Right now, forecasting and predicting anything further out than a few weeks is a fool’s errand for the most part. Here’s just a sample of what’s currently in play that could severely disrupt any marketing/business forecast:
- The pandemic, still in its early stages
- Those afflicted by long-term health consequences from the pandemic, about 20% of survivors
- A massive wave of evictions and rent collections which were suspended but not forgiven (USA specific)
- A massive wave of loans and other debts coming due in July/August (USA specific)
- Suspension or termination of economic hardship relief programs (mostly USA specific)
- Upcoming flu season concurrent with the pandemic
- Global GDP impact of -5.2% to as much as -8%
- A forecasted active hurricane season
- A US presidential election
- Massive unemployment around the world
That’s not a small list of very, very difficult things to forecast, and the complexities of their interactions make the future even murkier.
That said, our stakeholders will be asking us for plans, forecasts, budgets, etc. and likely won’t accept an answer of throwing our hands in the air and shouting “YOLO!” What are we to do?
The path forward for all of us is to start by looking at the data we do have, and then building forecasts based on scenarios. Instead of putting together a single plan, we assemble plans based on reasonable potential outcomes. Given the list above, what are some realistic scenarios you might plan for?
- A continued severe economic contraction with economic activities down by 50% or more, depending on the sector
- A shallow, prolonged economic downturn after a rebound once shutdowns mitigate, with economic activities down 20-40%
- A bounce-back to economic activities nearing 80-90% of pre-pandemic levels
Given the current situation and existing forecasts, it’s unlikely there would be complete recovery or growth of world or individual economies in 2020, so while you could adopt that as a best-case scenario, it’s looking increasingly unrealistic.
The antidote to panic is solid planning. Based on the scenarios above, what plans would you build for a 50% reduction or more in revenue? A 25-40% reduction? A 10-20% reduction? What budgets would you put together, what hiring plans, what marketing strategies? If you’re B2C, how will you plan for similar decreases in consumers’ wallets? If you’re B2B, how will you plan for decreases in what clients want to spend?
With plans for all the above, you’ll be well-equipped for the second half of 2020 to deal with whatever the world wants to throw your way.
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