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By some estimates, consumer spending on essential goods now accounts for 57 cents out of every dollar spent in the U.S., the highest since record keeping began in 1960 and the percentage is expected to grow.
The message to merchants is that “value” has gone from an advertising buzz word to a brand imperative. In previous down turns declining stock markets affected a small portion of the population but this time the impact is much wider eating into the discretionary dollars of even high-income consumers. Lori Senecal, president of McCann Erickson in New York, one of the country’s most influential ad agencies, had this assessment of the current situation, “People are viewing this not as ‘a’ recession, but ‘my’ recession.”
Thus, the necessity for offering outstanding value in everything you sell or provide, but Senecal offered this caveat, “The main thing is to make sure the value proposition is right for these times. More than ever you have to be an advocate for the consumer.”