Almost Half of US Consumers Emotionally Indifferent to Brands

Posted by on Jun 5, 2014 in Brand Purpose, Brand Value, CPG, Digital Strategy, innovation, Learning, Loyalty, Shopper Marketing | 0 comments

This headline caught my attention. As it should catch the attention of any of us who are paid to build, protect and develop brand value. We should not dismiss this, like we dismiss it when consumers say they think products should cost less and that they eat less junk food than we know they do. We should not dismiss it, because the green statistics are signs of things that have been – for US marketers – not of things to come. And we need to understand why, and evolve and adjust our not just our marketing strategy…but our product development and entire go-to-market approach. People grow apart for valid reasons. And consumers and brands are growing apart. Or – more precisely – consumers are maturing and doing grown up things, and we marketers are still loitering around the convenient stores, drinking suicides and trying to get better at Asteroids. That consumers are maturing, thanks to increased access to information and a ton more choices, is not a tragedy! Rather, it is the opportunity of a lifetime – for all of us. Empowered, informed consumers create the context we’ve all been dreaming of…a chance to have a deeper, more meaningful, sustainable, efficient and longer lasting consumer relationship (which is also, by the way, the real definition of “brand loyalty”) . Susan O’Neal Gear has over 20 years of experience at the intersection of consumers, marketing and technology. Passionate about all aspects of a consumer’s relationship with brands and retailers, we’re spending the next year looking for new, groundbreaking thought leadership – if not disruptive solutions – with the potential to redefine the parameters of consumer loyalty. If you also want to see some game changing happen -then follow Upstream Insight, contribute your voice, share this post…do...

Read More

What is Robinson-Patman and Why Should You Care?

Posted by on Apr 9, 2014 in Burnout, CPG, Digital Coupon, Digital Strategy, Load to Card, Loyalty, Robinson-Patman, Shopper Marketing, Sliderpostings | 0 comments

In 1936 the U.S. Congress passed the Anti-Price Discrimination Act (more commonly referred to as the Robinson-Patman Act). The intent was to prevent unfair price discrimination by requiring that sellers of products offer the same price terms to customers at a given level of trade.  Under the Act, it is illegal for the manufacturer of a product to sell to one retailer for a different price than that retailers similarly sized competitor. Volume discount is one form of price discrimination that is allowed under the law. In fact, as far as I can ascertain, it is the only form of price discrimination allowed by the law – even though one could imagine other reasons a product manufacturer might desire to give a smaller retailer preferable pricing (better store position, positive brand associations, other?). When a retailer qualifies for the lowest (or among the lowest) price from the manufacturer, based on their volume, they can take those discounts and pass them along in the form of a lower price to their customer.  (Note: These “volume discounts” are more commonly referred to as a retailer’s “trade budget” from a given manufacturer and are also often applied to co-marketing and other mutually beneficial applications…but for the point I’m trying to make here, I’m going to continue to refer to this money as a discount to the product price). When a retailer is big enough to be the leading volume seller across many categories, and by a pretty significant margin, as Walmart has been for some time – we call their strategy for winning over price conscious consumers an Every Day Low Pricing Strategy (EDLP). Because of Walmart’s size, it has proven to be a sustainable competitive advantage – made possible primarily thanks to Robinson-Patman. For the price-sensitive consumer, it is hard to beat an EDLP strategy – but combined with other positive attributes, such as a more pleasant shopping experience, supermarkets have had success over the years with the following alternatives: Hi-Lo– Retailer places some high interest items on deep discount and promotes them, enough to draw the consumer into the store, then makes up revenue and profit margin on the other items consumers may pick up in the same trip. All retailers do this to varying degrees, some better than others. BOGO – A form of “Hi-Lo”, BOGO stands for “Buy One Get One Free” and it has been around for a long time. Consumers love it, partially because it involves the word “FREE” (always gets people’s attention) – but also because the consumer value proposition of a BOGO strategy involves low work and high reward…almost as good as EDLP (no couponing, no special cards, few conditions to meet). BOGO as...

Read More