Many factors cause a consumer to choose one product over another, most notably price, quality and branding.
Recent advertising trends emphasise that consumers are more aware of price than ever before, but why is this and should it really be the main factor to focus on?
Everywhere we go we see and hear businesses competing against each other with price, especially supermarkets. Competition has become so intense that there is now, what I see as a price war between supermarkets, publicly displayed through mediums such as television adverts.
Initially these large chains advertised their low prices to attract consumers, but now the competition is so fierce that they have resorted to comparing each other in attempt to win over other stores’ customers.
Asda took price comparison to an entirely new level when they introduced their ‘we’ll be 10% cheaper or your money back’ campaign. This seems very attractive but the process is incredibly complicated and for the effort it takes, the pennies you recoup are minimal.
In a bid to compete with this Tesco introduced their ‘daily dozen price campaign’, by choosing 12 products and comparing the total price between itself and Asda; obviously with Tesco coming out trumps.
It is likely that the lengthy recession and soaring inflation has made consumers more mindful of their expenditure, and in turn, Waitrose has become more sensitive to this shift
Influential factor
With this in mind, it seems that supermarkets are under the impression that today price is the influential factor in the consumer’s buying decision. So much so that even Waitrose, renowned for not using price as a selling point, has resorted to this marketing strategy, matching thousands of its products to Tesco prices in a bid to win over price-concerned consumers.
In the past Waitrose solely focused on quality in its marketing strategy, positioning itself as a high-end retailer with little or no emphasis on price. This strategy was highly successful until 28 September 2010, when they resorted to joining the ‘price war’ - but why?
It is likely that the lengthy recession and soaring inflation has made consumers more mindful of their expenditure, and in turn, Waitrose has become more sensitive to this shift.
With fewer consumers in the market having a nonchalant attitude towards price, Waitrose has recognised the need to incorporate pricing into its strategy in order to retain these newly price-sensitive consumers. Whether this strategy will be maintained in the long term will depend on the economic climate and whether they will lose their brand recognition for quality and jettison their quality-sensitive customers.
It appears price is gaining prominence in consumers’ buying decisions, causing businesses to shift marketing strategies to retain and expand upon their consumer base. However, for anyone concerned by the apparent relegation in importance of quality, I forecast that this trend will not endure permanently, and it shouldn’t be long before brand and quality are elevated in importance once again.
