You only have to visit a town centre high street to see how the world of retail has “embraced” economic uncertainty with window vinyls promoting 25%, 50%, 70% and even an astonishing and somewhat suicidal 95% in one Guildford shop I passed in utter amazement recently.
Slashing prices at a time when customers are more fickle than ever isn’t enough to warrant long term commitment and may only encourage a vicious circle of long-term discounting and dangerous extremes of price elasticity.
Brands can avoid crazy discounting and drive sales and profit by responding to the emotional, as well as the functional, side of the brain. This means retaining the same price but building more into what’s offered for that price – adding value. A good example is O2’s Priority Initiative, which exploits important brand assets to reward existing subscribers while encouraging other mobile phone users to reappraise the relationship they have with their current networks.
With the plethora of value deals around, it’s vital to stand out from the crowd. Experiential marketing allows the delivery of a rich and immersive experience that builds a positive emotional connection with consumers in an environment the brand controls.
Don’t follow the herd and cut costs; think creatively and add value, rather than remove price. This will offer an opportunity to withstand, and possibly even excel in, such difficult times; enabling you to take advantage when those eagerly awaited green shoots take hold.