Putting The Wind Back In Your Sails
4 Important Consumer Goods Research Initiatives For 2023
Economic slowdowns lead to swift changes in consumer spending patterns.
Based on our Consumer Foresight: Beyond The Pandemic Into Economic Uncertainty tracking research*, we know that more than half of U.S. households were forced to cut back on their household spending in early 2022 as inflation began to soar. Necessary budget items like groceries and other household items, fuel, and healthcare expenses were all on the table for budget tightening, as were discretionary items like eating out, clothing purchases, and travel. As the year has unfolded, these budget cutbacks have spread to more and more households.
As a consumer goods manufacturer feeling the forces of slower consumer spending, the higher cost of goods, and pressures from retailers, you may be struggling with what you can do to sustain the health of your business. One critically important need is to understand the shopper’s and/or consumer’s perspective and what will keep her engaged with your brand.
As we face the headwinds that 2023 will likely bring,
here are 4 types of research to help manufacturers address critical business questions.
Key Question: With downward pricing pressure from retailers and consumers, what retail prices can our product command?
Sophisticated research and analytical techniques help us measure relative demand at a variety of price points. The results of this type of work help companies decide on retail prices that will optimize demand and/or revenue. It can enable sales teams to go into their meetings with retail buyers armed with evidence of shoppers’ interest and acceptance of prices
Key Question: Can we use a lower-cost ingredient and still meet our quality standards?
In-home testing provides clear and actionable feedback on consumer perceptions of product quality and performance. It can be very tempting to change ingredients or suppliers, especially when margins are being squeezed. It’s a risky move, though, and needs to be researched first to ensure that sales won’t plummet if the substitute ingredient doesn’t meet consumer expectations. There’s no better way to do this than having consumers use the product in their homes as they normally would. The best scenario is to test the current product as well as the new formulation(s) and then compare the results. The goal, at a minimum, is parity. If the test product is not at least as good as the current one, don’t make the change. Consumers will notice and business will suffer. Instead, keep looking for alternate ingredients and test again until you meet the minimum threshold on key metrics.
Key Question: What are the core messages that will drive consumer purchases?
Even during a recession (maybe especially then), marketing efforts must continue. One key element is the messaging itself. What features and benefits or specific words and phrases do you highlight to communicate how your product will meet the consumer’s needs? Of course, product marketing is about both rational ideas and emotional connections. It’s important to put into place an effective research program for ongoing assessment of the mix of messages that will motivate a buyer to choose your product.
Key Question: What can our packaging do to help move products from the shelf to the basket?
Packaging often plays a key role in a brand’s marketing plans, especially when ad budgets are small (or nonexistent). A lot of time and money are spent designing the right pack form, visuals, size, and messaging. Some package designs are tried and true with little need for additional research. However, some may leverage new shapes, materials, forms, or dimensions. For some products, you may be designing a new visual identity or highlighting specific claims. Before making any of these types of changes, shopper and/or user input is needed. Several types of package testing can be employed to help ensure that the designs, sizes, and on-pack communications are effective and won’t lead to confusion or other negative outcomes at the shelf.
Final Thoughts
Some of these topics go hand in hand. For example, changing ingredients could lead to lower costs and lower retail prices. Altering package sizes can impact pricing and require updated messaging. The point is that there are research methods to help you make these decisions with confidence, which is always important but can feel even more critical during harder times when the headwinds are strong. The right insights can help put at least some of that wind back in your sails.
Author
Felicia Rogers
Executive Vice President
Felicia Rogers is a dynamic insights consultant who leverages decades of business and consumer research experience. During her career, she has partnered with companies across an array of categories. Felicia began her career in print advertising and has since spent most of her professional life in various consumer insights roles at Decision Analyst. She holds a Bachelor of Business Administration, with a concentration in Marketing, from the University of North Texas.
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