How the simplicity of Coles’ Down Down and Everyday strategy changed price perceptions

Coles has revealed the deep analytics that have underpinned the simplicity and success of its Down Down and Everyday campaigns, while its marketing partner Forethought has warned some retailers are missing the crucial link between price-marketing and creative.

Coles’ Dale Preston said mixing everyday pricing with creative prevented “sticker shock”

Dale Preston, Coles’ head of customer voice, said the Down Down strategy evolved over nearly a decade and was the beginning of a journey for the brand that changed price perceptions and took it to level pegging – and then ahead – of Woolworths.

Also speaking at the Mumbrella Retail Marketing Summit Christopher Barry, general manager of consulting at Forethought, said retailers needed to become more sophisticated about the relationship between price perception and creative.

“We know a lot about where we should be placing our creative, what spots we should be buying on above-the-line advertising, what to do in store,” Barry said.

“And we know we have some fantastic creative agencies out there that come up with unbelievable ideas that we can take to market and have some great success with our brands. But what we see, certainly from a marketing science point of view, is that we are not getting scientific enough about what we are saying. We’re not challenging the status quo enough about having rigour behind what we’re going to go to market and talk about. Too many times I just seen continuously straight price-based advertising just flooding the market. But it’s a lot more than just price.”

Barry highlighted how consumers believed that JB Hi-Fi prices were lower than those of stores such as Myer because of its extensive use of yellow and red price stickers, giving the appearance of continuous fire sales, while in actuality prices on some items such as TVs were the same.

“There are price cues and non-price cues that will really impact your ‘price brand’ – something that Coles has really focused on,” he said.

Barry said marketers need to scientifically identify the drivers of choice within both a category and a market, define what the relative importance of those elements were and then build them into both the fabric of the brand and the communications.

“You need to brief the creative agency accordingly, but then you need hold them to account to whether the creative and the ideas they are coming back with are truly going to communicate those things that are most important to either acquiring new customers or maintaining current customers as well,” he said.

While many retailers use price as a driver, the way in which messages about price are communicated results in many people having little idea of the actual prices of FMCG goods, with regular shoppers as oblivious to a price point as people who did not shop at a store at all.

But he warned that price needed to be wedded with a message noting: “You can’t just change your prices and expect things will change.”

Forethought’s Christopher Barry highlighted K Mart’s success story.

He cited K Mart’s experience when they changed prices in store but saw no impact on sales until the price message was married to a creative strategy.

“What it took was actually getting out to market and talking about those changes,” he said.

“And it wasn’t just talking about the actual changes in product, it was also talking about the other non-price related cues that would actually give the comfort in this instance to go to a K Mart store.”

He warned that many retailers were not seeing how a range of different attributes were having an impact on price perception and ultimately whether consumers would step through the doors of the store.

Coles’ Preston said Down Down had evolved into the concept of “Everyday”. This campaign gave the brand more creative freedom to market and break away from consumers’ perceived association between the weekly cycle of products on special and wild price swings.

“You have all of these products bouncing up and down and so from a customer perspective they are asking ‘What is the price?'” Preston said.

“Research said customers were convinced but not really trusting of price within retailers. So the next phase was Everyday and how do you create trust around Everyday?”

He said where consumers’ expectations of a price were below the actual price of a product, it created a feeling of being “ripped off”.

The move to print prices on Everyday items as part of the packaging was part of the creative shift that helped to position Coles as offering cheap and predictable prices with 4,000 items classed as Everyday.

“Imagine if you can get a third of a customer’s basket – a third would be great, maybe even a half – on Everyday products … the fluctuation they see, less sticker shock compared to when things bounce around,” he said.

“Understanding the customers and understanding where their head was at and really trying to say what can we do through our advertising and our pricing strategy linked together to deliver something that really helps customers.”


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