Last week, the Governor of the Bank of England announced a 1.75% rise in interest rates – the largest for 27 years – predicting that inflation would edge above 13% with a recession beginning later this year that could be the longest downturn since the financial crash of 2008.

Once the dust has settled on the announcement, suppliers and retailers need to process the implications for their customer bases and pivot their strategies accordingly. And, fast.

Whilst the aim is to encourage people to borrow and spend less to minimise the long-term impact of rising prices, experts clearly forecast that many households already under financial pressure will likely be further squeezed by the interest rate rise. The upshot, many believe, will be consumers cutting back as they feel the squeeze tightening, looking to reduce outgoings and spend less on items they once would have happily bought but, which in these new circumstances, they must regard as luxury purchases.

The challenge for suppliers and retailers is that there is likely to be a continuing shift away from proprietary brands towards own label and how to create better value for all customer groups. In short, what are their portfolio, category and shopper marketing solutions in light of these shifts in behaviour.

There is no question that we are approaching unchartered territory, but we may be well served by remembering the maxim: the more things change, the more they stay the same.

Although impending recession will inevitably have an impact on shopping behaviours, people will be endeavouring to continue to enjoy some of their pre-recession favourites, albeit less frequently. This makes the situation for manufacturers not just a financial challenge but also a marketing opportunity. So, in addition to the now very familiar cost management strategies to fend off cost inflation, the negative lens can be reversed by seeking more innovative ways to help shoppers maintain those habits without it breaking the bank and go some way to preserving category and brand value over the long-term.

As always, the start point is rooted in insight on how shoppers and consumers plan to change their behaviours as inflation spikes. This could mean recognising that shoppers may well make personal sacrifices to, for example, keep providing for their children or even their pets at the expense of their own preferences. Understanding this and adapting plans to meet customer needs will be important in encouraging shoppers to continue with some semblance of ‘normality.’

There are no easy solutions, but one thing is for sure, guessing isn’t an option. Now is the time to invest ahead of the ever-steepening spiral in pricing research like that conducted by Bridgethorne Research to understand how shoppers will respond to increases in retail prices as well as seeking insight as to the initiatives to which consumers and shoppers will be most responsive.