I think the main difference that people forget: discretionary vs mandatory spending. People are currently being killed by mandatory spending (housing/rent, food, healthcare, gas/transportation) to the point that their discretionary spending is all credit or avoided entirely.
The price gouging since 2019 has been extreme. Companies have inflated prices to what the market can and will bear. Look at fast food; the value proposition has completely collapsed. Automobile prices are insane.
This is the find out phase of FAFO: when no one has any money to buy your shit. You either carve out a niche of consumers who spend more per transaction, or attempt to rebalance towards more consumers and less per transaction.
Unfortunately, consumers are hurt on both sides of our economy (rampant inflation/stagnation of wages, and recession). Those with assets will profit when we print more money, and by buying up the lost assets from the working class at discount prices.
Makes you wonder who the economy is meant to be working for.
Spending has kept up in the mandatory spending bucket. Consumers cannot cut spending from this category regardless.
I don't disagree there's a large divide between who is spending on surplus goods vs. basic life necessities currently. And there is a growing cc/consumer debt that should worry everyone.
I've already addressed your point in my previous response: I think what we're seeing is a division into niches - companies would rather target specific consumers at elevated prices than a lot of consumers at lower prices.
Yep - targeting specific markets is the ideal. You have an individual who is willing to spend the money and is a captive audience. Social media has made this even worse, and now you do customer profiles to the nth degree of granularity.
And it’s easier too. Would you like to spend $1K to blanket target 1MM people with a 1% likelihood or spend $100 on a target market ok 100K people with a 10% likelihood to spend. I’m simplifying but it is the move to purchase that is the hardest for consumer based businesses (movement through AIDA).
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u/TheLamey 8h ago
I think the main difference that people forget: discretionary vs mandatory spending. People are currently being killed by mandatory spending (housing/rent, food, healthcare, gas/transportation) to the point that their discretionary spending is all credit or avoided entirely.
The price gouging since 2019 has been extreme. Companies have inflated prices to what the market can and will bear. Look at fast food; the value proposition has completely collapsed. Automobile prices are insane.
This is the find out phase of FAFO: when no one has any money to buy your shit. You either carve out a niche of consumers who spend more per transaction, or attempt to rebalance towards more consumers and less per transaction.
Unfortunately, consumers are hurt on both sides of our economy (rampant inflation/stagnation of wages, and recession). Those with assets will profit when we print more money, and by buying up the lost assets from the working class at discount prices.
Makes you wonder who the economy is meant to be working for.