Knowledge Bank Blog, Pricing & Promotions, Shopper Communication

Value Shortcuts

Let’s start with a question…

Imagine that the UK is preparing for an outbreak of a new disease. The disease is expected to kill 600 people.

Two alternative programmes to combat the disease have been proposed. Scientists have modelled the consequences of each programme.

If Programme A is adopted, 200 people will be saved.

If Programme B is adopted, there is a one third probability that 600 people will be saved and a two thirds probability that no people will be saved.

Which programme would you choose?

If you’re like most people, you probably chose Programme A. You preferred the certain option over the gamble.

What if we try a second version…

If Programme A is adopted, 400 people will die.

If Programme B is adopted, there is a one third probability that nobody will die and a two thirds probability that 600 people will die.

If you’re like most people, you probably chose Programme B. You preferred the gamble that nobody might die than the certain option that 400 people would die.

Now look again at the two versions.

The consequences of the two ‘A’ programmes are identical (as are both ‘B’ options). In both ‘A’ options 200 people will be saved and 400 will die.

Exactly the same consequences. Just framed differently.

Why are we talking about this? We are all very influenced by how choices are presented. The same choice can be presented in different ways and lead to very different outcomes.

This is particularly true for shoppers in a busy store or online environment. They don’t have the time, energy or mental arithmetic skills to analyse every purchase decision.

So they rely on simple shortcuts when deciding what to buy.

These shortcuts are at the centre of a battle. Between retailers. Between brands. Sometimes between retailers and brands.

The winners of the battle will be the ones who give shoppers the most effective value shortcuts. Simple things that signal a product is really good value.

So, what are some of the value shortcuts you could use?

You could signal to shoppers they are getting more for their money. That your product goes further. Lasts longer. Contains a lot of servings.

Think about what your “more for your money” angle is. Then think about how best to frame it. For instance, you could tell shoppers that the pack contains 100 tea bags OR you could say that it is 100 cups of tea. 100 bags is a pack size. 100 cups of tea are 100 tea moments. A lot more motivating.

You could signal to shoppers they are saving more. It could be a direct saving. Buy a superior product and you need to use less of it. It could be an indirect saving. Wash colder and save on your energy bill.

Too often we associate “save” with less money. But “save” can mean “less time,” “less effort,” “less usage.” Broaden how you think about it and you broaden your communication options.

You could signal to shoppers that you’re worth paying for. That your product is better. That lots of other shoppers think it is better. That independent, trusted sources think it is better (e.g. recommended by dentists).

That your product is one that shoppers shouldn’t compromise on. Because the performance of the product really matters. Think personal care products. Because the taste of the product really matters. Think many food categories. Because the product experience really matters. Think spirits and mixers.

If you’re worth paying for, tell shoppers. Otherwise they will just buy something cheaper.

You could signal to shoppers how versatile your product is. That you could be used for more tasks. Think household products. That you could be used for more meals. Think sauces & condiments. That you could be used for more occasions across the day. Think snacks. That you can be used with other products. Think yoghurt.

But remember… make sure your versatility is relevant. A jack of all trades is a master of none.

You could signal to shoppers that you compare well. Again, this could be indirect. That the Indian meal box compares well to going out for a curry. That your drink at home compares well to buying it in a bar or café. That your product (e.g. detergent, fabric conditioner, deodorant) compares well to buying new clothes.

Or it could be direct. Your product delivers as well but it’s half the price. Aldi are the absolute masters of using this framing to signal value to shoppers.

How you present choices has always mattered.

It matters even more right now.

We’re in the middle of a value battle. Value shortcuts are our ammunition.

Feel free to forward. Have a great weekend. Speak to you in fortnight.