Here is an interesting story from abcnews.com – What Do iPhones and Designer Jeans Have in Common? The answer is found in the subheading – They Keep Selling, Even in Recession.
Here is a list from the article in regards to hot-selling products during this recession:
Wal-Mart and Costco
High-definition TV sets
An odd list, wouldn’t you say? The low-price options are logical, the other ones not-so-much. The explanation from the article:
“Even in down times,” said Michael Gartenberg, vice president for strategy and analysis at Interpret LLC, “people still have some discretionary income. What happens is that they spend it more carefully.”
So they look for things that will last for them — which means, for instance, that a television set will look more appealing than, say, a vacation. “They’ll get several years of use from the TV,” said Gartenberg, “but when the vacation is over, well, you have your memories, and that’s it.”
Now that makes sense…though I have young kids so the memories of those vacations are worth quite a bit to me.
Recently I have found functional upgrades to be better sales approaches than outright new purchases. What I mean is that companies are still investing in their production capabilities if there is a defined return on that investment. This approach occurs in any economy, but it is the strongest play in this economy.
I have seen companies tighten spending in “new” areas, but continue to budget for enhancements in existing areas. One such company I encountered was in the midst of a slowdown like many other companies. The production team decided this was an opportune time for some needed upgrades to their capital equipment that normally would be in use for 3 shifts. The salesperson got the deal to upgrade it and the customer got a better price since it didn’t have to be completed over a weekend.
This approach is consistent with the article – companies still have some discretionary funds and they are looking for long-term improvements to their bottom line. As a salesperson, this is the first place to start your approach with a prospect.