Competition prizes or crazy prices?

News International and Starbucks have probably suffered most recently. Then last month it hit the supermarkets. First horse meat burgers and then last weeks Dispatches on Channel 4 proving that customers are developing more distrust about price promotions. Trust… high on the agenda again for everybody.

To be honest, I’m not sure how much damage the horse meat saga will have to Tesco’s, never mind supermarkets, and I’m not going to stop buying a coffee in Costa because Starbucks didn’t pay tax. But price promotions, as highlighted on TV last week, that’s potentially a huge issue because in some cases it demonstrates blatant deceit in how supermarkets are pricing products in order to confuse shoppers. And it’s giving promotions in general a bad name.

And the con all seems so easy:

Product x is valued at £1 It’s priced at £2 but sold on a 3for2 offer to still ensure it shifts. Then, they run an amazing half price promotion at £1 and sell bucket loads…all allegedly of course.

What I find most annoying is that this deceitful discounting activity is still constantly being referred to as “promotions”. At Unmissable we also work in “promotions” but we spend all our time and energy in helping brands run promotions that excite, engage with the consumer and add value with competition prizes. Sales promotion has moved from the poor cousin of advertising 10 years ago to a strategic discipline that doesn’t just encourage brand switching but builds customer loyalty. We have momentum and trust at the moment. But like Costa taking a bigger slice of the pie from Starbucks, it’s the above the line budget that will increase if price discounts get tagged as promotions while the consumer is increasingly losing trust.

It’ll happen alright, trust me.

Justine Clement 30th Jan 2013

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