What does “Value-for-money” really mean?

Consumer Fact:

It is no industry secret that while many consumers (in fact about 80% of the locals whom we have polled) feel that they are the key decision makers in consumerism, the powers of covert influences which would have affected them psychologically prior to that conclusion.

Not so “key” afterall it seems.

Brand loyalty doesn’t necessarily last.

Our study revealed that about 8 in 10 consumers  would stick with their current brands through thick and thin (quite a relief for many brands we believe) but on the flip side of the coin, about 6 in 10 also mentioned that they “would not mind”  or “would consider” switching when offered alternatives.

The math (8 – 6 = 2) illustrates that true brand loyalty is not as strong as we perceived it to be on the surface.  

Switching probabilities were noted to be highest amongst Gen Z (followed by Gen Y) consumers as compared to the others – with the most commonly cited reasons being “Value-for-money” and  “Recommendations from Convenient Sources” (Fear of missing out). One other honourable mention was “Should Try Something New” (or brand fatigue as we know it).

Why is it always about “Value-for-money”?

The phrase “Value-for-money” as we know it today, is a loose construct in consumerism. A conjoint test in our survey revealed that consumers can still be very much influenced by decoy pricing and there are also a number of evidences which seem to point towards the fact that the consumer’s mood has a relatively strong association with the “Value-for-money” aspect in consumerism. Unfortunately, there isn’t a scientific calculation which can accurately measure “Value-for-Money” holistically.

When probed about their definition of “Value-for-money”, many provided generic responses while others simply rephrased “Value-for-money” to “Value received from my money spent”.  Not surprising – considering that the question was not posed to a specific brand from the list. Still, the conclusion that each individual has a different set of expectations towards “Value-for-money” tells us that this could be an untapped potential for many brands to blow their trumpets if only we knew a more encompassing and actionable definition of the phrase.

So we asked about their emotions when they have purchased something which they felt was “Value-for-money”. Interestingly, a large proportion of responses were related to sensations of “happiness” and “accomplishment”. One thing for sure, defining “Value-for-money” as a purchase which a consumer could afford and walks away (or perhaps sitting when buying online) feeling glad and accomplished about it would be a good start.

What is the underlying significance of “Value-for-Money”?

When we tested the relationship between “attributes which consumers felt were important” and their “likelihood of patronage / repeated patronage”, the dimensions of decision-making also seem to be slanted towards “Value-for-money” and “Recommendations from Convenient Sources”.

Knowing what is important to your customers is necessary and knowing what makes them experience that happy sensation would certainly raise the bar in brand experience.

So how should I make my customers “Happy”?

1) First, fulfil your brand promises.

We said, we must fulfil – from the sales pitch to the end product experience.

2) Let your customers guide you.

Your customers will guide your path. They understand their own needs way better than anyone else.  Observing their shopping patterns and perhaps interviewing a few would be a good start. These insights can sharpen your marketing communications and strategies.

3) Stay relevant by assessing the right aspects in your research.

Don’t just measure aspects which are within your customers’ expectations. Uncover which aspect makes them the happiest so that you can flaunt it in your next advertisement.

4) Keep a personal touch with your customers at the right moments.

The emotions of happiness does not stay the same over time. While customers may have the emotion of happiness immediately after a purchase, it may evolve post product experience.

One good way of keeping your customers happy is to simply keep in touch with them. Sending them a note after a couple of weeks from their purchase with a subject header “We hope that you are happy with …” will go a long way.

5) Don’t stop innovating.

The best solution to brand fatigue is none other than innovating – be it a new packaging, a new feature, a new experience or a new campaign, just don’t stop innovating!

Need insights to improve your brand experience? Chat with us!

We run free inexpensive projects for founders, small businesses, social organisations, challenger brands and bold innovators.