Pricing and the polycrisis | WARC | The Feed
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Pricing and the polycrisis
Consumers around the world are feeling the effects of the myriad crises at large in 2023: price and value now define most people’s attitude to buying as brand values continue to lose ground, according to a new report.
Why pricing matters
IPSOS Global Trends 2023* sets up a dichotomy between pricing and purpose, and sketches a world in which brand purpose has become not only less impactful but, as the WARC Toolkit notes, even risky in some markets.
More broadly, IPSOS describes a world more fearful about the future. Economics figures heavily in this thinking, with people now more cautious with their money, especially in developed markets.
Pricing is a critical aspect of marketing, even if that control has been eroded for many marketers; however, the relationship between brand and pricing power is strong.
Pricing, perceptions and personal values
The proportion of people agreeing they buy brands that reflect their personal values has dipped slightly across the board.
- Higher income consumers have changed much less, suggesting that the choice implied in branded items is becoming more of a luxury.
- Among lower income groups, 55% tend to buy brands that reflect their values; 34% disagree. Among higher income consumers, 67% agree and 27% disagree.
Perceptions are shifting, with private label products seeing increased interest and trust. In Europe’s six largest markets, according to data from Circana’s CPG Demand Signals Report, private label now accounts for 39% of products sold. The same report also suggests that the pie is getting smaller, as European unit sales declined 1.3% over the course of 2023.
Broader challenges
- Just 35% of the public surveyed across 31 countries think their quality of life will be much higher in five years’ time compared with today.
- While dealing with the climate crisis remains a priority for global respondents, there has been a cooling in sentiment at a time of rising costs – most worryingly, this dip is strongly pronounced in countries that had been vocal leaders on the issue, such as the UK and Germany.
Key quote
“After a few years where brands with value have grown in appeal, our new economic reality suggests they are becoming more of a luxury for those with the means to choose it,” the report states.
*The study that forms the basis for the report is based on 24,220 interviews across 31 markets.
Sourced from IPSOS, WARC
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