More Halloween Horror!

October 31, 2017

This roll back promotion is certain to please nobody, except a handful of shoppers who were planning to buy the product anyway.

 

 

 

Promotions for household cleaning products are always “tricky”. Consumption is fixed: consumers do not use more cleaners because of a promotion. Therefore, promotions can have three roles only: increase shopper’s average spend, steal share of competitive brands or convince shoppers to shop at your store (or website).

 

What is wrong?

Shoppers will not buy more, they will simply spend less.   

 

Nobody is interested

It’s Halloween! Can we really expect shoppers to be interested in dishwashing liquid, surface cleaners, or, worse … toilet blocks? And very few shoppers will be switching stores or even changing her/his behaviour because of this roll back.

 

Consumption is stable

No-one is going to consume more detergent (or toilet blocks!) because of this promotion. These products are bought because they are needed, not because they are on promotion. Extra sales will be compensated by (long term) stock piling. Dishwash liquid, surface cleaner and toilet blocks are infrequently bought products. Shopper really only buy when they run out of product. Or they stock up. With thanks for the discount, because they were totally prepared to pay full price.

 

Thank you for the discount

It is promotions like these that make shoppers spend less, while they were prepared to pay full price. Discounting in household categories is not a winning strategy. Everyday low standard shelf prices can be a long term strategy. That contributes to shoppers understanding a retailer’s positioning. However, no shopper will say thank you for a price cut of pennies on a very low involvement product.

 

Why do companies run promotions like this?

Brands like Domestos, Fairy and Mr Muscle hope that promotions like these will bring in more shoppers for their brand. And obviously they will also get a market share boost. But this is costly and temporary. From a retailer point of view there are no good reasons, apart from the trade spend received from suppliers. The recommended strategy for categories like these is to reduce the number of promotions and focus on promotions that upgrade shopper spend. 

 

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