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Just released Bulletin. On 14 February 2023 Westpac released a statement in the Bulletin that: ‘Westpac-Melbourne Institute Consumer Sentiment Index falls 6.9% in February. Sentiment back at historic lows – weaker reads only ever seen during recession’.  What does this mean to you?

Consumer confidence, it’s the economic indicator used to measure the degree of optimism consumers have regarding the overall state of a country’s economic and their personal financial situation. Ironically, remarkably it is consumer confidence, and sentiment, that drive consumerism, the habit of spending. How this sentiment plays out affects the health and wealth of a Business.

In todays current economic climate if you are a Business owner its vital you are doing all you can to build your customers confidence to boost business! Read on to find out more!

Individuals and households have differing viewpoints depending on their economic, and financial circumstances. Households on tight budgets struggling to make ends meet are most likely to have dampened confidence in the current economic environment. Those battling rising loan interest rates will be cost-conscious, crunching their discretionary spending, and buying only the essentials.

Others, less financially restricted, may curb some spending but are riding out the storm and likely feeling more optimistic with the view that things will get better soon.

Business owners, Industry leaders reporting on their operations activities express mixed opinions, depending on the service or product. For example, a recent announcement ‘no sign of slowing demand but expect an uptick of ‘conscious consumerism’, spending over the next six months. Some operators report reduced profits but are still optimistic and ready to meet the challenges.

One electrical retailer suggests, inflation has peaked and price deflation for some products in his electronics and appliances stores is already happening. Consumers are changing their habits, some trading down to cheaper products but there is still interest in premium products, particularly technology.

There are other examples of increased demands and boosted sales such as recently reported in the tourism industry. With International travel borders reopened, travel-related gear and outdoor adventure saw sales rise in the first half of the financial year ended January 31^st.

Others say they are cautiously optimistic about future spending habits.  

Despite this gloomy picture, West Business reported (15 Feb), ‘some economists expect WA’s steady housing market and low unemployment to buoy local sentiment, likely insulating the State from the worst of economic shocks’.

Where do you sit? What steps and strategies are you exploring and implementing to cushion your Business and most importantly to build consumer confidence? 

6 Tips to try:

1. keep doing what you do best  - promote your expertise
2. create a happy workplace - happy staff, happy customers
3. make the customer buying experience easy and friendly - reward loyalty
4. go back to basics without losing quality - focus on value for money
5. monitor changing spending habits and patterns - one door closes another door opens
6. look for new markets and opportunities - be one step ahead of your competition

Start your steps now!