5 ways to recession-proof your business in 2023

Let’s be clear: we’re not predicting a recession—they’re so complex that even the US government defers to the National Bureau of Economic Research (NBER) for that. 

But it doesn’t hurt to prepare for one, just in case. 

This article gives you five strategies to help you recession-proof your online business. You’ll learn how to maintain an outstanding customer experience (CX) and improve conversions even in a downturn.

5 powerful tips to recession-proof your online business 

Talk of a recession has everyone buzzing—including the C-suite. A recent McKinsey survey found that 81% of CEOs believe a recession is looming. 

What does that mean exactly? 

A recession is a widespread, consequential economic downturn that persists for months or longer. 

Executives, business owners, and employees alike worry about recessions because they know they can result in less funding, plummeting sales, decreased profits, and significant layoffs.

But here’s the thing: a recession is much less scary if you’re prepared for it. While there’s no way to 100% recession-proof your business, there are ways to limit the impact a potential recession can have. 

Let’s take a look at five strategies to help you stay afloat—even in tough economic climates:

1. Re-examine customer needs

During a recession, it’s more important than ever to double down on improving CX. Everyone—especially shoppers on your site—needs less stress and more delight when times are tough.

Remember: customers' wants and needs change if the economy turns sour. They could show more interest in affordable product lines, which then ice out your high-end bestsellers. Or, customers could crave small wins, like a discount code, free shipping, or even a less-stress, simplified checkout process.

The best way to find out what customers need is to ask them. Hotjar’s Ask tools work wonders here. Put a Feedback widget on any website page to get insights about what your users are thinking. Or, for more detailed insights, launch Surveys to ask them questions like, “Is there anything preventing you from purchasing right now?”

Hussle, an online company that sells gym passes, surveyed over 1,000 customers who churned—immediately after they canceled their subscriptions. The results showed that some shoppers didn’t want a multi-gym pass, Hussle’s main offer, because of its price or because they decided to purchase a membership directly from a gym. Based on this feedback, the company created a less expensive, single-gym offer to serve customers (and retain them). 

By discovering customers’ pain points and better accommodating their needs, you’ll see more sales and increase loyalty. Plus, your cash flow will thank you if a recession rolls around, which brings us to our next point.

2. Keep a close eye on cash flow

Consumers save more and spend less in a recession, meaning businesses might see less revenue on products or services. At the same time, banks and other lenders typically tighten their belts, too, making it harder to get a loan to cover operating expenses in a crunch. 

So, how can an online business recession-proof its funding and spending? The key is monitoring cash flow—the timing of when money comes in and out of your business. Analyze cash inflow and outflow now—and make adjustments as necessary—so that you’re in good shape in a potential economic crisis. 

Andy Strote, agency founder and author of the book, How to Start a Successful Creative Agency, asks, “Does your cash flow vary by season? Do an analysis of previous years to detect money patterns, so you're not surprised when it happens again. If you know you need a reserve for slow summers, start building it now.”

3. Use data to optimize conversions

In a recession, your company may not want to spend on paid ads to drive more traffic to your site. Instead, focus on what you can do to improve your current website experience for users and customers. 

“Dig into your website analytics,” Andy suggests. “Which pages are the most popular and what keywords lead visitors to those pages? Two possible actions: create similar pages to draw even more traffic or re-work pages that aren't getting the traffic you expected.”

Put data collection and analysis processes in place to optimize your website’s conversion rate before a recession kicks into gear. This means looking closely at quantitative data, the numbers that tell you what’s happening, and the qualitative data, the words and descriptions that tell you why.

4. Do more with less

As a CEO, business owner, or marketer, it’s easy to get caught up in ‘shiny object syndrome’—adding new initiatives and features, and buying new equipment. 

A recession lets companies reevaluate, cutting out ineffective purchases and processes and creating innovative and cost-effective solutions for existing problems. 

Your company might not have the funds for a pricey marketing campaign—but you could engage more on social media to drive word of mouth. (Bonus: these positive interactions spark customer delight and boost customer loyalty.) 

Likewise, your company might not have the cash for a new website during an economic downturn, but you can make small changes to your existing site to improve PX and CX. For example, Wyldsson, a plant-based ecommerce site, used Hotjar Heatmaps and Recordings to locate issues with their customer login and checkout experiences. Once they made the necessary tweaks, they saw a 30% increase in sales.

Here’s the bottom line: keeping a customer-centric mentality is the best way to guide your decisions about what’s necessary in tough economic times. Will a new purchase or ad campaign ultimately ease the customer journey and lead to customer delight? If not, get the most out of the resources you already have.

5. Select time-saving tools and automation

You might need to hold off on hiring during a recession, but there’s still just as much work to be done. You don’t want to add strain and stress by upping the workload of your existing employees, so it’s time to get creative. 

Even in a hiring freeze, you can boost productivity and efficiency across the board—from data analysis to marketing—with the right tools.

You can find tools to help automate or simplify nearly anything: from website engagement to marketing funnels. Finding software that offers the exact features to meet your needs can be game-changing, saving you valuable time and resources. When preparing for a recession, choose tools that work well for multiple teams in your company—and help you create added value and delight for your customers.

Marlin, a digital signage company, turned to Hotjar Recordings to save time and improve the user experience (UX)—and quickly found that Hotjar was a multi-purpose platform that had cross-functional benefits in their organization and helped them make impactful changes for their customers and business alike.

Bring value to your customers in any economic climate 

No one wants a recession. But even if one comes along, the news is not all bad: even a recession can have a few silver linings. Recessions force us to analyze our cash flow and financial situation, leading to smarter spending moving forward—and they make us think about what’s truly essential for both business and customers, helping maximize efficiency. 

By applying our strategies to recession-proof your online business, you’ll weather any economic conditions and still deliver a delightful customer experience.