For more than twenty years, we’ve had low inflation and low interest rates. Now, following the tight supply conditions and logistic disruptions of the pandemic, war in Ukraine has pushed up the prices of oil and wheat, and inflation has taken off.
No wonder many consumers are reconsidering their brand loyalties. Many are trading down, some for the first time. How can you keep your brand selling well in inflationary times?
One way is to orientate your brand towards saving customers money. For instance, if you sell ruggedized products, work out how much customers will save on not having to replace their units so often and put that right at the top of the benefits list. Or if you sell a really hot pepper sauce you could suggest that your tiny bottle will outlast a bigger but blander sauce, because it’s so hot you only need the teensiest little dot of sauce to jazz up any dish.
Another way is to try to get customers to look at a smaller price than the item itself. For instance, a box of powdered dietary supplement might look expensive, but you could express that as “price per meal”. Beauty treatments could be priced per month, per bath, and so on.
You can also focus on loyalty, of course, by offering a coupon giving existing customers money off their next purchase. It doesn’t have to be a lot, but for consumables or regular purchases, or if you have a broad product line (eg in the home and kitchen category), it can keep them thinking of you next time they need the product.
You might also consider offering a subscription package. For instance, you could offer a monthly coffee or tea subscription. By offering a discount for a six month subscription you’re locking in revenue for a while.
That’s all good for brands, but what happens when your products are primarily impulse purchases? Those, after all, are the purchases that are going to be cut when money is tight.
Do you remember, a while back,we wrote about the irrationality of human beings faced with pricing decisions and discounts? A really deep discount will always get customers. Somehow, it’s the discount that they focus on and not the cost of the product.
You see this at flea markets so often. People will spend $50, but they say to themselves “If I’d paid full price, I would have spent $300”. Even if the $50 is the household budget for the week, they still do it.
Of course you want to limit the discount so your customer is forced to choose. It’s no use saying “come back any time, it will still be on offer”. You need a sign up saying “Sale ends on Monday” – in other words, introduce a sense of urgency.
Normally, that might be in the small print. Right now, you should put it up the top. Really stress that acting now will save your customer however many dollars. Focus them on the saving, not the price, and the urgency. That will get the best results.
As always, we’re happy to show you how to use Vipon to get the best deals in front of the best discount hunter customers!
