The world has not had a great few years. First came Covid, with widespread disruption to trade – from lockdown, to a virtual cessation of international travel. Then came the war in Ukraine, together with a huge rise in oil prices that has sparked inflation. And then the Fed put up interest rates to try to stave off inflation.

Remember, we’ve had nearly 20 years of low interest rates and low inflation, so this is pretty disruptive.

The big problem is that the US was technically already in recession in the first six months of 2020. Normally, the Fed would reduce interest rates to kick-start the economy. But instead, it’s had to raise rates to get rid of inflation – despite the fact that this is likely to cause more economic pain.

The stock market is taking a gloomy view, with the S&P 500 index down from 4,796 at the start of the year to 3613 today.  That’s a fall of nearly 25 percent. Cryptocurrencies have nosedived, too – Bitcoin is down more than 60 percent.

However, the US currently has the lowest unemployment rate in five decades. So although everyone’s having to tighten their belts, right now we’re not in Great Depression territory; people have jobs.

Will they continue to spend? The jury’s out on that. A lot of people, though they’re working and not badly paid, are not feeling confident about their ability to get through a major downturn. They already have a lot of debt, with revolving credits like credit cards, home equity lines of credit, and personal loans growing fast. Right now, they’re not taking the scissors to their credit cards, but my guess is the less confident will probably aim to repay as much debt as they can.

Consumer behavior will change. Nielsen research shows the majority of consumers think recession is already here, and they’re shifting their purchases accordingly. They’re shifting their spend to value retailers and brands, and they’re looking for promotions and discounts. And the private label share of the market has increased very markedly in both the US and Canada as consumers buy cheaper, unbranded products.

But retailers are getting smart. They’re making a lot of promotions, but they’re not discounting very deeply. That means they can increase their sales without reducing their margin very much.

To make money out of the market right now, you’ll want to think about repositioning your products.

•            Can you market them as a way to economize, for instance selling products that can help reduce waste or save energy? Reusable and recyclable products can do really well. Or you could move your food containers’ main benefit from keeping the fridge tidy to storing food safely for longer.

•            Can you market your products as a substitute for more expensive brands or products? For instance, prosecco makers did really well in the credit crunch as they marketed their sparkling wine to customers who used to drink champagne!

•            Consumers have become risk-averse. How can you position your products as a ‘safe buy’? You might stress durability, your five-star reviews, your certifications, for instance.

Using promotions has become difficult, though, because of inflation. Consumers are looking for cheaper buys, but if you reduce your everyday price, you’re going to end up losing money.

That’s why you’ll want to be imaginative about your marketing. Hold multiple limited promotions such as coupons and competitions, weekend specials and lightning deals, maybe on Vipon, and you can grab the most price-conscious consumers. But don’t drop your regular price. Leave it to your competitors to do that, and hope it hurts them. In fact, you may end up seeing competitors leaving the market. There’ll be some disruption if they hold a fire sale, but you’ll inherit a bigger market share at your original price if you stick it out.