This document provides strategies for businesses to thrive before, during, and after an economic recession. It recommends focusing on customer experience by listening to customer feedback and aligning products and services to meet customer needs and wants. It also suggests acquiring other companies at the right time, and refining people, processes, and platforms. The document outlines specific strategies used by successful companies during past recessions, such as Starbucks focusing on customer experience initiatives. It emphasizes the importance of being prepared for change by getting organizational assessments and focusing on employee education.

1. Recession Business Strategy:
What to Do Before, During,
and After a Recession
Rocketsource.co/blog/recession-business-strategy

2. Ordinary leaders react to the current
economic backdrop. Extraordinary
leaders learn which leading indicators
and data points to watch, when to
pivot, and when to stay put.
Historically, the yield curve has been
one of the leading indicators used by
analysts when predicting what will
happen economically.
Macroeconomic Activity Can Signal When
It’s Time to Pivot.

3. This line represents the interest rate
environment based on bonds and
securities, and has predicted the last
nine U.S. recessions.
Although foreboding in nature, a
flattening yield curve doesn’t promise
that a recession is right around the
corner. You cannot rely on this data
point alone when deciding when to
pivot your business strategy.
The Yield Curve.
Source: @CharlieBitello

4. Price-to-Earnings ratios can signal future performance and
showcase whether the economy is strong or on the decline.
Consumer spending moves in tandem with business success
because people hold on tighter to their money as the economy starts
to become unstable.
Other Data Points to Watch.
Source: @CharlieBitello

5. A recession plan is not a basic checklist or
a simplified backup plan. Instead, it’s
grounded in a solid framework that’s
used regardless of the economic
backdrop. It includes proactive analysis
and strategic responses when the
economy starts to shift.
At RocketSource, our proprietary
StoryVesting framework enables
businesses to thrive in an economic boom
and economic catastrophe.
Use a Framework that Delivers Success.

6. Although recessions bring unique challenges, with the right combination
of people, processes, and the ability to make crucial changes at the right
moment, you’ll be able to grow—even during an economic downturn.
Adopt a Thrive Mentality.
“The key to a strong recession business strategy is
to monitor the economic climate and pivot at just
the right time without losing momentum.”
- Buckley Barlow, Founding Partner, RocketSource
“

7. Growing out of a strategic inflection
point starts with empathy. Digging
deep to uncover what modern
consumers want will enable you to
grow, even during an economic
downturn.
Applying data to your empathy maps
takes the guesswork out of creating a
recession business strategy.
Data-Driven Empathy.

8. Lego was able to assess
global consumer demands
for durable toys and use that
to grow during the 2008
recession.
While most toy companies
were struggling, Lego’s sales
continued upward.
Lego Pivoted and Profited
During the 2008 Recession.
Sources: FactSet, Lego annual reports

9. Another recession will come sometime, someday. But consumers don’t just
magically stop spending all of a sudden. If you align your brand with your
ideal customer’s wants and needs before, during, and after the recession,
you’ll have nothing to fear.
Be Confident in Your Strategy.
“I’ve heard there’s going to be a recession.
I’ve decided not to participate.”
- Walt Disney
“

10. Strategic inflection points are moments
when growth stagnates—they happen
in every company, but are more
common or pronounced during a
recession because all businesses are
sent into an inflection point
simultaneously.
The ones that align with consumer
demands survive while the rest struggle
to make sales.
Plan for Inflection Points.

11. GMC Struggled During the 1990 and 2008
Recessions While Japanese Automakers Grew.
Consumers demanded longevity from
their vehicles during economic hardship.
While American automakers were known
for their assembly line efficiency, their
Japanese counterparts were considered
more reliable. This sent the big three—
GM, Chrysler, and Ford – plummeting
downward during the 1990 and 2008
recession.

12. GMC Struggled During the 1990 and 2008
Recessions While Japanese Automakers Grew.
Japanese Vehicle Production in the U.S.
Sources: Automotive News, AutoData
By aligning with the consumer’s
preferences, Japanese automakers
enjoyed steady growth while the big
three—GM, Chrysler, and Ford—were
scrambling.

13. Learn From Strategies
Used in Past Recessions.
1. Focus on CX by reallocating funds from research and
development. Many companies think that a new or improved
product will win customers without considering the brand
experience.
2. Look for strategic acquisitions or acquihires. Be on the lookout for
ways to bring on additional talent or production capabilities at
the right time to foster success.
3. Refine the 3 Ps—People, Processes, and Platforms. Do everything
you can to avoid losing your top talent and invest in efficient
platforms and processes.

14. Spending more on R&D may seem
like the obvious move, but it’s just a
part of the larger picture—CX.
Focus on what the customers
actually want, not what you
assume they want.
Listen to and learn from your
customers and employees on how
to improve the brand experience.
Strategy #1: Focus on CX.

15. Acquisitions may seem risky during
a recession, but it’s a huge benefit
when executed properly.
In 2008, Verizon acquired Alltel for
$28.1 billion. The move led to
upward momentum during the
recession, and mostly steady
growth since.
Strategy #2: Acquire.
Verizon Wireless Profits

16. People, processes, and
platforms are the main
building blocks of every
company and are critical
to success.
Optimize each segment
for growth by removing
bottlenecks and investing
time and money wherever
it’s needed most.
Strategy #3: Refine the 3 Ps.
People
Attract prospects,
gain leads, and
ensure that
customers
become loyal
advocates for
your brand.
Processes
The strategies
and workflows
that actually run
the engine.
Platforms
Software systems,
social channels, and
other tools to create
efficiencies of scale.

17. Knowing when to pivot
your spending before,
during, and after a
recession requires you to
be forward thinking.
Using correlation analyses
can help you know when
to pull back on the
throttle and when to push
the accelerator.
Spending Strategically During a Recession.

18. Results of Taking a CX Focus During a Recession.
1. You could increase lifetime value (LTV) and reduce churn rates.
1. You will likely have more cash on hand.
1. You could see a bond yield rating lift.
1. You could experience a brand sentiment lift.
1. You could see an increase in your brand recall rate.

19. “My Starbucks Idea” was started in
March 2008 as a way to solicit user
ideas and give customers a voice.
This resonated with consumers
because the company listened and
made changes based on the ideas
and user voting. They innovated on
the customer experience in
meaningful, impactful ways.
The Results from Starbucks’ Pivot.
Starbucks Market Share
Sources: S&P Global Market Intelligence, Starbucks

20. In 2008, Howard Schultz returned as Starbucks’ CEO after an 8-year
absence. Company profits were falling, and competition was fierce.
He responded by launching bold, new experience initiatives.
Starbucks: A Case Study in CX.
“[Starbucks] must shift its focus away from
bureaucracy and back to customers.”
- Howard D. Schultz, CEO of Starbucks, 2008
“

21. The best way to prepare for a recession is to prepare your business
and employees for change. Consider the following:
1. Get a third-party assessment. Allow your company to be
critically analyzed to understand strengths and expose weak
points.
2. Ensure that you’re equipped to react empathetically based on
valuable feedback.
3. Focus on personal growth by providing opportunities for
employees to have ongoing education. An educated workforce
is a key driver of success, in or out of a recession.
Assess Your Organization.

22. Insulate your business
from disruption.
Learn more at
RocketSource.co