Brexit – The Effect on Consumer Spending & What Brands Can Do

24 June 2016

UK public has decided to leave the EU.

This has already resulted in incredibly heightened anxiety and uncertainty amongst consumers. The consumer confidence is likely to fall significantly within the next few days and continue to stay low within the next few months. It is further enhanced by David Cameron’s decision to resign. UK public not only does not know what will be the repercussions of this important decision on the British economy but they also don’t have a calm and collected leader to take them through this difficult change.

It is however not the government and financial institutions that will have the biggest impact on balancing consumers’ sentiment. It is the brands, which people trust, like and identify with, that will have the profound influence on how people will feel within the next few months and how they will therefore choose to spend their money.

The rational reaction will be to hold your money but the subconscious human mind does not operate based on rational calculations. The fear has decided to the EU and the fear will rule people’s wallets. It is brands’ role to decrease that fear and affect consumer spending to manage the decline of British economy.

So rather than withholding the investments, brands should ask themselves how they can invest smartly to make a positive impact on consumers’ sentiment and therefore the British economy. You can use your money for greater good and help manage the level of fear British public experiences.

You are the voice they are subconsciously subjected to on a daily basis. Use that incredible power to boost the overall economy. Strategically, such brand behaviour will have a profound positive effect on your customers’ loyalty and will strengthen their relationship with your brand.

To do that well however, it needs to be extremely subtle. It needs to speak only to consumers’ emotions and subconsciousness. People will be now on high alert with regards to their financial decisions. Therefore, you can’t encourage them to spend by accentuating product features or good ROI. It doesn’t work well in normal circumstances and certainly won’t work when anxiety, fear and uncertainty rule all people’s decisions.

So take the power you have as a brand people trust and use it to stabilise the bigger picture of consumer spending rather than focusing on short-term crisis management.