Time to Turn Wheels of Spending

Customers have lost both cash and confidence during COVID - 19 period. No one seems to be spending, no one is in any mood to spend. For days there is a tireless wait from the customer's end for the Government to wave a magic wand, and miraculously put the economy back on track. But all of us know, that's wishful thinking! In cases of other economies, it has been observed that there is a sharp spike after the announcement of a stimulus package, but thereafter there's also a sudden dip; which is to say that a stimulus package is a mere placebo and not the solution to boost the economy. In other words, the engine of economy cannot be kickstarted by the fuel of wishful thinking.

The first thing that we need to understand is that the economy needs both external and internal stimulus. It is in this backdrop that I am forcing myself to pen down the article, and mind you, this is merely a marketers interpretation of the economy. As a marketer, all that I understand is that in order to jump start the economy, consumption needs to go up. And that is obviously easier said than done. It is however the classic conundrum of consumerism in India is that 'How does a consumer who has no money step out and start buying what they want?, especially when the buyers are more worried about tomorrow's needs rather than their requirements of today! One can work out multiple approaches, but all it will lead to is transfer the money from one pocket to another.

How does this happen ?

Why, what and how consumers buy have changed after the COVID outbreak. Consumer priorities have become centered on the most basic needs, sending demand for hygiene, cleaning and staples products soaring, while non-essential categories are slipping in the preference ranks day by day. The factors that influence brand decisions are also changing as a "buy local" trend is picking up in India. Digital commerce has reinvented itself as consumers are migrating online for everything starting from grocery shopping.

In times like these, our need for the basic necessities of life takes precedence. It comes as no surprise that personal health is the top priority for the consumers, followed by the health of family. Food and medical security, financial security and personal safety are other leading priorities.

In fact it has been found that that 90 per cent of consumers are making lasting changes to how they live, work and shop, and there is no going back to the pre-pandemic world for consumer brands as per an article by Brand Equity.

When day in and day out the consumer or the spender comes across articles and news about job losses or businesses disappearing or old business models being replaced with bizarre ones, how does one spend? And when one cannot spend, how will the money change hands. Let's face it, all of us would rather save our money for a rainy day, rather than spend it with the expectation that our spending will ultimately circle back to us - which is again, wishful thinking. The path forward on this unknown journey has to be illuminated by someone who can lead us all. The present day Government, with its very firm grip on the psychic of the society and emotional connect with the masses not only holds political sway but also a big brotherly appeal. The government should help and drive a campaign to communicate by encouraging spending and not merely stopping businesses from evolving, and going about the way they earn.

"Spending is Earning",  the more money the people spend, the more the economy gets a boost. All that needs to be done is a quick change of hands and that too, several times through several people. A mega campaign if carried out by the Government, educating the virtues of spending, and also extolling the benefits of doing so. The way we have been noticing already, doles given to citizenry will only lead to hoarding of money, it will never lead to lucidity in circulation.

We need to inspire spending. Brands will need to explore ways to rebuild consumer confidence and at the same time also relook at ways to tap into the opportunities of our homes as the new hub.

Let us all spend, so that someone else spends on us.