came hand in hand with the pandemic and Brexit are the main reasons why we are hurtling towards a pandemic. As a result, British consumer confidence tis already said to be 40% lower than one year ago.
How is it impacting the world of ecommerce?
There has already been a significant amount of research that has indicated that a number of ecommerce brands have already declined by 13% in search demand, with home improvement experiencing the biggest hit with a 30% decline in demand year-on-year.
In addition to this, other sectors experiencing a demand include the beauty industry,
consumer electronics and sports.
What strategies should you put in place to manoeuvre the recession?
Keep your marketing. Trust us, it pays off
When times are tough and trading slows, marketing is often the first thing to go for many businesses. However, it’s important that businesses recognise that continuous marketing actually plays an integral role in their survival as without it, retaining existing customers and reaching out to new ones becomes increasingly difficult.
Improve efficiencies
During the recession, it’s highly likely that you will need to identify areas where you can cut costs without it impacting on the growth of your business. After all, it’s only natural that as profits decrease, you will need to be smart when it comes to managing your ingoings and outgoings.
Understand how consumers trends
Recessions are renowned for changing buying habits and consumer trends. And this doesn’t just mean people are buying less.
Just like businesses, customers also look at ways that they can cut costs too by being smarter, switching to cheaper brands, spending more time looking for a bargain and navigating their own personal finances in a way that allows them to maintain their lifestyle, without it costing the earth.
Ultimately, you should look at the recession as a way to connect and engage with new customers, reinvent yourself and find new and innovative ways to cut costs. It doesn’t need to be all doom and gloom.
Speak to an eCommerce accountant
For any eCommerce business, it’s important to stay on top of your accounting. The best way to do this is by seeking the advice of an experienced, specialist eCommerce accountant who will have the expertise to help.
Get in touch with Unicorn Accounting today!
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