There has been much speculation about the harm that has been done to brand loyalty over the past three years, as the Great Recession caused many consumers to consider true benefits and needs against casual preferences and wants. This greater consideration for price and “trading down” is summarized well in a study from comScore, explained in yesterday’s Research Brief from Media Post. Click here to read the story.
Implications: While the focus of this comScore research was primarily packaged goods, I’m thinking about the wider realm of consumer purchasing right now. From automobiles to restaurants, from shoes to office supplies and everything in between, we can agree that many consumers were more price-sensitive during the great recession. Indeed, the Research Brief story suggests that the focus on “benefit versus brand” was beginning even before the recession.
In return for this focus, consumers were rewarded by many packaged goods companies with steep discounts on branded goods, as companies worked to mitigate the effects of the recession on their brand sales.
Now, as the recovery takes hold, companies focus not just on retention, but customer re-acquisition (bringing consumers who may have abandoned their brand for cost-savings back to the fold).
Where does your company sit on the name brand/value alternative spectrum? Whether you are a restaurateur, car dealership, bank, grocer, furniture store, doctor… did you benefit from the shift to value-focus during the recession? If so, should you be thinking about how to keep those consumers you acquired from going back to their previous habits? Or, were your products and services among the revenue casualties of the economic downturn? Do your customer acquisition efforts include a “welcome back” re-acquisition plan?