Last August, our AnxietyIndex research in the U.K. found that concern over the cost of living was on the rise, and the second highest driver of anxiety after the state of the economy. Now, with the U.K. in a double-dip recession, it’s an even worse time to be perceived as a posh place to pick up groceries. So Marks & Spencer—seen as a destination for treats more than everyday goods—recently introduced Simply M&S, a roster of 500 “shopping list favorites” at budget prices. Advertised as “M&S quality now at prices you’ll love,” the new line may help the retailer retain some of its “squeezed middle” customers. Revamped value ranges from supermarkets including Tesco and Morrison’s are also vying for these consumers.
The move is another sign of a trend we termed Navigating the New Normal—the idea that with many economies continuing to struggle, brands will need to retool for highly cost-sensitive consumers, opening up new entry points. While competing on price can be tough for retailers like Marks & Spencer, many consumers are seeking budget options that don’t feel terribly downmarket, giving this upmarket brand some leverage in retaining customers.