With the recession having posted significant damages on consumer confidence around the world, BBDO India conducted a study Trading Up, Trading Down which looks at the ways in which brands can respond to marketing challenges post a recession. The study, which takes into account 15,000 consumers across 15 markets, shows a clear difference in sentiment between consumers in the west and those in Asia.
Chris Thomas, chairman and CEO, BBDO Asia Pacific (pictured) explained that the study looks at how consumers, the real drivers of demand, are faring and their response to the current economic environment, and how marketers can leverage that in their communication to be more relevant to consumers. The study has been conducted by BBDO Proximity. In an earlier interview to Campaign India, Thomas had spoken about the agency's plans for Proximity in India. Speaking at the conference on Tuesday, Thomas said Proximity was already involved in campaigns such as the one for Quaker Oats in India and some other campaigns that are currently underway. BBDO plans to formally launch the agency in India in the first quarter of 2010.
The study has found that while confidence among Indian consumers has been hit, they seem to be coping much more positively with the economic challenges and are more confident about their long-term future than Americans. The study has revealed the ways in which consumers’ values have changed as a result of the recession. By understanding these changes and responding appropriately, the study says brands can hope to appeal to more consumers in a more relevant fashion.
The study underlines six key brand responses that marketers can channel on the road to market recovery. These include Control, Relationships, Pleasures, Retreat, Appearances and Causes. Control refers to the need among consumers to have control over their finances. This requires marketers to reframe their brand’s value in terms of performance and utility, work towards being more transparent and align the brand’s presence with the new dynamics of how consumers shop. The study found that despite the recession Indian consumers continued to prioritise quality over cost.
As for 'Relationships', it was found that consumers are falling back on relationships, and family ties. Brands could respond in this environment by fostering relationships, creating new benefits that could help family relationships and work harder to build word of mouth marketing which seemed more genuine to consumers today.
'Pleasures' refers to the little treats that consumers afford themselves in hard times, as compensation. This afforded brands the opportunity to prioritise the role of the sensorial moment, getting the opportunity to create that moment at point of sale and also creating low priced entry points for consumers to experience the brand.
'Retreat' was more of a older generation phenomenon where it was found that consumers were increasingly preferring to stay in, rather than go out when it came to spending their leisure time. This presented an opportunity for marketers to place their brands in a consumer’s daily ritual. The other key brand responses that Thomas spoke about were 'Appearances' and 'Causes'. Increasingly (and this was more true of western consumers than Asian ones), consumers were placing more importance on philanthropic causes than material values which presented brands with the opportunity to align themselves with qualities that reflected those value systems. To align themselves with causes and movements that spoke of such benefits to their community was an area that brands could leverage. Of course, Thomas stressed here that with social media, it was easier than ever for superficial cause alignments to be found out, so brands had to embrace such associations intrinsically, otherwise they would be found out.