Communications can boost brands as consumers remain cautious in recession

Reports of truncated consumer credit streams, shrinking personal wealth, and the reality of job insecurity mean consumers are going to remain reluctant buyers, even after the economy eventually limps back to health.

Reports of truncated consumer credit streams, shrinking personal wealth, and the reality of job insecurity mean consumers are going to remain reluctant buyers, even after the economy eventually limps back to health.

It's not surprising that the current recession would change consumer spending for the long haul, as it did for those who lived through the Great Depression. While advertising teams aggressively push short-term price promotions, communications has a unique opportunity to permanently reshape a brand's standing with a consumer base that is more engaged than ever.

“Consumers are buying less, but they are more open to new options than ever before,” says Dushka Zapata, EVP at Ogilvy PR and head of its San Francisco office. “Because consumers have access to more information than ever, they are taking the time to really research their purchases.”

If permanent spending habits are now being shaped, communications can help brands boldly assert their value for consumers who might be skeptical of ad campaigns, but willing to put their trust in third-party coverage.

For example, Starbucks Coffee, often perceived as a premium indulgence, has recently launched several value-based ad campaigns. Its communications team is supporting these promotions by generating third-party buzz through social networks. It is also reminding consumers why Starbucks' coffee is more expensive than competitors.

“We supported [the recent] $1.95 iced coffee promotion with a radio media tour and using some of the more traditional PR tactics to generate awareness,” says Alisa Martinez, manager of communications at Starbucks. “This was about pricing, but also showing the audience the care that we take with our products. We really wanted to get that quality message in there because it's a differentiating characteristic.”

Overcoming obstacles
The contradictory messages of discount and quality can leave communications with the tricky task of reconciling this disconnect. But the advantage is, consumers are listening closely right now and there are plenty of channels to distribute this message. Starbucks, for example, has more than 200,000 followers on Twitter and more than one million Facebook fans – two channels that have made it easier to get into the minds of consumers.

“We feel pretty certain that we are not going to compete with some people when it comes to price,” Martinez explains. “But we know our customers very well and the kind of value that makes sense for them.”

Yet, trusted brands with a premium bent don't necessarily need to backtrack their message. Consumers are not just looking for quick price promotions; they are also looking for brands that can accommodate their long-term plan to be thriftier.

Tami Jones, associate director of global marketing communications at P&G, says Tide Total Care is focusing its messaging on the detergent's capacity to keep clothes looking new longer.

“We are communicating value with consumers both in monetary terms, and, importantly, the value P&G brands offer in performance,” Jones adds.

Liz Beck, EVP at Cohn & Wolfe, also says that skeptical buyers are now open to learning why certain brands cost more than others – and these explanations are likely to impact their impressions of the brand long after the recession.

C&W worked with client Valvoline on a campaign that guaranteed their customers' engines up to 300,000 miles, if they used the premium motor oil regularly. The intent was to show off the confidence behind the price, even using the company president Sam Mitchell to say Valvoline is “putting its money where its mouth is” in a press release.

“It used to be about trading up and indulging in luxury,” Beck notes. “Now, the tone has changed and it is about building what a brand stands for. Premium brands have a value story; it's just a different kind of value.”

Consumer messages that work during a recession

Consumers might still be willing to pay more for certain items, but likely only if the reason is clearly conveyed.

Cost over time
If a premium product will lead to savings in the long run for a consumer, then this should be emphasized.

Product benefits should be clearly communicated to offset any concerns a consumer might have about price.

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