By Shaziya Khan, VP & Executive Planning Director (JWT Mumbai)
Budget used to mean cheap. Expensive used to mean classy. The world was divided into cheapskates and spendthrifts. But the old definitions no longer apply. Budget or value is the new smart. (And expensive is the new stupid). Budget spells not only good value for money, but also pretty good quality. Words like accessible, experiential, affordable and hip describe the new value. The new value consumer rejects excess in favor of responsible spending. Modern India’s enormous geographic, demographic and economic shifts drove this revised perception of value. It’s apparent everywhere:
- In the long queues during holiday time, at the budget airline counters, where evidently the upper crust, who travel premium class on business, find it perfectly acceptable to travel budget class on vacation.
- With the woman who has the savvy to wait and buy the latest IT gadget after it’s on sale, or the teen owner of the trendy phone who figured a way to buy it cheaper from the US or Singapore or online from FlipKart.
- From street vendors selling designer label merchandise almost as soon as designers produce it, and from fashion forward street customers who expect no less.
Above all, value means smartness, experiential savvy and cultural cool. There is a new language and set of meanings around value. We call them the five new smart codes of value.
1. Opportunity in the smart name As the mass market evolves it requires new names to describe the changes. These names include: the value segment, the strivers, the aspirers, the emerging markets, or even masstige. These names are laced with opportunity and panache earlier reserved for the premium end of the market. The term value now signals inclusiveness and respect, not just low price.
2. The importance of smart timing Among the many factors that drive purchasing today, timing predominates. Consumers and marketers are engaged in a game played in the world of buzz and WOM (Word of Mouth). It’s a world when certain days or weeks, magical time zones, combined with incentives, persuade consumers to spend. The game includes whatever incentives work, such as 25 percent or even 70 percent off, free add-ons, cheaper flights on weekdays and for off-season holidays, frequent flyer points, coupons and interest-free loans. But what works today may not work tomorrow because in value, as in humor, timing is everything.
3. The smartness of playing one offer against another A generation that just a few decades ago first tasted the sweet life of credit has evolved to a more savvy thrill. It’s learned that playing one option against another provides the satisfaction of winning a superior deal. Comparison-shopping reigns! Excel sheets, charts and even apps that help make comparisons are everywhere – from insurance packages and hotel rates to telecom options and employment offers. The catch phrase of this buyer’s market is, Kitna doge? How much will you give? Squeezing out the best buy is the new normal. Service providers, vendors, sales agents, loan officers, even long-time business partners or potential employers are not exceptions.
4. Being responsible and understated is now smart The benefits of value go beyond the transactional and include the relational or emotional. Post-recession prudence has made value conscious thinking not just permissible but almost aspirational and responsible. Down trading, down sizing, down traveling, down housing, down anything has acquired new age minimalist cachet and approval. Value is associated with responsibility, focus, and even social sensitivity. Bling and showing off has made way for more muted, understated purchase behavior. Package lunches, group discounts, cloth carry bags, local instead of foreign holidays, redemption coupons all point to the responsibility associated with being value conscious.
5. Smart, accessible design leads the way Value consciousness has unleashed a burst of creative design solutions. There is a promising segment, across categories, which focuses on providing premium yet accessible quality. It celebrates the good life – for all. Inclusive, edgy and driving volume, this segment attracts the hottest talent, significant investor support and the most innovative designs. Whether in hospitality, home décor, travel, fashion, personal care, technology, music or the environment, accessible design solutions lead the way.
The new meaning of value is a fascinating shift. Because it operates at several levels, it has set in motion a virtuous cycle. This follows from a sense of entitlement, brought on via exposure and experience. Once consumers have tasted a “happy meal” they feel entitled to similar happy experiences in other purchases. Experience raises expectations and entitlement and it sharpens the skills needed to fulfill new aspirations.
This article was first published in BrandZ India 2014 report.