Sunday, May 24, 2009

Survival of the fittest

You all must be aware of the theory of survival of the fittest.Which means only the fittest organisms will prevail. So too with brands. During this economic slowdown the brands which can innovate and can give higher value to customers will only survive.

Consumers have become smarter and tougher. Consumers are now asking harder questions to themselves. “Do we really need it?” “If we need it, do we need it right now, or can we wait to purchase it?” At last: “Do we even want it?
So what should marketers do???

Is lowering the price only way out to add value??

I say no…

In a down economy, marketers think a lot about price. They think that since times are tough, people care about price and nothing but price.
Of course, people actually care more about value. They care about value more than they used to because they can’t afford to overpay, they don’t want to make a mistake with their money.

An easy mathematical equation

Value = benefit/price.
That means that one way to make value go up is to lower price, right?
The thing is, there’s another way to make the value go up. Increase what you give. Increase quality and quantity. Increase the benefit and the value will go up.

Vodafone understands this concept very well and that is why they are not going for any price cuts rather they are emphasising more on creating value for the customers with the help of value added services they are increasing the benefit.(Vodafone new tvc characters zoozoos are to promote value added services)

Vodafone is spending profoundly to promote value added services .Vodafone is not decreasing the price instead increasing the benefit which will result in greater value.

Mistri diagnosis

When the going gets tough, customers get tough too. They start to pay closer attention. They start to demand more.
Smart marketers should see this as an opportunity and act on it by strengthening their brands to take advantage of the contracting economy. Its time when weak brands get eliminated and the strong brands gain stronger foot hold. Companies like Vodafone which increase their media spending during recession times will reap the benefits during upturn.

Author: Sanjay

4 comments:

  1. A nice read and a very good diagnosis.

    Cheers

    ReplyDelete
  2. Well i agree totally to Charles Darwin theory of life that" only the survial of fittest is there" and this principles applies for all ... just like vodafone accepted and applied this theory its doing good and if other brand follow the same they mightdo good too.

    nice writeup as usal
    keep it up

    cheers

    ReplyDelete
  3. its definitely a diagnosis from a completely different point of view. In a n era of slowdown where any of the marketers can not think of anything but cutting the costs and consequently reducing the prices, increasing value for the customers for the same old price is something really innovative which will prove to be beneficial in the long run. that is the reason vodafone as an edge over the competetors. its yhe most apt example.

    a delightful read for every branding professional.

    buck up.

    ReplyDelete

 
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