Makeover your products / services for a feelgood factor?
22/07/08 11:09 Filed in: News commentary
The Sunday Times published a fun article on the weekend, with perhaps more resonance than meets the eye.
The essence of the article (“amid the credit crunch the arts benefit from the feelgood factor”) was that in times of economic hardship, people tend to purchase more inexpensive products or services that have a disproportionately high impact on lifting the spirits. Think of these as “affordable luxuries”.
Examples include: cinema attendance, cosmetics, mid range restaurants, camping holidays, entertaining at home, traditional toys and games, ABBA music(als).
The really interesting thing is that, even in a downturn, there are pockets of business growth if you bypass the doom and gloom and think creatively. Cinema attendance is up, camping site attendance is up - both by double digit percentages compared with last year. The supermarket aisles of Aldi and Lidl are congested, the tables are full at Pizza Express.
What are the lessons for the rest of us?
(1) Growth can be had in a downturn - it’s not a one-size-fits-all phenomenon.
(2) We can increase our chances of success by exploring how to reposition our products and services to pursue the growth opportunities.
Of course, businesses have to consider the implications e.g. remaining true to what they’re good at, and what their brand values are. It wouldn’t make sense for Rolex to suddenly try to compete with Swatch, for example. But note that Mecedes partnered with Swatch to create Smart cars with a separate brand - and it just so happens that the current waiting list for Smart cars is pretty long (benefitting from the additional trend in high fuel prices).
With some creative thinking there could be significant opportunities to prosper - call us if you need some inspiration!
The essence of the article (“amid the credit crunch the arts benefit from the feelgood factor”) was that in times of economic hardship, people tend to purchase more inexpensive products or services that have a disproportionately high impact on lifting the spirits. Think of these as “affordable luxuries”.
Examples include: cinema attendance, cosmetics, mid range restaurants, camping holidays, entertaining at home, traditional toys and games, ABBA music(als).
The really interesting thing is that, even in a downturn, there are pockets of business growth if you bypass the doom and gloom and think creatively. Cinema attendance is up, camping site attendance is up - both by double digit percentages compared with last year. The supermarket aisles of Aldi and Lidl are congested, the tables are full at Pizza Express.
What are the lessons for the rest of us?
(1) Growth can be had in a downturn - it’s not a one-size-fits-all phenomenon.
(2) We can increase our chances of success by exploring how to reposition our products and services to pursue the growth opportunities.
Of course, businesses have to consider the implications e.g. remaining true to what they’re good at, and what their brand values are. It wouldn’t make sense for Rolex to suddenly try to compete with Swatch, for example. But note that Mecedes partnered with Swatch to create Smart cars with a separate brand - and it just so happens that the current waiting list for Smart cars is pretty long (benefitting from the additional trend in high fuel prices).
With some creative thinking there could be significant opportunities to prosper - call us if you need some inspiration!