Launching a Product During a Recession Can Pay Off, Researchers Say in MIT Sloan Management Review
CAMBRIDGE, Mass., April 29, 2025 /PRNewswire/ -- It seems counterintuitive to launch a new product when many consumers are likely watching their spending. But according to new research published in MIT Sloan Management Review, economic downturns could be a strategic time to bring new offerings to market.
According to the research shared in "When Launching a Product During a Recession Pays Off," "On average, new products launched during a recession have higher sales and market share and remain on the market longer than those launches during boom times (19% longer for automotive and 14% longer for fast-moving consumer goods)."
"There are underlying dynamics in recessions that companies can use to their advantage in product launches," states coauthor Steven H. Seggie, an associate professor of marketing at ESSEC Business School in Paris.
Because so many businesses are pulling back on spending, particularly advertising, the market is less cluttered and less noisy. That means companies that introduce new products benefit from reduced competition and greater visibility. These companies also have stronger bargaining power with both their upstream and downstream supply chain partners. Companies can secure better deals on materials, access more favorable advertising, and even obtain cheaper shelf space from retailers.
"Skillfully navigating these opportunities requires leaders to pay close attention to customers, competitors, and their own company," adds coauthor Koen Pauwels, associate dean and a distinguished professor of marketing at the D'Amore-McKim School of Business at Northeastern University.
"Of course, timing is important," adds coauthor Berk Talay, professor of marketing at the Manning School of Business at the University of Massachusetts Lowell. "Launching later in a recession is better than earlier. Use helpful economic indicators, track financial expert forecasts, and create KPIs to watch key variables to assist in timing."
Launching products during a recession can send a powerful signal to stakeholders that the company is resilient. That enhances a company's reputation, showcasing it as a strong, well-positioned player in the market, and further boosts confidence and trust in the business's long-term prospects.
Read the full article with data and statistics in the MIT Sloan Management Review article "When Launching a Product During a Recession Pays Off," which publishes at 1 p.m. ET on April 29, 2025.
About the Authors
Steven H. Seggie is an associate professor of marketing at ESSEC Business School in Paris and the academic director of its Weekend Executive MBA and Hybrid Executive MBA programs. Berk Talay is a professor of marketing at the Manning School of Business at the University of Massachusetts Lowell. Koen Pauwels is the associate dean of research and a distinguished professor of marketing at the D'Amore-McKim School of Business at Northeastern University.
About MIT Sloan Management Review
MIT Sloan Management Review is an independent, research-based magazine and digital platform for business leaders published at the MIT Sloan School of Management. MIT SMR explores how leadership and management are transforming in a disruptive world. We help thoughtful leaders capture the exciting opportunities — and face down the challenges — created as technological, societal, and environmental forces reshape how organizations operate, compete, and create value.
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SOURCE MIT Sloan Management Review
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