It’s a great time to invest in growth.
That might be counterintuitive. I wouldn’t have to say it if it wasn’t.
But it’s true.
Yes, super smart companies are battening down the hatches, conserving cash, cutting ad spend, and slashing headcount, particularly the types of tech jobs that typically drive growth. Even consumers are curtailing spending.
But most of those things are corrections, rebounding from euphoric post-quarantine highs. Things are starting to look like 2020 would have naturally looked if 2020 (and 2021) never happened.
To be clear, you should be smart, too. Spend your money carefully. Debt sucks. Always.
It doesn’t mean you shouldn’t be chasing growth. On the contrary, it’s exactly the reason – when everyone is conserving, cutting, and slashing – you should.
There are two types of growth: the kind that happens to you and the kind you create. The insane growth most companies saw in ‘20 and ‘21 happened to them. It merely needed to be managed, not that it was easy.
Now’s the time to create growth.
It’s no coincidence successful businesses and groundbreaking innovation often spawn during recessions (not that I’m convinced we’re heading toward one). When capital is expensive, we spend it more wisely, quickly shit-canning bad ideas. When coffers are bursting, we plow money into bad ideas until their last dying breath. It takes humility to admit your ideas suck – and humility is in greater supply when money isn’t.
When economic conditions are tight, companies operate with urgency. They trim fat. And now there’s a ton of high-quality talent on the market, ready to displace the quiet-quitters for comparable pay. Meanwhile, get rid of the old, clunky, legacy tools and suppliers you use and move to newer, more innovative ones. They’re likely less expensive because they, too, operate with urgency and less fat.
And when the advertising market softens, the landscape gets less noisy. We live in an attention economy, first and foremost, and attention is zero-sum. Now’s the time to grab it, when there’s more attention to go around. Incidentally, rates are cheaper too.
Sure, consumers are buying less stuff. But the customers you win now, when times are tough, will be yours forever when things cycle back around. Focus on finding new customers. The budgets of your current ones are flat at best.
Commit to growth in 2023. Invest in your best ideas. Kill the bad ones. Gobble up talent where you can. Advertise judiciously. Replace all your old stodgy insights tools with CivicScience.
You know. All the smart stuff.
Here’s what we’re seeing:
Only 8% of Americans expect their holiday plans to be meaningfully impacted by COVID this year. Granted, 8% still stinks, but it’s way better than last year. In all, two-thirds of U.S. adults don’t expect the pandemic to impact their holidays at all (knock on wood), up from 48% in 2021. For most people, those plans include family – 60% of Americans ‘definitely’ plan to spend time with family for Christmas, an increase over 57% last year. Call me old-fashioned, but I wish it was way higher than 60%.
The majority of shoppers just kind of wing it. I was way more fascinated by this study than I would have expected. First, we found that over half of adults would rather wander around a store until they find the item they’re looking for than ask for help. What’s more interesting is how much it varies based on the job type of the person we polled. Service industry workers (because they know it sucks to be bothered) and professional managers (because they think they have all the answers) are the least likely to ask for help. Sales and operations people are the most likely (because they’re efficient). We also looked at what kind of research people do before shopping. But you can read that for yourself.
Gen Z is more brand-centric than their predecessors and the strongest brands are benefitting. When compared to 18 to 24-year-olds five years ago, today’s young adults are over 2X more likely to say they value brand over price when shopping. Don’t mistake it for loyalty – brand loyalty is an urban legend. It means they are more discriminating, that they view brands as badges of their identity, often eschewing prestige for an expression of individualism. They’re thoughtful about the message their purchases send. You can see it in the changes in brand favorability over the past five years. McDonald’s, for example, has seen big gains among this group – because they’re unpretentious.
AI is here to stay, whether people like it or not. If you’ve been living under a rock, you may not have followed the ChatGPT zeitgeist of the past few weeks. We’re already beginning to explore using the technology all over our business – from writing contextually-relevant poll questions on the fly to generating images to accompany our written analysis. It’s amazing. And game-changing. However, the AI has a long way to go in the public eye, where the vast majority of Americans are uneasy about it. A clear majority of respondents have an unfavorable view of AI platforms like ChatGPT and others. And, while there is a high correlation with age, even Gen Z is a net negative. This is only the beginning.
Holiday binge-watching is on the upswing this year. We’re in the majority here at the Dick household on this one – we binge-watch the Harry Potter and Fantastic Beasts movies as a matter of Christmas tradition. It seems more and more people are taking up this trend, with 48% of Americans saying they’re likely to binge content over the holidays, up from 45% last year. New TV shows are the top choice, by a lot. One-third of people, like us, will binge movies they’ve already seen. Hulu and Peacock users are the most likely to binge.
Citibank customers are remarkably optimistic financially and also health-conscious. We published another peek behind the curtain of our vaunted 360 product, this one looking at the current mindset and behaviors of Citibank and Chase credit card holders. Both groups are above the fold when it comes to financial health, but Citibank customers are the best off. Give me a shout if you’d like to see how your customers compare.
The raging flu season is coinciding with a medicine shortage, because of course it is. Thirty percent of U.S. adults have either run into a shortage of flu or cold medicine or know someone who has. Thirty-five percent of consumers shop for brand name drugs and an equal 35% prefer DayQuil/NyQuil over all others (Mucinex is 2nd). Beggars can’t be choosers when they’re sick.
A bunch more stuff from the CivicScientists:
- Robux is the holiday gifting trend you probably haven’t heard of;
- Despite the latest CPI numbers, inflationary concerns jumped over the past week;
- Costco has a strong enough brand to pull off a membership price increase during economic headwinds;
- Sixty-one percent of parents of toddlers are likely to buy (or have bought) gender neutral toys this holiday season;
- Ugly holiday sweater lovers also love beer and Walmart+ and crypto;
- North Face takes the top spot as the most popular brand among skiers and snowboarders this year;
- Concerns over hate speech are soaring among Twitter users.
The top questions this week:
- How much have your spiritual beliefs influenced your career path?
- How long do you think you could survive if you got hopelessly lost in the wilderness?
- How often do you feel pressure to say the right thing at the right time?
- At what point in your smartphone’s battery life do you feel the need to plug it into a charger?
- How necessary is it for managers to be able to do the same work as those they’re managing?
- Would you ever consider working on a political campaign?
Answer Key: A lot; A good while, actually; Constantly; <50%; Depends on the job; Never again.
Hoping you’re well,
PS- For the first time in 3 years, I’m making the pilgrimage to CES for a few days to speak to a roomful of CMOs and moderate a panel. If you’ll be in Vegas, let me know, especially if you like blackjack or vodka.
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