Expert: Buyers preference leans towards basic needs

CEBU, Philippines - As recession becomes an innate concern of most businesses nowadays, an expert from the advertising sector shared counter intuitive measures and coping mechanisms done by their major clients.

In her presentation entitled “The Filipino Consumer in Turbulent Times,” Yolanda Villanueva, chairman of Campaigns Group Manila shared that at these times consumers are coping with recession by scrutinizing brands and looking at the performance and pricing of a particular product before doing a purchase.

“They now accept lesser premiums and they give importance to value for money products and look at performance than the image of the brand and they now shifted from patronizing imported to local, value brands,” said Villanueva.

She said that there have been changes on consumers’ buying behavior because now they prioritize more on their basic needs, they have developed heightened interest to promos and are now doing less impulse buying.

“Consumers have become wiser in terms of their purchases and value is now in. Upscale, mid to low income households have changed their purchase patterns because they now compare brands by reading labels, do less stocking, decreased usage and consumption, do product substitution and dropped usage of not so important items,” said Villanueva.

However, despite these negative implications in the consumer buying behavior, Villanueva stressed that historically crisis is a best time to win because there are several looming opportunities in the marketplace.

Quoting the ten guiding principles of managing 2009 from the McKinsey and Co. study; Villanueva stressed that with the crisis companies must accept brutal facts especially about their financial status to be able to make adjustments in cost within the organization.

“According to our client, recession for them is the best time to do alignments in your objective and goals; leverage multiple growth drivers, as well as optimize advertising and promotion. And since there is competition across various industries, companies must innovate to survive,” she shared.

She said that companies must also drive for unique consumer and shopping analysis as well as do monitoring of competitor strategy and responses and most of all spend more during recession as a counter intuitive strategy to attract the market.

“You have to manage imperatives, develop contingency plans for possible worst case scenarios. But you have to also stay flexible and invest in product developments and promotions,” said Villanueva.

“Focus on consumer value, monitor the pipeline and guard against bad debts. New products should be properly punched and assure that its recession proof. You have to upgrade key talents and drive cost savings harder but explore other potential upsides,” she added.

She said that considering the recession and its impacts to the market, it is inevitable that consumers develop responses such as conscious buying so companies must give in to this need so that they are able to provide the market with more while they pay less.

“You can win even in recession. Even with the many crises that we have undergone, Filipinos have different coping mechanisms from previous cases and we have to learn to leverage from that. Brands continue to have value but they have to engage consumers during these hard times for it is only with understanding their behaviour that they become more loyal to you,” said Villanueva.