Last week, Stuart Elliott at The New York Times wrote about how marketers are aggressively going after thrift-minded consumers. The most obvious solution—one we’ve documented in a number of brand cases—is simply to make prices more competitive. Recently, Procter & Gamble said it plans to do just that, cutting prices in categories where its brands are seen as relatively costly and developing more lower-priced products.
Nonetheless, one of its new product lines is going in the opposite direction: Olay Professional Pro-X skin care products cost $42 to $62 per item, two or three times as much as products in another Olay line, Total Effects. Despite this, P&G’s messaging for Professional Pro-X is about value. A print campaign set to launch in July will be headlined: “As effective at wrinkle reduction as what the doctor prescribed. At half the price.”
This strategy strikes at an important distinction that all marketers should remember: In a recession, cost-cutting can sometimes be the knee-jerk solution, but it’s not always the best one. For some brands, a better idea may be to communicate relative value.
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