Building relationships with savvy shoppers

The shopping experiencet The pressure for best offers and deals has led to a reduction in the effectiveness of sales promotions, forcing brands to develop clever strategies to win consumer’s attention and encourage brand loyalty.

Within the midst of the financial crisis, consumers have become increasingly reliant upon seeking the best deals and offers. In fact, 72.6% of shoppers wait for items to go on sale before making a purchase. With sales promotions proving highly effective in eliciting trial and increasing sales, brands have been more than willing to fulfil consumer demands with frequent deals both in store and online. However, by focusing too much on offering the best bargains, you face the risk of alienating consumers with strategies focused too much on value for money, as opposed to encouraging loyalty.

Last year, Alan Mitchell indicated that retail strategies aimed at changing shopper behaviour had led to the death of the shopping list, replacing it with a “lets see what’s on offer/takes our fancy” attitude. Referred to by Trend Watching as the ‘Dealer Chic’ trend, consumers have subsequently learned to expect special offers and deals, which have now become an integral part of every day life. So, what is the point at which sales and promotions will help you to win over consumers, and thus increase brand loyalty?

The darkside of deals


The ever increasing power of the internet has brought forth a great proliferation of deals and discounts, from voucher sites such as Vouchercodes and Voucher Cloud, to dedicated offer sites including Groupon and Living Social. Changing social attitudes have meant that the discovery of special offers is revered by peers, and social media transparency encourages the sharing of information. However, despite their widespread usage, there are two distinct issues with special offers and deals, that make the apparently enticing route of promotion slightly more unsavoury.

Firstly, in todays over expanded retail market, it is becoming increasingly apparent that sales promotions are not enough to differentiate your brand. With an extensive number of brands cutting prices to attract consumers, and with price transparency leading to higher consumer expectations, you must go one step further to entice consumers to choose your brand over a competitor.

Secondly, by overusing discounts and special offers, you run the risk of devaluing the status of your brand. Marketing Week’s columnist Mark Ritson recently discussed that the ‘commodity competition’ of discounting strategies is leading brands such as French Connection and Thorntons to lose their ‘luxury factor’, negatively altering consumer perspectives through the extensive use of year round sales promotions.

In fact, last year, an unusually high rate of pre-Christmas sales resulted in alienating consumers who had paid full price for a now discounted product, with 56% feeling cheated and angry. More worryingly, 16% of consumers commented that they were unlikely to ever use the offending retailer for future purchases. Therefore, by frequently cheapening products, retailers ultimately risk facing a repetitive cycle of discounting disaster.

Light at the end of the discount tunnel


Despite the downfalls of sales promotions, we do not believe in abolishing deals altogether. Far from it. When used tactically, and targeted correctly, promotions and discounts can be a wonderfully rewarding platform for your consumers. We believe that the method of execution and presentation of offers needs to be revamped, in order to cut through the mass of deals and become a successful differentiation tool.

In line with Mitchell’s viewpoint, the consideration of shopper economics is also vital. A few years ago, Hotcow were tasked with the challenge of raising the profile of Aer Lingus’ £9.99 flight sale, to differentiate from similar competitor promotions. We enlisted the help of 999 people in a mass publicity stunt in Central London, to spread the word about the cheap flights and to enable the brand to stand out and make an impact.

An additional example was performed by Living Social, who adopted experiential tactics to make ordinary taxi journeys surprisingly unique for some lucky passengers. Once inside the branded taxi, consumers were given the opportunity to roll virtual dice and enjoy an exciting mystery Living Social experience, highlighting the value for money experience options available from the online company.

As these campaigns exemplify, special offers combined with experiential techniques create a unique added value, in order to truly stand out and build long-lasting relationships. In order to formulate a strong promotional strategy and develop a loyal customer base, you need to ensure that your promotional efforts are appealing not only in a short term special offer capacity, but also to encourage consumers to repeatedly consider your brand for future purchases.

When planned and executed correctly, experiential marketing is a fantastic tool that can be integrated into your sales promotion strategy. This will not only best convey your message, but also reward consumers at the most appropriate point in the consumer decision journey.

Hotcow have the experience to seamlessly integrate the most appropriate experiential tactics, from guerrilla marketing to PR stunts and product sampling, making your promotion stand out from the crowd and speak for itself.

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