Defending Against Low Priced Brands (10 Proven Approaches)

A recent Acupoll? survey indicates U.S. consumers' top priority when looking for products to buy as of mid-April was saving money. Over a third of workers have experienced income loss and 60% have decreased non-essential spending. Even those without lost income are spending less. Financial insecurity is growing around the globe.

This spells trouble for brands with lower priced competitors -- pretty much every national brand. While brands like Purell? and Clorox? will grow despite price premiums, in many CPG and durables categories, low-priced competitors will grow share. In many categories, store brands and other low priced brands have already been gaining share. With growing numbers of financially insecure consumers worldwide, mid and premium priced brands will have to up their game.

Value reframing in marketing communications is one of the best available tools. The goal is to change consumers’ perceptions of your brand from an unnecessary splurge to a smart choice. Value reframing requires no profit-eroding price reduction and no change in product or packaging. It’s all about communication and can be executed very quickly, often with little or no incremental spend. Marketing funds can be re-directed to value reframing messages that may have outsized impact on near-term sales. Value reframing campaigns can impact in-market results within weeks from initial ideation.

Value reframing is well proven to quickly impact results across dozens of categories and brands. In researching this topic over the years, I have identified 10 value reframing approaches:

1.    Make Money No Object – This involves reframing a benefit in a way that is so compelling that price becomes a non-issue. Michelin? “Because So Much is Riding on Your Tires” is my favorite example. Campaign drove +7% growth in year one and became a long-term win for Michelin.

2.    Change Unit of Measure -- This typically involves quoting a smaller unit of measure and a resulting more trivial cost. Pamper's? Morocco communicated cost / night (only 20 cents) to keep baby dry and promote better sleep. This reframe was a key driver of doubling the business in six months. Upon intro of the iMac, Apple? changed the unit of measure to cost / week (on a payment plan) and then trivialized the cost / week by comparing it to the cost of a pizza. Ads said “skip the pizza, get a Mac.”

3.    Use Price to Signal Quality – Highly successful Alpen? Muesli TV ad stated that "consumers love the taste of Alpen?, but ask us to make it cheaper". The ad answers this plea stating “we could make it cheaper, but we’d have to cut down on our fruit, lose the odd nut or two, add cheaper ingredients, but we think you’d notice the difference. That’s why we stick to the Swiss recipe we prefer so you keep the Alpen? taste you prefer”. Tagline: “It’s not the tastiest muesli for nothing”. Campaign drove 30% growth following period of sluggish performance driven by value barriers.

4.    Change Competitive Frame of Reference – This generally involves benchmarking price vs. a far more expensive alternative. DiGiorno? changed competitive reference set from cheaper frozen pizzas to pizza delivery. They secured the #1 position in the frozen pizza category despite a significant premium vs. key frozen competitor. Crest White Strips? was about 10X more expensive vs. Crest? toothpaste, but about 1/10th the price of professional whitening treatments. In-store materials promised "Professional-level whitening at home".

5.    Communicate Mileage Story – This involves demonstrating that your brand goes a longer way than competition. For example, Dawn? washes as many dishes as 2X amount of a cheaper brand.

6.    Encourage Indulgence -- Idea is to give consumers permission to indulge. L’Oreal’s? “Because You’re Worth It” messaging has been highly successful for decades. Small indulgences may do well at this moment in time.

7.    Dramatize Product Differentiation – This can be achieved via dramatization of product itself. Yeti? coolers are “built with the same material as a whitewater kayak… this is more costly, but result is a cooler with a dramatic advantage" that will last forever. You can also dramatize something about how a product was created or manufactured (e.g., OB? tampons designed by a woman gynecologist), or can include other claims that lend credence to product superiority (e.g., Honeywell? Air Purifier: The Doctor's Choice).

8.    Highlight Other Tradeoffs – When consumers pick a lower cost alternative, what tradeoffs are they making? VW? highlights higher resale value vs. cheaper brands, GE? Reveal lightbulbs highlight 28% less energy use. Britax? Car Seats highlights that 3 of 4 car seats are installed incorrectly; Britax? “Click Tight” installation system ensures correct installation. Nest? thermostat saves so much much energy that it’s “Free in 2 years”. Vimeo? B2B video hosting platform conveys a list of "tradeoffs" required to instead use YouTube's free services (i.e., wastes time with pre-roll ads, more crowded, trolls).

9.    Create Value Enhancing – This can involve inventing totally new language (e.g., Olay? Daily Facials, Orville Redenbacher? Gourmet Popping Corn) or using existing language that cues value (e.g., Curad? Clinical Advances, GE? Energy Smart Lightbulbs).

10. Tell a Value Enhancing Story / Align with a Higher Purpose – When you buy DAWN?, you’re helping save wildlife; When you buy Tom’s? shoes, you’re giving a pair of shoes to someone who can’t afford shoes.

Why pursue value reframing? The alternatives are often unattractive. Brands that get lured into discounting are at risk of being caught in a commodity trap. To quote Nigel Hollis, Chief Global Brand Analyst at Kantar:

“Cost cutting strategies like introducing more air into chocolate, downsizing, or cutting back service often add up to death by 1000 cuts”.

LPA? is now offering virtual value reframing workshops including category-relevant stimulus, best practices based on successful reframing on over 50 brands, guidance on highest potential reframing approaches for specific brands, ideation facilitation and vetting. You will leave with a robust list of value reframing ideas. From there, you can quickly screen ideas via on-line research if desired or trust your gut and put reframing to work in market.