The Psychology of Dealing with Recession Jitters

Two storm clouds hang over the economic sky. One has been chilled by the Persian Gulf, the other seeded by the recession. Both have sent showers and shivers through all sectors of the economy.

Salespeople find it increasingly difficult to deal with worried buyers. Sales managers suddenly face the challenge of calming anxious salespeople while working hard to keep their own worries under control. Even top managers and business owners agree that selling has become emotionally more stressful than ever before.

In the following interview, Dr. Dominic DiMattia, a noted psychotherapist and business consultant, explains the potentially harmful consequences of exaggerating or ignoring the new realities of business and shows specific steps you can take to help your customers, your salespeople and yourself calm recession fears. Sales executives who follow Dr. DiMattia’s advice can lower their stress, increase their ability to adapt successfully and even learn how to turn a seemingly impossible situation into a new opportunity for further growth.

PSP: How should salespeople deal with fear of the recession?

DiMattia: We have to distinguish between legitimate concerns and exaggerated fears. I think it would be immature for anyone to ignore the warning signs of a shrinking economy. Salespeople have bills to pay and they have valid concerns about their jobs. When they see people get laid off, they may ask themselves, “When is it going to be me?” The real danger is to exaggerate the situation with thoughts like, “If I get fired, I won’t be able to support my family!” or, “If I get fired, I won’t be able to get a new job!” As a result of this kind of thinking, people whip themselves into a state of undue emotional stress that keeps them from functioning productively.

PSP: Are you saying that it is OK to question the state of the economy, and it is OK to ask tough questions about the future, but it would be foolish to predict that the worst is going to happen?

DiMattia: Exactly. The non-adaptive response would be, “It is hopeless. There is no way I can beat this. I can’t stand another rejection. There is just no business out there. My customers are just too scared to spend money and they are not going to buy anything at this time.” If salespeople produce these kinds of predictions, then their anxiety level is going to increase dramatically. As a result, they move into self-sabotaging avoidance patterns like drinking, drugs, gambling, driving aimlessly through the streets or engaging in promiscuous sex just to avoid dealing with the discomforting realities of business. The non-adaptive response is like a runaway train. Once it gains momentum, it is very hard to get off. Anxiety often creates a lot of unproductive work which leads to new evidence that success is impossible.

PSP: What would be a more productive response?

DiMattia: In a recession, survivors take positive action. They work hard at their jobs. They cut back on their spending, trim their budgets, explore alternative sources of income, forge back-up plans and consider new possibilities.

PSP: What can we do to reduce the emotional stress triggered by recession?

DiMattia: It is important to separate our thoughts about the recession from our feelings of anxiety. Recessions don’t cause anxiety. What triggers our emotions is our interpretation and evaluation of ourselves. Our feelings are a result of our own thinking and not a result of external events. All our emotions are a function of our thinking. I know many people who see recessions as opportunities to invest in basically temporary cash flow problems. These people believe that they will benefit from riding out the storm. The longer we’re in a recession the greater the probability we’ll come out of it.

PSP: Some people may even confuse this temporary recession with a depression.

DiMattia: That’s right. Just the word depression can trigger images of hopelessness and desperation like soup kitchens, milk lines and people jumping out of windows.

PSP: But there are some people who think that they are untouchable. They pretend that they are above it all and tell you that they’re recession proof, yet at the same time their sales are down.

DiMattia: These people are probably more frightened by the possibility of having to make major changes or losing their jobs so they decide to exaggerate in the opposite direction. They tell you that everything is wonderful and terrific. At the same time they can’t pay their rent. These people have attached their sense of self-worth to being very successful. The thought of being unsuccessful tends to create tremendous fear and discomfort for them. To avoid these unpleasant feelings, they deny that a recession could possibly affect them. Telling everyone that everything is terrific creates short-term relief, but leads to a long-term crisis. Those were the people who jumped out the window first during the great depression.

PSP: What can salespeople do when their customers become overly pessimistic about the economy? How do you deal with a customer who suffers from recession anxieties?

DiMattia: Remind yourself that things are not as bad as they may appear. We can help our customers best if we take good care of our own emotional life.

PSP: How can we do that?

DiMattia: We have to be realistic about our possibilities.

We have to accept the fact that our market has decreased by a certain percentage; work a little harder at prospecting; sharpen our skills and make more calls every single day. Also we have to be more creative in selling, become more patient with our customers and accept the possibility of not selling as much as last year, but this does not mean that we are failing.

PSP: In other words, our goal is to start our sales calls with an attitude that is not contaminated by fear, worry, anxiety or frustration.

DiMattia: Right. Remind ourselves that life brings ups and downs. Nothing goes in a straight line. When you go in and meet your client, tell yourself that this is just a normal, challenging situation. It is not going to be easy, but you will try to do your best to come up with a creative solution and resolve not to give in to your prospect’s fears and anxieties. If you notice typical anxiety signals, be prepared to shift gears quickly. Stop selling and start helping your customer. Ask questions. Find out what’s going on in the customer’s business. Find out what he or she is thinking and feeling. After you’ve listened for a while, probe into the exaggerated fears.

PSP: In other words, deal with the emotional agenda before dealing with the business agenda.

DiMattia: Exactly. Agree that, “Yes, these are tougher times,” and create a partnership by saying, “We both have handled tough times before and we want to work with you and come up with new ideas that will help us both succeed.” It would not be a good idea to tell your customers that everything is going to be great, because they may get quickly annoyed with you — especially when they look at their balance sheets. It is much better to join the resistance instead of ignoring or confronting it.

PSP: Also, you don’t want to reinforce your customer’s concerns.

DiMattia: Right. Many times the customer triggers the salesperson’s fears and they end up commiserating together.

PSP: How can you prevent that from happening?

DiMattia: Remind yourself every day that there is a high probability that you will talk to one of your customers who will complain to you about the terrible economy. Remind yourself in the morning before you get up that you will not give up that easily because you are following specific strategies that keep you from getting depressed or anxious about business. Before meeting with your customer face to face, relax and tell yourself that you will go in there and listen, acknowledge the customer’s fears and use problem solving techniques and strategies to help that customer with creative ideas. Sometimes the customer needs help with the payment plan, or he needs a better idea for promoting his business. During a recession customers will always listen to ideas that can help make their business more productive.

PSP: Often salespeople find customers in a negative mood and unwilling to listen. What would be a good way to get their attention? How do you join the resistance with a reluctant prospect?

DiMattia: First, I would arm myself with some important facts and figures about the business. Facts are often therapeutic in a doubtful economic climate.

The customer’s sales may be off by 12 percent, but 88 percent of his business is still going strong. A recession doesn’t mean that the economy comes to a complete stop. A 12 percent decline does not mean that you have to cut 100 percent of your purchases. I would help my customers to achieve some control over their thinking because the way we think always causes us to feel a certain way. Clients usually blow their problems out of proportion because of their thinking. Good salespeople understand that we can change the way we think and as a result, change the way we feel. With a little effort we can help our customers to think and feel differently.

PSP: What techniques can we use to change the way our customers think?

DiMattia: You can ask your customers, “How does being upset about the economy help you achieve your goals?” or, “What are the advantages and disadvantages of thinking that you are a failure?”

You can acknowledge the current situation by saying, “So, okay, we have hit a bump in the road. It’s rough. But does it get better by sitting around and sticking our heads in the sand?”

Most people realize that if they think clearly, they will begin to act more constructively and as a result they begin to feel better. Did you ever go to work and feel overwhelmed? Did you ever sit down at your job and feel you could not handle it? But once you started chipping away at all the tasks you needed to get done, you began to feel much better about your job. It is the same with handling a customer’s emotions. When you patiently start chipping away at these exaggerated ideas and overblown emotions, you help your customer to see things more objectively.

PSP: How about reminding the customers of how they have handled tough times before?

DiMattia: That’s a very good idea. I remember when the electronics business in Boston fell on hard times. There were articles about M.I.T. graduates painting houses and doing odd jobs. Many journalists painted a picture of doom and gloom, yet amazingly the majority of these people used this time to restructure their lives and became very successful in other fields. A very small percentage of these people actually crumbled. If you are rigid and unbending about making changes, you’ll have a hard time in a recession; if you are flexible and adaptable, you’ll have very few problems.

PSP: The winners in a recession are those who allow themselves to change and transform.

DiMattia: Exactly. Salespeople need to be reminded of what will happen if they keep working and struggling. The history of mankind is a history of struggles. There have been recessions, droughts, depressions and devastating economic times from the beginning of time. The people who adapt are the ones who persist.

PSP: Let’s say you are a sales manager and you find your salespeople worrying about their jobs. How would you help them?

DiMattia: I would teach my salespeople some very basic facts about this recession. First, I would remind them that recessions don’t last forever. Second, share with them what they can do to adjust their work habits to meet the new challenges. Third, offer an honest portrayal of their business opportunities, the company’s financial situation and the prospects for future growth. The facts are that people go on living during a recession and they’ll keep buying during a recession. Finally, help people understand that a temporary belt tightening does not mean being destitute, bankrupt or out on the streets.

PSP: What are some inappropriate ways sales managers deal with this problem?

DiMattia: One of the most ineffective ways is to tell salespeople, “Things are tough. We have to sell more. Management is on my back and if things don’t improve fast, some of you may be losing your jobs.” These kinds of threats always backfire because salespeople’s anxiety levels automatically go through the roof and as a result their performance decreases.

PSP: Also, some of them may become tempted to compromise their ethical standards.

DiMattia: Yes. If the manager says, “Sell at any cost,” then the company could be losing more during the next few months than it has gained during the past decade.

PSP: OK, threats and lowering of ethical standards are out. What do you do if the company’s survival is threatened?

Bring in the sales staff and tell them honestly, “Look, it is obvious that we have a serious problem.” Don’t hide the facts. Acknowledge that these are tough times. Tell them, “We can survive this only if we do things differently from now on. Let’s see how we can get the greatest possible share of sales in this industry.” Ask them to brainstorm ideas. Jointly develop alternatives. Discuss problems and opportunities with key accounts. Also, help your salespeople understand that the new adjustments will mean reduced earnings to some — but that’s not terrible or awful. The important thing is to be flexible and adapt. If they have grown dependent on large earnings, they’d better begin to make some adjustments in their personal lives as well. Help them accept reality. Tell them that for a certain period of time they may all earn less. However, they’ve had ups and downs in this business before and done well over time. The only thing you’re asking them to do is to work harder, work smarter and be patient, persistent and resourceful with their customers. Good quality and good ideas are always in short supply, no matter what the economy. Try to cultivate both.

PSP: So the sales manager should create ideas, not spread fears.

DiMattia: Right.

PSP: Everyone talks about working harder. What exactly do you mean by that?

DiMattia: It means keeping at the job even though you get no rewards. It means making a few extra calls every day without the certainty that you will be making more sales.

PSP: As a therapist, have you ever worked with people who have shown no signs of improvement over a long period of time?

DiMattia: Oh, sure. I run into very resistant people who are rigid and expect things to be the same all the time. They suffer from tunnel vision. They have their own set ways of doing things. They can’t adapt. That behavior should not lead the therapist to give up on the patient or the job.

PSP: How can a sales manager avoid getting contaminated by the staff’s anxieties?

DiMattia: It helps to realize that the job of dealing with salespeople is similar to the job of parenting. Children tend to exaggerate and overreact to certain situations. As a sales manager, I need to reassure my staff, to become acceptant of their feelings. I need to help them through conflicts and times of crisis.

PSP: Who motivates the motivator?

DiMattia: Ideally, we become our own parents. We’ve developed a quick method to deal with the emotional stress associated with the problems we’ve discussed. We call it the “ABC-method.”

When you feel anxious or worried, take out a piece of paper and write down how you feel. For example, you may write “I feel worried about sales.” Then write what you think is causing your fear. For example, you may write, “Today is the 20th of the month and I have reached only 50 percent of my monthly quota. This means I am a total failure and I may lose my job.” What is causing your fear is the activating event. Next, look for the exaggeration. The rigid kinds of thoughts and ideas. Like the idea that you are a total failure. The third step is to find arguments against the exaggerated idea like, “I have already reached 50 percent of my sales. I am not a failure. What can I tell myself to get back on track? This has been a tough month, but it hasn’t been that tough. What can I do to sell more during the last ten days of the month? What ideas can I generate to write more business?”

In essence, we are teaching people to dispute their unrealistic thoughts and to transform their feelings from worthlessness to productive confidence.

PSP: Does positive imagery help?

DiMattia: Yes, salespeople can close their eyes and imagine the worst scenario and then dispute it piece by piece. This way they can downgrade their responses from horrible to very difficult, to merely inconvenient. We all need to learn to increase our tolerance for frustration. Recessions are frustrating, but they are not so frustrating that they are unmanageable.

PSP: What about the company’s goals? How should they change in a recession economy?

DiMattia: I think it would be healthy to change from the philosophy of bigger and better to the philosophy of sufficient and enough. The obsession that the next quarter has to be greater than this quarter often leads to greater losses than necessary. The American culture has been governed for many years by the frontier philosophy. When things were tough in Boston, they moved to New York, when things were tough in New York, they moved to Ohio, then to Mississippi and Oklahoma. The last frontiers were California and Florida. At one point, people talked about space as the last frontier. The idea that there are always new frontiers to make money can be foolish. Sometimes we have to adjust to the fact that we don’t always grow.

PSP: I’ve met a financial consultant named David Schwartz who wrote an interesting article about the philosophy of “more,” compared to the philosophy of “enough.” Most people blindly pursue growth for growth’s sake and end up broke, unhappy and disappointed. Schwartz says, “The philosophy of more is the philosophy of the cancer cell, it destroys the organism it feeds from.” He advises his clients to outgrow the need for more and pursue a philosophy of enough. Perhaps we could learn to adopt this philosophy as a coping tool during this recession.

DiMattia: Exactly. I think it is a good idea during a recession to set a new goal for the business. This means to cut costs enough to keep the business going and sell enough to keep everyone employed. On a personal level, salespeople can set an economic goal to have enough income to maintain their chosen standard of living and a psychological goal to achieve enough self-acceptance to feel good about themselves. The important thing to keep in mind is that we shouldn’t link our lives to some unrealistic standard that demands that trees always grow higher and higher. They don’t grow into the sky. We all need to set ambitious goals for ourselves, but when we don’t achieve them right away, we still can accept ourselves. We all need that self-acceptance to feel good enough about ourselves to get going when times get tough.