NEW YORK: Price is reaffirming its centrality as a purchase driver among US shoppers, a trend undermining the role of brands and innovation, a survey of marketers has revealed.
The Fuqua School of Business, part of Duke University, polled 531 executives, and found 24.7% agreed quality would be consumers' main priority during the coming 12 months, down from 26.3% in February this year. These totals hit 21.4% and 18.8% for service.
Innovation saw a slide from 10% to 9.4% here, while the perceived importance of brands fell from 7.5% to 6.8%. By contrast, low prices logged 23.2% in the latest research round, versus 16.4% in February.
Such results were largely consistent with mutual decreases in sales, off by 0.8 percentage points to 4%, and profits, off by 0.6% to 3.3% in all.
More broadly, 56.1% of the sample predicted purchase volumes should increase, 52.5% stated that customers were likely to acquire greater amounts of related goods and services from their firm.
Only 45.4% of interviewees believed their company was now better able to retain customers, 43% thought new buyers would enter the market and 30.4% expected prices to rise. On each of these five metrics, scores contracted by at least seven percentage points.
When assessing marketing return on investment, participants estimated that performance had improved by 3.2% in the last year, a decline from the level of 3.5% posted in February.
Similarly, although brand value was reported to have expanded by 3.4%, this marked a modest dip from 4.1% over the same period. Such figures stood at 3.8% and 3.3% for customer acquisition, versus the 2.2% and 2% increases for customer retention.
Upon discussing marketing expenditure, traditional media adspend was forecast to fall by 1.9% in the next year, as internet advertising sees a 9.4% lift.
Outgoings on new product introductions were pegged to rise by 9.4%, with customer relationship management up by 9%, brand building by 9%, marketing research by 8.2% and the launch of new services by 6.4%.
Social media currently takes 7.6% of marketing outlay, a share set to reach 10.7% over the next 12 months. However, just 6.8% of firms believe this channel is "very integrated" with other media at present.
As a percentage of revenue, marketing investment rates as a whole will equate to 11.4% of sales, an amount that had come in at 10.4% in February 2012.
Data sourced from Fuqua School of Business; additional content by Warc staff