Today's customers and the importance of value

As budget-conscious customers seek value, brands must turn up to land a place in the basket says Nancy

Veart, General Manager, Client Partnerships and Sales

As we venture into 2023, daily life looks familiar once more. But even as the pandemic winds down, aftershocks continue to be felt in the global economy.

Around the world, consumers are changing their shopping behaviours in the face of this somewhat gloomy economic outlook and value is top of mind. As a mother of three, like many others I understand the sheer importance of value when it comes to my weekly shop. Cue the importance of retail media.

Value is top of mind

A study from global consulting firm, Boston Consulting Group, reports that 70 per cent of customers are looking for deals and promotions more often1. Customers are trying to save by cooking at home with almost one in two1 saying they dine in at sit-down restaurants less.

When compared to Australia, as increasing cost of living factors continue to tighten household budgets, customers have become more price sensitive and the importance of value has risen2. Concurrently, a recent survey of grocery buyers saw 43 per cent of customers claiming to buy products on special in response to rising food costs, and these same customers stocked up when products went on promotion3.

Strategic shopping saves

With mounting pressure to make budgets go further, customers are turning to online shopping to manage the cost of their shop², with online offering customers the opportunity to research and compare brands, products and prices before completing their purchase or setting foot in-store. As the number of customers shopping online increased 3.4 per cent, instore visitation still remains critical for shoppers, with an average of 5.7 visits per customer, per month8. For customers, the decision to purchase involves more than saving dollars and cents. While price perception is undeniably important, two thirds of value perception still comes from other factors such as freshness, health and sustainability3. experience, helping brands to give customers greater value.

For brands, the instinct is typically to pull back on ad spend, but we know the importance of continued advertising through a downturn to be the brand that remains top of mind in key moments.

Customers are looking for personalised offers they can use now, while simultaneously earning rewards for later, with 20 per cent increasing their engagement with loyalty and rewards programs as a result of rising prices4.

Keep on the customer journey, don’t go quiet Walking beside customers as they browse, discover and purchase is increasingly important, even through a downturn. For me, it’s brands that stand out that will be top of mind and prompt purchase.

Through retail media, brands have myriad opportunities to show up in the customer journey from sofa to shelf, with targeted campaigns that minimise media wastage.

Get in touch with Cartology to find out more. n

May)N=1021 (Fieldwork: 1st June- 7th June); Qualtrics Consumer Pulse N=1017 (Fieldwork: 1st August- 8th August)

6. https://www.canstarblue.com.au/family-gifts/reward-programs 7. This extract is repurposed from Ritson’s column ‘The best marketers will be upping, not cutting, their budgets’ in Marketing Week, originally published on 6 April 2020. 8. Woolworths Transaction Data26/10/2022 - 24/01/2023 vs. 27/07/2022 - 25/10/2022 (pre period)