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The Market in Tough Times

The Virtual Mentor
Archie P. Inlong

Last Wednesday’s statement from the Inter-agency Task Force (IATF) for Managing Emerging Infectious Diseases was disappointing for some, a relief to others.

The IATF announcement reflected the national government’s attitude of extreme caution, dousing cold water on hopes that things “would get back to normal” by the end of this month. 

Based on the latest announcement, Metro Manila, Cebu City and Laguna province will remain under enhanced community quarantine (ECQ). The general community quarantine (GCQ) does not look much different from the ECQ. Restricted mobility and the ban on large gatherings will remain.

This is seriously disappointing to businessmen and entrepreneurs who continue to harbor the secret wish that commerce can be conducted the way it was done prior to the pandemic.

The IATF position, however, won plaudits and calmed the anxiety on the part of those who were worried that the lifting of community quarantine measures could spark a second wave of COVID 19 infection and deaths.

Given this, it looks like the proverbial Tough Times will linger. Tough for physical mobility; tough for business.

We are no stranger to Tough Times.

Baby Boomers would have gone through at least a minimum of four “Tough Times” in their lifetime.

Times were tough in the 1970s as we faced serious economic crisis triggered by hostilities in the Middle East. Petroleum prices spiraled upward. Then President Ferdinand Marcos told Filipinos to adopt an austere life style. “Austerity” became the buzzword. Big cars were ordered to get off the road. Life was hard, money was difficult to earn.

In the early 1980s, political turmoil rocked the country. The Central Bank was overprinting money. Investors were leaving the country in droves. 

In that same period, the Philippine banking system received a terrible blow. A well-known Filipino-Chinese businessman incurred huge debts from several of the country’s financial institutions and then vanished. Banks which could not take the blow folded up or sold out.

Some of those which folded up were clients of the public relations agency where I worked. 

Those were tough times. Our PR agency folded up, too. 

More recently, we were by the short-lived Asian Financial Crisis. In 1997, the currencies of several Asian and Southeast Asian countries – including the Philippines – slumped. Stock markets crashed. Some investors could not take the blow and decided to take their own lives.

The 1997 crisis caught many by surprise. We saw the value of our money and stocks nosedive. Those were tough times.

In tough times, the Filipino consumer behaves differently.

First, he reexamines his spending priorities.

Second, he buys only what are essential to survival.

Third, he holds on to his money as if “cash is king”, as the saying goes.

This shared attitude is bad news for enterprises of all sizes. In the tough times we went through, many businesses simply chose to surrender.

Some knew exactly what to do and chose to stick it out. Knowing what to do and staying in business amid tough times made them stand out. They were who the market remembered, preferred and referred.

In the banking industry crisis of the 1980s, I asked an executive why his bank was buying expensive print ad space and placing big corporate ads. I said, “why are you spending on ads when there are no customers?”

His answer was, “Don’t worry, they will be back”.

Yes, after a couple of years, the local banking industry had gotten back on its feet and became one of the fastest growing and most stable in this part of the world.

And, yes, the customers came back. When they did, they went to business organizations who maintained their presence, sustained their relationships with their markets, and continued to build their reputation.

They stood by one important principle which our business mentors taught us: “In tough times, your customer may stop buying … but he does not stop dreaming”.

Our products and services represent a bridge that connect customers to their “most powerful dreams”. They never let go of those dreams even when times are tough. They wait for the better times to be back and pursue those dreams using their financial resources.

That principle remains sound even during the current tough times we face.

Here’s proof.

A bold group composed of young entrepreneurs called “Experience Philippines” (www.experience.ph) recently did a well-planned online survey.

The group polled 1, 012 respondents during the last week of April, 2020 – 55 days into the lockdown period.

Experience Philippines wanted to find out what people plan to do by way of travel once the fear sparked by the COVID 19 virus is over.

Here are some of their most important findings.

  1. Once the COVID 19 curve flattens, 84 percent of their respondents look forward to travelling locally for leisure. Some 16 percent are eyeing international leisure trips.
  2. After the curve flattens, 43 percent look forward to travelling via an airplane within a year’s time. Twelve percent plan to take a trip via an airplane within the first month that the travel ban is lifted. Another 20 percent would want to do it within 2 to 3 months. The remaining 25 percent would want to fly within 4 to 6 months from the lifting of the ban.

Experience Philippines’ survey proved the point: Filipinos may not be moving around now and they are holding on to their cash.

And they are holding on to their dreams. No virus is powerful enough to crush dreams.

Business groups like Experience Philippines understand the market even as they validate that deep understanding using the modern tool of online surveys.

Enterprises like this who sustained their connection with a hibernating market will emerge winners when the it’s time for everyone to start spending again.

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