Prioritizing Purpose Over Profit: What We Learned From The 2008 Crisis Through uncertainty, comes opportunity- look to history for hope to navigate times of crisis
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The world is changing again. Only this time it isn't the real estate market that has started the domino effect. It's a virus. One that can only be overcome by placing severe limitations on our everyday lives. Every country in the world is feeling the devastating effects of the COVID-19 pandemic- and we are all in this together.
With unemployment skyrocketing, businesses closing, and big money brands slashing budgets, to say we are living in challenging times is an understatement. But there are ways to not only survive this crisis, but thrive beyond it.
In 2008, a handful of engineers and I were working on a platform to empower collective action, most famously discussed in Malcolm Gladwell's book The Tipping Point. With the sharp economic downturn, we pivoted the business, and launched Groupon in November 2008. It was an incredible journey, and what we learned during the first three years prior to our IPO in November 2011 showed me how a business can not only survive, but thrive, while the rest of the US economy entered one of the toughest times in recent memory. This is the challenge that many brands and businesses face today.
At my company, Surkus, we strive to build practices and processes that are recession resistant. If we can't weather this storm, then we can't be here to help our clients and members get through it. That means running an agile operation that can adapt and respond to any crisis, large or small. The business continuity of organizations around the world has been tested, and those who had a clear crisis management plan are managing to cope with the situation best.
Here are five key considerations for all businesses trying to navigate the very choppy waters of the COVID-19 pandemic and the growing economic crisis.
1. Cost, convenience, and quality will drive long-term consumer loyalty
In uncertain times, consumers place more of their focus on basic necessities, over luxuries. While individuals will always have the desire to try new things, consumers focus attention on a combination of:
- Low cost items that hold high value to the individual
- Products or services that are convenient to mitigate further stress
- High quality experiences with personal connection and messaging that speaks to them
Consumers need low prices in the short term but in order to successfully create a meaningful relationship, brands must not lose sight of the importance of maintaining a high-quality and convenient experience.
2. Pick the right team
The team you choose to have around you is everything in times like this. There will be plenty of challenges to navigate, and you must trust your team to help find solutions.
Brands and businesses need to be able to build, test, adjust, execute, adjust again, then execute again. Not everyone can handle that type of rapid iteration inside a condensed and stressful timeline. It's important to showcase strong leadership with clear and honest communication. You need to show the team that there is a path to success and better days ahead. These are a few things that go through my mind every day as a CEO.
Find the right team that understands and jumps at timing and opportunity of the business. If the potential upside is there, and everyone on the team is bought in, then you will always overcome the inevitable mistakes made along the way.
3. Lead with purpose, not profit
Consumers have and will always look for new brands and businesses to connect with. The desire to discover will not fade. The big change lies in what consumers look for in a brand. Beyond a solid product and seamless experience, consumers now demand a deeper understanding of what the company's values are. Do they have a philanthropic angle to their business? How do they treat their employees? Are they ethically friendly to the environment? Now more than ever, people are hesitant to connect with a brand that may not share their same values.
Consumers who connect with a brand, whether that's a local or international brand, aren't turning their backs on them now. Instead, they're actively seeking out ways to support them, treating them like a distant but loved family member. Investing in high-quality marketing that results in true loyalty will help brands survive well-beyond this current crisis.
4. Maintain an innovative mindset
Through uncertainty, comes opportunity. Think about what is essential for daily life. That doesn't just mean food and water. That also means health, happiness, and financial security. The businesses that provide those types of services are growing now, and they will maintain that growth as we come out of the crisis, whether it's six months or six years from now.
Survival isn't solely reserved for those with the deepest pockets or the ones that can offer the biggest discount. Being able to adapt is crucial. Smaller brands are leveraging platforms such as Talabat and Deliveroo after they adapted to offer daily grocery services after identifying a clear need from consumers. Agility and adaptability gives small businesses an edge in times of crisis, and I predict that we'll see some great brands survive and thrive during this time.
5. Build a community
People are reaching out to support small businesses like never before. Consumers are buying gift cards for venues that are currently closed, so they survive and open again in the future. Restaurants and retailers quickly adapted to launch online/ delivery offerings in an effort to stay open while these shutdowns are in effect. Tech companies are helping to create communities around small businesses. These are all great examples of the power of people to drive positive change during times of uncertainty. The connections that are made between businesses and communities now can last lifetimes.
I'm proud that Surkus is actively helping brands connect with customers through virtual experiences. Our team has pulled together to accelerate the launch of a new product that will help small businesses drive in-store foot traffic, as the restrictions from the health crisis loosens, because that is when we will see the larger impact to the local economies around the globe. My hope is that, as a result of these challenging times, a stronger, more connected global business community emerges. One in which we see businesses prioritizing purpose over profit and focusing on creating long-term loyalty through meaningful connections.
While these are undoubtedly challenging and stressful times, there is a light at the end of the tunnel. Because this too shall pass. But until then, people will continue to consume from the safety and comfort of their homes. And when they can safely venture out, your brand will remain in their hearts, thanks to the way you connected with them now.