The majority of today’s headlines would lead us to believe that consumers’ needs and expectations have changed as a result of economic uncertainty; that today’s consumers are motivated solely by price and promotion. This is a risky assumption. While price is a significant factor for the consumer, we must not neglect other elements that remain important: performance, quality, brand equity and trust.
The tough economic conditions we are experiencing in the UK reminds me of the early years of my career. I joined P&G in 1987 as a regional sales rep in south Yorkshire. The region was still suffering the effects of the miners’ strike and then, like now, the focus turned to price. We found that while consumers made adjustments in the way they shopped – searching out bargains and buying in bulk – they continued to buy trusted brands they had relied on for years.
During that downturn, P&G did not lose focus; it continued to invest in big brands and remained committed to bringing innovations to market.
We must never forget that consumers buy benefits and pay for value. They look to manufacturers, retailers and suppliers to help them save money without sacrificing the big brands they trust. Fundamentally, their needs don’t change during threat of recession, and leaders of our industry must work harder together to communicate and demonstrate value.
We need to continue to delight consumers with innovative products that offer added value, little luxuries or make their lives a bit easier when times are hard.
P&G recently introduced Ariel Excel Gel, which was designed to deliver outstanding cleaning even in a cold water wash cycle. Alongside its reduction in raw materials, packaging, water and energy consumption during its manufacture and distribution, consumers using this product can be assured they’re doing their bit to reduce their environmental and carbon footprint.
It is vital companies don’t just focus on short-term gains, but on the future of our brands. What happens following a recession if we are known only for low prices and have stopped investing in ideas?
In uncertain times, some consumers experiment with cheaper products. But they will never turn away from brands they know and trust to provide value. Data from IRI, Nielsen and P&G’s own studies tell us that across many categories, consumers are reluctant to trade down to lower-cost goods that may not deliver the performance they expect.
History tells us a business that doesn’t focus on innovation fails to move forward, losing sight of the competition and losing touch with consumers. If we provide consumers with reliable, sustainable and value-added products when times are tough, then their loyalty is likely to remain once the economic situation improves and their buying confidence returns.
Ian Radcliffe is director of customer business development at Procter & Gamble.