Posted by Tina Manikas, Global Retail and Promotions Officer
Consumers are not just tightening their belts these days, they're actually going to a smaller belt size. We know a lot of the facts. Discretionary spending down 40%. Home values down. The credit crunch, rising unemployment. The cost of energy. But this is really giving birth to new consumer behavior. Both consumers as consumers and how they behave as shoppers. There's a lot less dining out. They're canceling vacations or postponing them. They're replacing their out-of-home entertainment with in-home entertainment. They're cutting back on groceries.
So how do we promote brand value in these tough economic times?
1) Messaging is really critical. First of all, we need to reframe brand value in a relevant way to shoppers to show a brand's relevance in these times? Is it the smart choice? Is it the affordable treat? Or is it a trust mark where for instance with milk, one of the things we're doing is focusing on the fact that it's nutrient rich. So why pay for empty calories? So while the cost of milk may be going up, it's a way to reinforce our value but reframe it without really discounting the product.
2) Think about added value and how it can be leveraged to drive shoppers to your brand. It's interesting to note some tricks that shoppers use are actually not walking down aisles they've already de-listed in their minds before they even get to the store. So they can forego for instance going down the cleaning aisle, they make their cleaning products last a little longer. So drive them into the aisle with coupons and trials. Drive attention to the fact that you have a portfolio of different sizes within your brand that might meet their needs. So they don't have to choose not to go with your brand, but they may choose to go with a smaller size.
3) Don't forget there's power in a strong brand. Remind consumers there's a risk if they go to something else, even if your brand is more expensive. Be very active in really asserting the value of the brand by reframing that value in a relevant way in the shopper's mind. And not only in the store, where she's making a lot of her choices, but also before the store. Brands and retailers have to work together so together they can win through these tough times.