Get creative!

Retailers like to call it the cocooning effect – when shoppers retreat into their own homes and their own little worlds, keeping their wallets shuts and their eyes on their loan statements and bank accounts.

If there was any doubt it was happening, today’s economic data should put that to rest.

A 5.7% slide in consumer sentiment (following last month’s 7% drop) shows that higher interest rates are starting to really bite out there.

Yet another fall in housing finance data indicates that punters are thinking twice about big purchases such as buying a new home. The fall also suggests housing prices are going to continue to cool as the year goes on.

In other words, this year’s cautious consumer is a lot like last year’s, except for one thing – there isn’t a government handout around the corner to get cash registers ringing again.

Unfortunately, it’s not a different story for those selling B2B. Business investment intentions are still weak, which suggests getting these clients over the line isn’t going to be easy either.

The question is: What are you going to do about it? How are you going to inspire consumers to part with their cash?

You’ll need to get creative. Could you run a special offer to a certain section of your customer base, such as your followers on Twitter or Facebook?

Or how about adjusting your terms of trade for some particularly good customers (giving them access to stock on a priority basis, or even working with on payment terms if you feel comfortable to do so).

Can you bundle products together to make you offering more compelling? Could you form a strategic alliance with someone who sells a complementary product and leverage their marketing efforts?

Is it time to reintroduce yourself to former customers with a survey or a “reconnection” discount?

Can you test five different conversion-boosting strategies over the next month to boost web sales?

The nervousness of consumers is unlikely to end soon, so it’s time to get creative.