Saturday, March 12, 2011

Is Cheap the New Premium?

Oxymoronically, premium is becoming value as price wars and the ever democratization of premium continues to expand and infiltrate every aspect of our lives.

Product quality aside, what are our premium brands delivering to the consumer beyond a name and quality perception? In these times in which brand value is being reconsidered and redefined this might not be enough. From cereals to cheese, the reality is that people are looking for a better deal or a different kind of value.

Some of our options:
• We play the how-low-can-you-go game and self cannibalize. Yes, many are making money this way, i.e. beer manufacturers like Kirin, Sapporo, Asahi and their race to launch lower alcohol, lower carb, and lower priced "beers" has proven successful and profitable, until someone else comes with an even cheaper option. This is where Google steps in: Free Beer, with an add or two.
• Listen and look around to our world, and innovate. Hybrid, Organic, Social, Mobile, are all examples of how value has been brought to an audience hungry for something different. Is not far fetched anymore, it is here and it is more profitable every day.

Seventh Generation's new detergent bottle is made of recycled cardboard and newspaper...I love when brands put their money where their mouth is.

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