If bad times equal good times, what happens when the good times return?

fastfoodsmilingWith the credit crisis having a “profound effect” on household spending in the U.K., according to the Telegraph, it seems fast food brands are having the time of their lives. There has been a veritable procession of good results from the likes of Domino’s, KFC, McDonald’s, Subway and Gregg’s. All plan to open many more stores while creating thousands of jobs.

Is it possible, however, that in their hurry to leverage their recent success, these brands are setting themselves up for a hard landing when recovery kicks in? The current economic crisis may change mind-sets for the long term—causing a deep re-evaluation of spending and lifestyle habits—thus fostering a permanent love for affordable brands among mainstream consumers. But it’s also possible that this shift is nothing more than a short-term coping strategy. Given that aspirations are more likely to be bottled temporarily than shelved permanently, it may be a good idea for brands to closely follow consumer psyche and behavior down and up the economy curve as they plan ahead—especially if “cheaper” is their only calling card.

3 Responses to “If bad times equal good times, what happens when the good times return?”


  • THis could be a good opportunity for Dominos and others to take a hard look at their offerings and make changes that are likely to work post crises and in the long run. They could really win over hearts and minds – if somebody took a long hard look at strategy. If their focus is single minded and on the NOW, they might have a hard landing as you say.
    The second issue is about price. We have always associated cheap with unhealth. A healthy lifestyle was always considered boring, tasteless and not sexy. Could we make healthy aisles cheaper?

  • THis could be a good opportunity for Dominos and others to take a hard look at their offerings and make changes that are likely to work post crises and in the long run. They could really win over hearts and minds – if somebody took a long hard look at strategy. If their focus is single minded and on the NOW, they might have a hard landing as you say.
    The second issue is about price. We have always associated cheap with unhealthy. A healthy lifestyle was always considered boring, tasteless and not sexy. Could we make healthy aisles cheaper?

  • I guess it all depends on how long the recession occurs. If it’s relatively short, than yes, consumer norms might bounce back to what they were just two years ago. But if it’s a long downturn, than it might radically change people’s assumptions on what’s normal purchasing behavior.

    I like what John Quelch wrote here http://tinyurl.com/c2t34w: “Don’t assume a return to normal. The longer and deeper the recession, the more likely consumers will adjust their attitudes and behaviors permanently. Their coping mechanisms may become ingrained and define a new normal. In addition, the competitive landscape will have changed. A competitive shakeout along with new product launches may mean consumers are looking at your products and services through new lenses. Listen closely to your customers and revise your market segmentation assumptions.”

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