By Robert Wheatley

Race to reduce may deepen the floor…

Coupons and deals are everywhere. If everything is on deal all the time, then certainly there’s no distinctiveness to be found in the deal. The deal soon becomes the new floor. And the floor may stick over time: 10 percent down is the new flat?

Last time we looked a dollar still had a hundred cents in it. So the deal dollars come off the top of the budget, making the remaining kettle of funds smaller. And in the interest of achieving volume goals, the margin side of the P&L takes a hit. But we all know that margins are dear to owners, be they investors of the public variety or families and individuals of the private kind.

In the end profits get restored and budgets shrink to accommodate. Fewer dollars then are available for innovation, research into consumer behaviors and needs and other tools used to build equity and attract new business. The steamroll effect of this can leave brands vulnerable to rivals less enamored with habitual deep discounting.

Value re-defined

Value is not just price. Valuable-ness comes from relevance to the consumer’s needs. And in a difficult economy, finding the relationship footing with consumers who wield tighter wallets means that value can still translate effectively when looked at through a lens that sees beyond coupons and discounts. Here are three paths:

1. In parallel
Procter and Gamble has deployed the formula for this in their Tide Total Care campaign. The twist on value is helping consumers get more mileage out of their clothing investment. The value message is there but not tied solely to price as motivator to buy. Is there a value proposition that runs alongside the benefits of product use?

2. Empathy
Hyundai’s Buyer Assurance Program, now imitated by other auto brands, aims to put the brand in league with the real world concerns of buyers. It says I know what you’re facing and I’m there with you. We can help take the risk out of this major purchase. How can you mine alignment with uncertainty and anxiety in tangible, meaningful ways that tell consumers you understand their plight?

3. Emotion
Consumers may try to remain objective in times like these, but we are emotional creatures and will respond with the heart as much as the head. We know people are spending more time with families, eating at home more often, looking for those areas where control can still be exerted. Simple pleasures and moments of gratification that offer comfort and social interaction can be powerful when everything else looks uncertain. Can you sync up with the emotional tenor of the moment and link brand use to enabling occasions of escape, enjoyment and serenity?