How to Navigate a New Economy and Devaluation With Tailored Marketing Strategies.

April 13, 2024, by Tom Jawado

How to Navigate a New Economy and Devaluation With Tailored Marketing Strategies. by Tom Jawado

Earlier this year Lebanon devalued its official exchange rate for the first time in 25 years, weakening it by 90 percent. The central bank of Lebanon announced the new official rate of 15,000 pounds per United States dollar.

Moreover, the same happened in Europe. While the British pound may not be one of the weakest currencies in the world, it has certainly experienced the most depreciation. In 2022, the pound hit a 37-year low against the U.S. dollar after weak retail sales figures signalled fears over the UK economy. The pound fell over 1 per cent against the dollar to $1.1351, its lowest since 1985.

This trend in the devaluation of currencies did not stop only in Europe and Asia; Malawi, a country in Southern Africa as well, has been affected by it. Malawi’s currency lost nearly half of its value against the US dollar. The dollar shortage spurred a 44% devaluation curbing imports of fuel and other commodities

Now, a new economy and devaluation of a currency come about because of the need for Countries to boost their exports etc. An undervalued currency leads to a trading surplus, while an overvalued currency leads to a trading deficit. The two countries most notorious for having undervalued currencies are China and Germany. Unsurprisingly, those countries have run the largest trading surpluses.

In addition, one might wonder how marketers in these two countries tailor their marketing strategies to flourish in their markets. Well, Marketers in these countries often adopt strategies based on several factors which including:

  • Studying consumer behaviour
  • Measuring the target audience/ customers
  • Effective advertisements

While it is not in the best interests of the country to boost their economies through devaluation, there is an opportunity that lies around for marketers at this time. The improved balance of payments as exports increase and imports decrease shrinks trade deficits creating a window for new markets to expand.
It is also in times of economic devaluation, where marketers can seize the opportunity by establishing a uniform pricing strategy for their commodities. This not only helps ward off foreign market competition but also allows for the removal of middlemen, contributing to market price stability and ensuring products reach consumers as needed.

The bottom line.
For marketers selling their merchandise domestically, a new economy possesses both laybacks and growth. What matters is how swiftly marketers use their strategies in favor of their businesses.

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