Posts by Michaela Balarinova - Prague

Czech consumers skeptical about packaging claims

czech-food-labelA recent survey conducted by the Czech Agriculture and Food Inspection Authority discovered a skeptical mood among Czech consumers: The percentage of consumers who believe that data on foodstuffs is truthful has dropped from 77 percent in 2005 to 56 percent. Overall, the number of people who don’t pay attention to food packaging data is increasing. In 2005, 49 percent did not read the packaging; now it’s 56 percent. This is driven by lack of faith in brand claims as well as unreadable fonts on packaging.

These results indicate that messages and attitudes communicated by brands here are not authentic and relevant enough. It also shows that the price-oriented communication strategies that many Czech marketers have been using might be weakening their brands’ credibility.

Photo Credit: El Gran Dee

Czech film festival taps into Recessionary Living trend

371662689_55da41e5cb1In projecting Recessionary Living as a 2009 trend, we noted that out-of-home entertainment would suffer as homes became more important entertainment centers. One manifestation of this trend in the Czech Republic can be seen in The Jihlava International Documentary Film Festival’s decision to transmit films directly to households.

The festival, held in late October, had fewer sponsors this year and could secure only three cinema screens, versus six in previous years. To increase audience capacity, organizers negotiated with households willing to host viewers in their living rooms (attendees had to text a code to the festival to get address details); the screening included video of the films’ creators, who speak at the festival. The small viewing groups then discussed the documentary in a homey atmosphere, which in some cases even included home-cooked food.

In the future, such events could serve as a platform for brands to spread word of mouth during a recession.

Photo credit: muffytyrone

Quality certification helps Czech wineries attract tourists

logo_wineWhile Czech tourism was expected to decline this year, the traditional wine-growing region in the south is seeing more visitors. Some of this is due to more Czechs taking staycations (saving money by sticking to their home country instead of traveling abroad), but vintners believe that certification of wineries in the area has also helped. The certification logo—a visual pun on a tulip as a wine glass, using the colors of the Czech flagguarantees the quality of wine cellars, accommodations in the area, restaurants with wine themes, etc. As many as 71 percent of certified facilities have noticed more tourists compared to last year.

At a time when anxiety and fear are prevalent, there’s a demand for safety and security. Cautious consumers want assurance that they’ll get a certain level of quality for their money. With a third-party guarantee of quality, they’re more likely to feel that it’s OK to treat themselves.

In Slovakia, fighting the recession by encouraging consumption?

A major campaign is promoting the notion that higher consumption can help to overcome the recession—and many Slovaks are buying it. Developed by the Club of Slovak Advertising Agencies, the Art Directors Club, the Association of Media Agencies and others, “Fighters Against the Recession” is a non-commercial campaign aimed at spurring the Slovakian economy.2_07a307

Appearing on the Web, social media networks (like Facebook), and TV, as well as print, the ads feature ordinary people buying goods from different product categories. The message: consumption (not production) is driving the economy.

Not everyone is embracing this idea. Four agencies have in fact seceded from the Club of Slovak Advertising Agencies in protest. They argue that the campaign encourages redundant and uncontrolled consumption—precisely the source of the current economic crisis. They consider the campaign reckless and dangerous.

After more than a year of the economic recession, what connotation does “consumption” have? There has been considerable talk about shifts from “I” and consumer-oriented culture to “we” and family-oriented society. Has this change somehow been reversed? What lesson will we—consumers and companies alike—take from the recession?

A Czech brand gets a new spring in its step

botasIt’s conventional marketing wisdom that in frightening economic times, brands can emotionally bond with consumers by reminding them of better times and harking back to consumers’ childhoods. Some marketers have even revived old advertising in order to do that. Now the Czech sport shoe company Botas has gone one step further, reviving the classic product itself.

Botas shoes were launched in 1966, becoming one of the country’s most popular mass-market sneaker brands. But in the ’90s, the brand’s appeal started to fade, and it seemed Botas had a bleak future. Then, in 2005 two design students won a European Design award with a redesign of the shoe. They subsequently collaborated with the company to create a standalone label, “botas 66,” which launched with 13 designs earlier this summer. The students also designed the communication materials and packaging. Significant media interest helped generate free PR, and the collection has been a big success.

This affirms a few established rules for surviving in a recession: Bond with consumers and give them confidence that they can rely on you through the bad times; use social media to help propel word of mouth; and, probably the most important rule, don’t be scared to take risks and innovate.

Czechs are choosing cheap over fresh

cheap-foodA new kind of store has popped up during the recession in the Czech Republic, catering to consumers’ lower budgets for daily purchases. The Cheap Food chain is selling FMCG (fast moving consumer goods) items that are past their “sell by” date or very close to it. Along with food, the 30 Cheap Food stores around the country also sell dry goods that suppliers or other retailers are trying to off-load, so the range of products varies based on what’s up for grabs. The retailer has seen sales jump a whopping 90 percent in the past year.

The growing popularity of Cheap Food seems to indicate that at least some consumers will choose low price over freshness, which had been an increasingly important consideration. This is a challenge for brands that have been communicating freshness as the main benefit. They will need to focus on the relevant distribution channels, or the brand itself may soon be out of date.

Supermarket’s online program lets consumers print daily discount coupons

prague-entryPrague’s chain of Spar supermarkets has launched a special online tool to help consumers deal with the economic crisis. Consumers can print a new discount shopping voucher every day. They can also ask online consultants from the University of Economics in Prague where to invest money, whether or not to get a mortgage and other pressing financial questions.

Another attraction for money-saving consumers is a section called “SmartCounters,” where they can calculate how much electricity they save by using energy-efficient bulbs instead of traditional ones, how much water they save by taking a bath instead of a shower, etc. Interactive tools like these offer consumers not only valuable money-saving opportunities but also peace of mind.

This tailor-made offer applies not only to Spar customers but also to those who shop at the store’s competitors. And that’s not a bad target group at all.

In Prague, recession creates fear and fear creates good business

“Destruction of prices” and “Reaction to the worldwide economical recession,” announce signs on a store window in the middle of Prague. The shoe store, a small local company, admits that this sensationalist tone is intended merely to lure shoppers, and it’s worked for them. Other companies in the Czech Republic are using similar communications strategies, citing the recession as a selling argument. Although this seems to be good for business, consumers have criticized it as unethical.