Without a doubt, the current economic climate causing the consumer confidence falling and jobless rates have been rising and the GDP falling faster than it did during 1982 recession, the mood that many of us feel is that thing are not going to turn quickly, or anytime soon. However, there are some economists, market observers and historians that are busy pointing out that there are opportunities to be made in the fallow ground for that make for a fertile field for innovation and invention.
In the 80s and during the recessions in the past, even though we suffered from the effects of the period, we also saw pronounced periods where technology and innovation. In fact, inventors and innovative entrepreneurs should be smiling. That timeworn proverb about “an ill wind that blows no good” truly applies in an economic downturn. No doubt, in garages across the country, innovators are hard at work and electronics hobbyist and dabblers are busy over their soldering irons as opportunity bangs on the doors. But it is a very different call that they will be answering, and to take up the opportunity, we need to step back and take a hard look at the current environment.
The companies are all desperate for great ideas to boost their bottom lines, but they are most interested in products that can rapidly and inexpensively dovetail into their current manufacturing patterns and existing plant and equipment. This is not the time for major capital investment, retooling and expansion. They also seek products that will easily sell in cash poor (or at the very least lessened and conservative) developed markets. No, there is no surplus cash for huge promotions and ad campaigns. We will see a trend by these companies to use marketing techniques that only cost should leads and sales arise, and will try and spend less accordingly.
The buyers’ needs and priorities have changed in a very marked way, as well. Household budgets are tightening and people are looking for cost-cutting innovations and affordable escapes or distractions from their own private depression. Gone are the investments in large ticket items, the family car will have to last a few more years, the new house and associated mortgage put on hold. We will see a noted domestic trend toward Internet shopping. In times like this, the family is more likely to gather around clever board games and inexpensive video games, and the manufacturers will need to realise that these much cheaper alternatives will supplant high-cost entertainment systems. Companies such as Sony and Microsoft may see that the return on the lost cost of manufacture of the PlayStation and the Xbox may take a little while longer.
Let us hope that like the trends of the past, economy-altering and enduring innovations will emerged from the workbenches of small business entrepreneurs and independent inventors rather than from huge bloated R&D budgets which have been the trend for the past decade. In good times and bad, the independent innovator and small business entrepreneurs and I for one hope that they’ll do it again.
