Navigating uncertainty together
Times are tough — but you don’t have to go through it alone. Check out our insights to help you move forward with clarity and confidence.
How do you remain confident in your decision making in moments of uncertainty?
In today’s economic landscape, uncertainty has become the only certainty. While market fluctuations are natural occurrences influenced by political dynamics, interest rates, and regulatory changes, the post-COVID era has introduced more dramatic periods of instability than we experienced previously. Despite occasional signs of economic stabilization, confidence metrics are showing concerning downward trends.
This shifting confidence isn’t happening in isolation. Inflation expectations remain volatile, and price sensitivity continues to be at the forefront of these concerns. According to SKIM’s Consumer Perception of Price & Promotion Survey, a substantial majority of purchasing consumers globally report that price has become more important in their purchasing decisions compared to previous years.
These patterns extend beyond any single market, with global confidence indices showing similar instability worldwide, indicating that markets across regions are experiencing comparable unpredictability.
Challenges facing businesses today: Can you relate?
In our conversations with clients across industries, we’re hearing consistent concerns about navigating this volatile landscape:
Price pressure: Many businesses are experiencing the impact of purchasers switching to lower-priced alternatives, whether to competitor brands or less profitable options within their own portfolios, while others are even changing where they shop to find better value. As noted in McKinsey’s recent analysis, “Trade-down behavior, as seen CPG, remained consistent and pervasive. Three-quarters of consumers said they traded down in the first quarter of the year (up one percentage point from the end of 2024).”
Balancing promotional strategy: While discounts offer a quick fix for price pressure concerns, they can threaten long-term business health. Companies struggle to use promotions effectively without creating discount dependency that erodes profit margins. Striking this balance between short-term sales and long-term sustainability remains a critical challenge.
Agility without reactivity: Organizations are seeking ways to respond quickly to market changes without creating daily “fire drill” moments that paralyze operations. Many companies are challenged with establishing the right feedback mechanisms, resulting in either delayed responses or knee-jerk reactions rather than measured, data-informed decisions.
Budget constraints: With increased pressure to protect bottom lines, many companies are putting spending on hold – including investments in research that would otherwise inform data-backed decisions. This creates a paradoxical situation where the tools needed to navigate uncertainty effectively are the very ones being scaled back.
How revenue management strengthens your position
Now is precisely the time to lean into robust Revenue Management (RM) strategies. In an era defined by economic uncertainty and heightened price sensitivity, RM offers a crucial framework for future-proofing your business. It moves beyond simple pricing tactics to holistically understand and influence revenue and profitability.
At its core, RM involves strategically optimizing commercial levers that influence purchasing behavior, including pricing, promotions, assortment, and intermediary investments, to maximize long-term, sustainable growth. A key benefit of a well-implemented RM approach is developing a unified truth within the organization, enabling data-informed decisions across departments.
Understanding evolving needs, price perceptions, and willingness to adjust your pricing strategies- is fundamental to crafting an effective RM strategy. By leveraging data-driven insights into decision behavior, businesses can develop targeted pricing, promotion, and assortment strategies that resonate with value-conscious customers while protecting margins and fostering brand loyalty.
Equally critical is a renewed focus on brand communication. Effectively communicating your brand’s differentiators and unique value proposition becomes paramount in justifying price and mitigating trade-down behavior. When a brand’s worth is clearly articulated and consistently reinforced, decision-makers are less likely to base purchasing choices solely on price.
5 tips to move forward with confidence
In periods of market volatility, the businesses that thrive are those that get back to basics and focus on fundamental principles. To navigate uncertainty with greater confidence, we recommend these essential steps:
- Know your target audience: Develop a deep understanding of how your audiences’ needs and priorities are shifting, continuously seeking to understand their evolving behaviors and decision factors
- Link objectives to execution: Align on what those objectives are across both internal and external stakeholders, ensuring price, promotion and assortment strategies connect directly to broader business goals and stakeholder needs
- Promote smarter, not harder: Move beyond simply “using data” to strategically deploying promotional investments based on buyer insights and response patterns, creating strategic plans that maximize impact while preserving value perception
- Foster a unified approach: Create a unified truth within your organization through shared data and insights, eliminating siloed thinking and enabling cross-functional alignment on revenue management strategies
- Identify, prioritize, and fill knowledge gaps: In budget-constrained environments, focus limited research investment on the most critical knowledge gaps that directly influence needs and perceptions – the insights that will have the greatest impact on your strategy
Ready to navigate these uncertain times with greater precision and certainty?
At SKIM, we partner with the world’s leading businesses to develop and implement resilient strategies around innovation, revenue management and brand communications that stand strong even during market uncertainty. Our data-driven approach provides clarity when it’s needed most, ensuring strategies are grounded in decision insights and marketing expertise rather than market speculation. By tailoring our expertise and analytical minds to your specific business challenges, we provide solutions that are reliable, relevant, and right for your business needs. Let’s collaborate to bring greater confidence to your decision-making process.
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This is the first in our series of content addressing economic uncertainty in 2025. As markets worldwide experience unprecedented volatility, we’re sharing practical insights to help business leaders make confident decisions in challenging times.
