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Bits ‘N Pieces


Small business CEOs losing confidence in economy

CEOs’ declining economic confidence is continuing to impact their decision-making, according to a joint Wall Street Journal/Vistage survey published in October. Throughout 2015, CEOs of small firms became increasingly less confident, with numbers falling to their lowest level in nearly two years. The WSJ/Vistage Small Business CEO Confidence Index was 101.9 in October, down from 103.7 in September and the peak of 115.5 at the start of 2015. As a result of continued economic weakness, these CEOs reported that they are increasingly unwilling to invest in building new plants, purchase new equipment and add to their workforces. The report cites uncertain prospects for the economy and uncertainty surrounding monetary policy as reasons for the decline.

Consumer trends for 2016 has identified five consumer trends for 2016.

  • Status tests. These force consumers to prove their worth to a brand. While this seems counterintuitive, the more difficult the test, the greater the status. For example, a Lee Jeans campaign in China to promote heat-retaining denim offered access to exclusive events to customers who went out in the cold and tracked their movements with an app.
  • New channels. Consider whether you can create new channels to be in the right place at the right time. For example, a European hotel, in partnership with a fashion brand, stocks hotel rooms with clothes and accessories, which guests can use during their stay and buy at checkout.
  • Ethical company culture. Create an ethical culture customers want to buy from. For example, an Asian taxi service uses 14 percent of its income to offer its drivers benefits such as life insurance, English lessons and scholarships.
  • Beneficial intelligence. Consumers want brands to create smart products and services that will save them time and improve their lives. One example is a Swedish train operator that uses big data to anticipate delays and then notifies passengers of changing departure times through an app.
  • Perspective shifts. Reposition your brand in a way that gives customers a new appreciation for what you do. For example, a French airline created branded chips, candy and cereal bars that double as tickets. Buy candy for 30 to 40 euros and use the product code to book a flight.

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Flat salary budgets spur promotions

Despite improvement in the economy and the job market, salary increase budgets for U.S. companies aren’t reflecting that, according to Mercer’s 2015/2016 U.S. Compensation Planning Survey of 1,504 mid-sized and large U.S. companies employing more than 17 million employees.

As a result, companies are tying base pay increases to stellar performance and using performance-related bonuses and career advancement programs that increase pay as employees are promoted.

According to the survey, the average salary increase budget is expected to be 2.9 percent in 2016, up from 2.8 percent in 2015.

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