What did CES 2023 offer up in the current cost of living era?

CES is the annual (notwithstanding Covid) tech industry gathering in Las Vegas that showcases the latest technology and products in the consumer electronics industry. Did the 2023 show present any hope for consumers struggling with cost of living pressures?

Recent Gekko research revealed that the cost of living crisis has had a dramatic impact on consumer spending with 66% slash spending on non-essential considered purchases and 43% on essential items. On a day-to-day basis, the main priority for many is ensuring that the bills can be paid and as a result, a large proportion of homeowners are looking for ways to save money, whether that’s cutting back on the heating or even switching appliances to save on electricity.

So, against this backdrop, we watched with interest for the big reveals and announcements that were coming out of CES in the first week of January to see what might appeal to cost-conscious consumers thinking of investing in money-saving and more efficient solutions for the home.

It’s no surprise that a tech giant like Samsung managed to grab headlines at CES and the updates to their smart home solution certainly presents some tangible savings for homeowners. Samsung’s SmartThings Energy and in particular their new AI Energy Mode which offers support for more devices and regions with even more significant savings. This new update includes 15% more energy consumption savings for compatible refrigerators, up to 20% for compatible air conditions and up to 35% for compatible washers on selected cycles. This update will allow the user to save electricity on these products which equates to savings on the user’s energy bill. The SmartThings Energy service which can be viewed on the SmartThings app available on both Android and iOS can show the energy consumption of the user’s SmartThings products and how much the estimated cost is. You can view this by day, week or month and it will even break down the energy consumption per hour. This app is very handy to keep track of the “Demon Appliances”.

If multitasking is your thing then a desk, bike, and computer combo might just appeal, with the added benefit of saving yourself a bit more money on your electricity bill. The eKinekt BD 3 from computing brand Acer addresses this somewhat niche requirement. They have branched out into the world of fitness with their eKinekt BD 3 exercise bike which is designed to be a desk, where the user can work and exercise at the same time whilst also producing electricity that can power the user’s laptop. Acer stated that cycling at a somewhat leisurely pace of 60 RPM (revolutions per minute) for an hour can generate up to 75 watts of power.

Moving out into the garden, a new solution to tackle water wastage was announced. The Moen Smart Sprinkler Controller can monitor the moisture levels of your soil and tracks local weather conditions. The user can also monitor water usage and estimated savings as well as set up customised watering schedules that take advantage of weather tracking so the sprinkler will not activate if the rain is predicted in the area which in turn will save the user money. Thinking about the UK 2022 summer drought, this kind of solution would certainly help users become more efficient in their use of water, cutting consumption, wastage and cost.

Although not announced at CES, something that has been gathering a lot of momentum recently and will be featured on the spec sheets of many new products revealed at CES is Matter, a new proprietary standard for home automation that has the potential to offer indirect savings for consumers. Matter is essentially Smart Home 2.0. In simple terms Matter is a new wireless standard that should unify the smart home and make operation easier for users. This means that every smart device you may have such as a smart plug or smart light will talk to each other as opposed to how it used to work with each device being locked to that specific manufacturer and then locked to a specific control centre such as Google Home or Apple Homekit. Until now, with non-compatible standards, consumers have essentially been locked into a brand/product’s ecosystem if they want full functionality. However, now the user will be free to mix and match and not worry about losing the functionality of their products because they’re mixing manufacturers, this, in turn, will save the consumer money as they can take advantage of sales rather than having to wait for that one specific product to drop in price as there are always alternatives for every smart home product.

This is by no means a conclusive list of products that can help consumers save on their household utility bills but rather some of the notable ones that we saw coming out of CES2023. There are of course other products either already available or coming onto the market that can assist with saving on energy consumption. From smart plugs that can be turned on and off remotely so helping users cut down on energy consumption to readily available smart light bulbs, which being LED, offer immediate tangible savings over traditional light bulbs.

CES 2023 was a step in the right direction for sustainability and pro-consumerism, with a lot of companies focussing on the overall sustainability of their products and ensuring that energy consumption is kept to a minimum as in these current times saving money on the electricity bill is a must. This all ties in with the increased industry focus on home appliances and energy saving. In the UK trade body AMDEA is educating the home appliance retail sector on how consumers can make savings when using products as part of its highly successful Know Watt’s What campaign in helping combat energy price rises.

In terms of pro-consumerism, one of the most important updates to come from CES 2023 as mentioned earlier is Matter which opens up the opportunity for consumers not to be tied down to specific manufacturers and allows full Smart Home Freedom. Expect smart home brands to be increasingly vocal about their Matter integration and compatibility.

You can read more by Callum Puffett, Marketing Executive by visiting Gekko News
Photo by CES

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How brands can stay front of mind in an era of continuous disruption

Daniel Todaro, managing director at creative customer experience marketing agency Gekko, advises readers on what is driving consumers during these difficult times and how brands might best react.

We are living in an era of significant disruption, requiring an updated approach to brand communication in sync with our times. The question is do brands need to redefine their raison d’etre to stay relevant to appeal to very changed consumers?

A new paradigm

The pandemic’s cultural legacy has been a shift to a life where many of us are at home more and need products and services that cater to a new stay at home existence. Meanwhile, the aftershocks of the pandemic have caused huge inflationary pressures impacting many. This has created a new economic reality where affordability trumps desirability.

In a recent research study we carried out with YouGov we interviewed a cross section of consumers throughout the country to understand what is now driving purchasing behaviour. We uncovered five key motivating factors driving purchasing behaviour at this time. Brands need to respond to these if they want to remain front of mind for modern consumers.

1) Value for money
In a world of soaring costs and stagnant wages, consumers revealed that one of their key reasons for making a considered purchase was the value for money a product offered. Brands should react by smartly promoting the long-term savings they can offer.

For example, AMDEA, the body representing the white goods industry in the UK, did some research in relation to the Eco buttons on washing machines and dishwashers. They revealed it was saving consumers on average £90 a year. They now really highlight this facet to drive consumers in store to purchase their members’ products.

2) Essential trumps desirable
Positioning your brand and products as ‘essential’ items in the psyche of your target audience is a second key factor, also borne out by our research. The days of assuming there is an implied need for your brand are no longer present.

Disposable income in all households, even middle earners, is becoming scarcer. The ONS has estimated the biggest fall in living standards in 2022/23 since records began. Consumers may want your product, but unless it’s absolutely essential and integral to their life, they are not going to buy it. So why is this going to be a product they can’t live without?

3) Durability
As an extension to being essential, people will need to feel that the item that they are buying is built to last for more than the lifespan of your average reality star. Low down on our list of drivers in today’s climate are more ephemeral qualities like perceived ‘brand value’.

Rather than offering a lifestyle associated with a brand, a brand should focus on the quality of their products. This should be the starting place for a conversation about a brand and how it will last for someone whose budget is going to be squeezed for some time.

4) Sustainability
The longer something lasts, of course the more sustainable it is, and this is a huge driver for younger generations in particular. Far from moving away from this priority at a cash strapped time, consumers are in fact doubling down. Brands should be wary of greenwashing and understanding this generation will do their research about the full life cycle of a product.

5) Innovation
Finally, innovation was identified as the fifth key driver of consumer purchasing behaviour in the current climate. This is why Google has attracted new customers with both the value of their Pixel phone but also its innovative Magic Eraser functionality.

Indeed, innovation plus value has also been a key driver of the demand for air fryers. According to research by price comparison website PriceRunner, demand has soared by 3,000 per cent since 2021. The money that can be saved through cooking at a time of rising energy costs is significant and of course energy efficient.

The air fryer also answers several other current consumer need states. We, post-Covid, are eating at home more and it is a way of getting your family, your friends and your kids involved. It is also healthier.

It is crucial that brands adapt to remain relevant. For some this will require a radical step change. As author Mandy Hale put it: “Change is painful, but nothing is as painful as staying stuck somewhere you don’t belong.”

To read the full article please visit Transform Magazine
Photo by freestocks on Unsplash

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Adapting For The Peak Season & Beyond

The Festive period is here and every retailer is gearing up for a rather different Christmas than we may have considered normal, the Christmas cookie-cutter approach is no longer relevant and adapting to your local audience is critical to success. We are living in a time of significant disruption and reimagined stability, requiring an updated approach to brand communication in sync with our times, a more cost and sustainable time. Established brand value propositions built up over many years are increasingly becoming irrelevant in a world reeling from a pandemic, a nonsensical war in Europe, embedded inflation and a recent economic crisis. The retail environment we all knew as recently as 2019 is becoming more like a faded memory of a bygone era.

The question is do brands and retailers need to redefine their appeal to stay relevant to a shifting consumer appetite based primarily on economic and environmentally, socially relevant trends? Particularly when facing a predicted period of prolonged economic downturn throughout the world, making the most of this festive trading period is essential in order to capitalise on the nation’s consumers’ appetite to shop either for themselves or as gifting.

A New Paradigm

Due to the change in how we lived that we experienced recently, the legacy lives on and our needs have been radically redefined. The pandemic’s cultural legacy has been a shift to a life where many of us are at home more and need products and services that cater to a new stay-at-home existence.

Meanwhile, the aftershocks of the pandemic and political instability and market fluctuations have caused enormous inflationary pressures impacting many. This has created a new economic reality where affordability trumps desirability in the purchasing behaviour of millions. Including those who perhaps considered themselves more ‘well off’.

The climate crisis is also front of mind and certainly hasn’t dissipated despite the more immediate worries. Events like COP 27 educate us to do more by increasing awareness and encouraging changes in living habits.

For every retailer, a new brand playbook is needed for this new age. Our understanding of consumer behaviours is understood better through research. A recent study we conducted with YouGov pointed to five key motivating factors driving consumers’ intent to purchase. These may assist to ring in the cheer for your store during this ‘peak’ period.

1) Affordability

In a survey of 2,000 consumers, we asked people what were the key drivers that would persuade them to make a considered purchase? The number one reason, perhaps unsurprisingly, was that it was within their budget. I recently spoke at the ERT Turning Point conference alongside AMDEA, the body that represents the white goods industry in the UK who did some research in relation to the Eco buttons on washing machines and dishwashers etc.

They revealed it was saving consumers on average £90 a year. They now really highlight this facet to drive consumers in-store to purchase their members’ products. Knowing that affordability is a critical criteria for consumers, brands can smartly promote the long-term savings they can offer. Perhaps paying back the cost of the appliance within five years. When you multiply these savings across several appliances in the home, you can see how the savings increase.

Furthermore, the energy-saving ‘eco’ modes can provide a win/ win of appealing to sustainability-minded consumers, particularly Gen Z, who also want to save money and the planet, as we all should be focussed on. Retailers can also benefit by highlighting appliances with these features as part of their promotional marketing as more and more consumers are having to rely on eco settings to reduce energy bills.

2) Essential Trumps Desirable

For 73% of consumers in our survey, the idea that a product was ‘essential’ was a key reason they would consider a considered purchase. Therefore positioning your products ranged as ‘essential’ items in the psyche of your target audience is important as part of the marketing mix.

Perhaps the days of assuming there is an implied need for the categories are no longer relevant due to changing consumer lifestyle and habits. Disposable income in all households, even middle earners, is becoming more scarce. They may want a product. That desire may be there. They may covet it. They may feel that they need it, but unless it’s absolutely essential and integral to their life, they are not going to buy it. At least not just yet maybe, unless you can convince them otherwise. Think about how you do this.

The lesson is therefore highlighting why your ranges are ‘essential’ to their needs. It is not so much that it may be that there’s an offer but more, how do they add genuine value to their lives? Why is it potentially going to be a product they can’t live without? Tapping into the primal needs of the user in these turbulent times is a way a retailer can craft their story and resonate honestly with their target audience.

3) Durability

As an extension to being essential, people will need to feel that the item that they are buying from your store is built to last for more than the lifespan of your average reality star.

Rather than offering a lifestyle associated with a brand, as retailers, you can focus on the quality of the products you are selling them. This should be the starting place for a conversation about a brand and how it will last for someone whose budget is going to be squeezed for some time. The hardiness of your product, particularly for those more expensive items you may range, is crucial. No one likes being mis-sold an item but people are far less willing to tolerate buyer’s remorse in a recession. Dob this at your peril, as it’s likely that you’ll never see that customer again

Consumers are also now genuinely asking, why do I have to pay more for quality? Surely, even if I’m buying at the entry-level of the range, it should still be a quality product. The craftsmanship of its build and robustness need to be communicated to the customer clearly and honestly by your staff to all without bias. 

Indeed we are now in a new reality where brands have to accept quality and durability is delivered at a more affordable price point. Certainly, if they want to maintain market share. Losing market share in a downturn can be very difficult to recover from when times return to being good. Long-term thinking needs to trump short-termism. This changes the way in which you sell to your customers of all demographics.

4) Sustainability

The longer something lasts, of course, the more sustainable it is. Sustainability is a huge driver for younger generations. In our research sustainability came through as a top driver of behaviour for 23% across all age groups and rising significantly to 38% for Gen Z. 

Far from moving away from this priority at a cash-strapped time, consumers are in fact doubling down. Indeed new research from SAP reveals that despite the cost of living, over half (52%) of UK consumers aged 18-34 are actively looking to shop more from retailers with strong sustainability credentials this Christmas.

They want to understand that a product is not destroying the planet. This is not greenwashing but also understanding this generation will do their research about the full life cycle of a product. The good news is the extent to which communication forms part of the sales process enables these factors to be included in the discussion. If something can save money by assisting less energy use or being more durable, it is therefore more sustainable and solves many current consumer concerns.

5) Innovation

Finally, innovation is the other key driver of consumer purchasing behaviour in the current climate. Indeed innovation plus value has also been a winning facet of the trend for air fryers. Indeed according to research by price comparison website PriceRunner, demand has soared by 3,000 per cent since 2021. This an opportunity to be understood and embraced to appeal to your consumers this gifting season.

However, critically the air fryer answers several other current consumer needs states. We, post-covid are eating at home more and it is a way of getting your family and your friends and getting your kids involved. It is also healthier. This addresses the growing trend for healthier versions of popular meals.

Most crucial to the surging trend though is the value proposition. The money that can be saved through cooking at a time of rising energy costs is significant and of course energy efficient. This is why we can be sure that this may be one of the most popular Christmas gifts this year as already on Black Friday it became a sell-out line in numerous brick-and-mortar stores and online with Curry’s stating they sold more than 18,000 during the week of Black Friday.

In summary, retailers do need to recognise changed behaviour and a new paradigm on the back of a series of interconnected trends and crises. These centre on changed lifestyles that are more based in the home, a growing movement for sustainability and most crucially the need to save money.

Consumers simply won’t invest in the way they did before, meaning retailers need a laser-like focus on their customers’ new needs. The narrative a retailer needs to highlight is value for money, why it’s essential, the product’s durability, sustainability and its innovation.

To remain relevant as we face an economically challenging climate is tough.  For some, this will require a radical step change. For others, it’s underway and the new normal.

To read the full article by Dan Todaro, Managing Director please visit ERT Online

Photo by Carl Raw on Unsplash

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Adapt And Thrive: How Retailers Can Succeed in 2023

The cost of living crisis era has shaped much of this year and looks set to be a trending topic well into next year. While we would all like to see the worst of it behind us, the latest OBR forecasts show that economic recovery is still some time away, with their data predicting a 7% decrease in household incomes in the coming two years. Read on to see how retailers can succeed in 2023.

A recent survey conducted of 2,165 respondents by the Gekko group and carried out by YouGov highlighted just how much spend has already been restricted in certain categories. It identified that 66% of those surveyed said that they are cutting down on non-essential items. 43% were decreasing spend on their essential household goods.

While these headlines confirm the severity of the situation the country finds itself in, within the retail sector the way consumer behaviour has changed as a result still presents opportunities for brands and retailers to succeed.

Gen Z Least Likely to Cut Spending

Interestingly 52% of 18-24-year-olds in our survey said they were decreasing their spend on non-essential purchases, the lowest of all age groups. Gen Z are brand focused and remain loyal to those that match their values in ethics and sustainability. Employed and with new money in the bank, this tech-enabled generation is just as willing to engage with brands both in-store and online.

At the other end of the spectrum, as we get to the older categories, there are further cutbacks with 75% of 35-44 saying that had reduced non-essential purchases. Of course, these older generations are likely to have more disposable income with which to keep up their levels of spend. Often being homeowners, these customers are the most likely to be purchasing big ticket electronics items like appliances, and therefore are particularly discerning about the quality and durability of these products.

Regardless of your target group, it is important to remember that there are valuable inroads to sales across the generations. A customised approach is required to provide a meaningful connection, translating through the customer journey to purchases.

Recession-Proof Premium Market

Much focus has been on consumers trading down for their purchases, but data also shows that the premium market has also been relatively recession-proof for a number of reasons. Premium customers are more likely to have kept purchasing regardless, being less affected by cost of living growth. Meanwhile other groups are also likely to invest in high quality devices as they are built to last, crucial with the cost of living squeeze likely to last.

According to Counterpoint Research, there was a 95% YoY growth in smartphone sales over $1000 in Q2, highlighting the ongoing demand for the very best devices. With their ranges coming into focus across all demographics, Premium bands can capitalise on this interest by offering accessible routes to their products through pricing plans and brand marketing.

Trading up and down for items is one way that consumers are switching products or brands, but there are others to look out for. We found that 48% of respondents were willing to switch for non-essential purchases as a result of the impact of the cost of living crisis. Within the electronics sector, budget (69%) and durability (52%) were key motivators to switch, with sustainability (23%) the third most important driving factor. The sustainability topic is not one that is going to fade away and is a particularly important one for younger Gen Z customers, who will connect better with brands that show ethical credentials.

So how can retailers and brands continue to succeed in this turbulent period? The ongoing lessons learned from the events of the past two years remain relevant.

1. Remain Adaptable

Showing adaptability when it comes to your consumers’ needs is imperative. Be prepared to pivot your messaging based on their needs now will pay dividends. This will stand you in good stead to succeed when the economy and consumer confidence begins heading in the right direction.

2. Continue to Invest In Your Brand

Building loyalty now will pay off in the long run, and investment in your brand during challenging times will pay off later with others disappearing from view. Discerning customers are looking for the best products at the best deal, therefore brands need to reinforce just why they should choose them.

3. Demonstrate Your Brand Values

Shouting about the values of your brand is also vital. We have seen evidence that consumers across demographics will stay loyal to those that they feel an affinity with, so to do that they need to know who you are and what you stand for. This can be through marketing activities in-store, online or across all channels simultaneously.

A recent LinkedIn survey highlighted that 78% of respondents agreed brands that maintain or increase their marketing spend during economic troubles are the best placed to recover faster afterwards.

4. Show Empathy With Your Audience

Demonstrating empathy in your go to market strategy during this cost of living crisis will ensure you remain relevant with all consumers when competition for attention is at its fiercest.

A positive omni-channel customer journey will lead to better engagement and enjoyment for the consumer. After all, a bit of joy goes a long way in these challenging times.

To read the full article by Tom Harwood, Data and Insight Manager please visit Talk Retail
Photo by Michal Matlon on Unsplash

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Predictions 2023: Marketing

Predictions are never easy, and as we end 2022 mired in a heady mix of cost-of-living crises, rampant inflation and a war in Ukraine, who knows what will be on the cards for next year?

In our first look at business predictions for 2023, we’ve canvassed the leading lights of the marketing world to gauge what they see as the key priorities for the sector in the year ahead. 

Having emerged from the global pandemic in 2022, we should remember that we’re all survivors.

Perhaps it’s no surprise, then, that kindness, empathy and being authentic are coming to the fore as we prepare to head into a new year… 

Dan Todaro had this to say:

“Inevitably next year will be dominated by the need for brands to understand a campaign’s Return on Investment (ROI).

“With so much pressure on the bottom line, ROI will become the single most important driver for marketing in 2023.

“After all, the ability to demonstrate the value of every pound spent and the weighted impact of your marketing efforts, leads to the only barometer that matters, sales.

“And in a period where 60% of consumers are prepared to switch brands based on value, the customer journey must be re-understood to be curated effectively”.

To read the full article featuring Dan Todaro, Managing Director’s insight please visit MediaShotz
Photo by Mediashotz

How retailers can win customers in a more challenging climate

As we enter this critical quarter for retailers, they are faced with a series of new challenges dampening consumer confidence. The impact of inflation with consumers facing real term pay cuts, the impact of increased energy costs and now surging mortgage costs on the back of a disastrous mini-budget, which the effects are unlikely to be reversed as quickly as they were created. 

A headache-inducing cocktail of challenges in this critical time for boosting the bottom line. Yet retailers have shown remarkable resilience and adaptability over the past two years to continue to offer customer-centric strategies. They will need these qualities to continue to survive and thrive. 

So how to react? In a recent study we carried out in conjunction with YouGov, we wanted to look at the impact of this inflationary period on consumer behaviour. What are the drivers of purchasing in these challenging times and what is the impact on cross category purchasing? By understanding the motivations of different consumers at this time retailers can ensure they truly focus on their needs. Those that do will be rewarded.

Consumers cutting spending on essential items

The research highlighted that the cost of living crisis is being felt at the sharpest edge by those on the lowest incomes. Many are struggling to afford the basics as energy bills have rocketed, despite the support package now being provided.

For essential household items, more than 2 in 5 respondents revealed they had reduced their spending (43%). Of these, 1 in 3 (32%) have cut spending on essential household items by more than 15%. 3% have cut spending on essential items by more than 50%.

There are some significant variations, based on gender, location, age and financial situation. 48% of women have reduced spending on household items, vs 38% of men. Of those who have reduced their essential household spending, home owners (of any type) are the most affected, with 63% saying they had cut spending by up to 15%, compared to 51% of renters.

Londoners are least likely to cut spending significantly. Of those who have reduced their spend on household essentials, just 2% of Londoners are cutting spending by more than 50%. Meanwhile in the East of England this rises to 6%, and 7% in the North West.

This highlights the uneven nature of the situation and the need to not have a one size fits all strategy in communicating with audiences.

Spending plummets on big ticket items

For considered purchases, 52% of 18-24 year olds have cut back on spending, compared to 68% of 25-34 year olds and three quarters (75%) of 35-44 year olds. The categories hit hardest by a cut back in spending of consumers of these goods are: Consumer electronics and homeware and home furnishings with 61% of consumers of these goods reducing spending. Next was Clothing & apparel 60%, DIY and garden, 50% and Baby and child, 41%. As the cost of living increases and the ability to secure a new mortgage or afford the one you already have will impact further the decision factors around a considered purchase.

The factors driving purchases in today’s climate

Of those factors we know that are driving purchasing behaviour for more expensive items. In today’s environment the number one factor driving a considered purchase is that something is within budget, 69%, durability/ being fit for purpose was next, 52%. Third in the list was sustainability, still favoured by 23% of respondents. Brand awareness was considered by just 13% of respondents. For Gen Z (18-24 year olds), the result for sustainability was far higher at 38%.

Millions of consumers looking to switch brands

Another key takeout is that brand loyalty has plummeted in the current climate. 60% of people would switch brands for essential items and 48% of people revealed they are more likely to switch non-essential considered purchase brands.

This suggests the need for a tailored approach for brands to remain relevant in the current environment. Ephemeral qualities like brand values seem less important when people are rightly concerned about affording bills.

Quality and price consideration crucial

The focus in generating sales and retaining customer interest should be price and durability as the two key factors driving buying decisions. People still need big ticket items but necessity trumps desire in the current environment.

However, it is important for brands to have expertly crafted messages for different audiences.  with sustainability still crucial, in particular for younger audiences. Having the right tone and audience-centric approach will help brands and retailers remain relevant and necessary during the next few months.The results reveal the cost of living crisis has had a dramatic impact on consumer spending at all levels. It highlights that there is a real need to focus on value and  longevity to win customer loyalty with the need to craft audience-specific messages like never before. If retailers and brands keep this in mind, without the need to apply offers, they can still thrive amongst the turbulence and uncertainty. 

To read the full article by Dan Todaro, Managing Director please visit Retail Sector

Photo by Rachel Hannah Photo on Unsplash

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The New Normal

Following a two year hiatus, IFA is back and re-energising the tech world’s attention. From smartphones and smart homes to TV, audio and domestic appliances, the show was packed with the newest and exciting products from some of our favourite brands including LG, Samsung, Toshiba, Miele and countless more.

IFA is one of the globe’s largest technology events, with a confirmed 1,100 exhibitors and 161,000 visitors this year. The show attracted a strong media presence; more than 2,500 journalists came to Berlin and around half of them were representing international media organisations. So far, media monitoring has identified coverage of IFA 2022 by publications and broadcasters in over 100 countries around the world.

This makes IFA a vital industry showcase for trade and consumers to see leading brands present their latest products and innovation to not only the press but also to retail buyers as well as the general public. Plus it provides observers on a world stage, through social media and chat, a window to the latest technology trends, discovering where brands are developing their product portfolios. Furthermore, it’s a barometer for retailers to see what’s coming, helping them prepare for range planning and the knowledge share required to sell these new products effectively in the coming seasons.

Having not had a full event since 2019, during this period it seems that many brands have been taking influence from how we now live our post pandemic lives. Therefore, following lockdowns and the ghosts of COVID, they are recognizing that we value our homes more than ever as places to thrive and grow, not merely live. Consideration is also being given to our lifestyle choices and the generational importance in sustainability as a concern in the technology we use day to day to enhance our lifestyles. This is being recognised more I suspect, to generational demands and less because brands wanted to. Nonetheless, it’s a positive step forward and one the technology industry can lead in and set examples for others.

Therefore the overriding message, which every brand was shouting about loudly, was sustainability both in terms of materials and product usage. I noted that less was being said about the ethics of manufacturing and how products are made. Perhaps this is a step too far to address across all category lifecycles. But even so, sustainability and design had become significant buzz words at IFA 2022.

The sustainability message carried into some of the stand designs, with Panasonic and the hall they occupied being very low cost, with a focus on reduced waste. This meant no floor covering and attention was focussed on the products rather than their IFA setting. Also of note, was the fact that some brands didn’t bother attending this year. Sony being one such brand whose only presence was a meeting booth.

Changing Consumer Styles

As indicated, brands have also been busy in their understanding that our homes have become increasingly more important as a style statement that reflects our changing lifestyles. This meant a host of new style focussed products and technology being brought to market and proudly showcased to the world at IFA2022.

One such brand to do this rather spectacularly was LG who brought us the new MoodUp fridge which is not only filled with advanced refrigeration features but also has personalisation at its core. Owners are able to change the colour of their fridge depending on their mood and light up their kitchen to reflect the desired ambiance. Furthermore, it incorporates speakers to play music thus providing an additional sonic experience.  With the ThinQ LG app on your mobile devices, you will be able to adjust the lighting from 22 colours on the upper panels and 29 colours on the lower panels. For those that don’t need this choice of combinations there are also 4 preset colour schemes. These presets also have the benefit of enabling the app to stream music playlists that compliments the selected colourway as well as syncing the light effects with the music so that the colours change with the music.

Sticking with home appliances, it appears that it’s no longer unusual to desire a range of products that are fully interactive. Some offer interactive panels, where, for example, you can pull-up recipes to assist with your cooking, Facetime a friend or simply use your appliance as a digital photo frame to display your snaps in an endless loop. Samsung presented such a solution with a bespoke range on MDA’s, which not only look fantastic but are also super efficient in their energy consumption and water usage.

The competition is also ahead of the curve. Again, LG have their own unique technology as demonstrated on their Instaview capable fridges, while Panasonic had its combination ovens which seem old fashioned but have been revitalised with new features in its SDA range alongside its bread makers and juicers. A clever move, reflecting the trend towards making things in the home to assist in budgeting and sustainability, as well as reducing the need for packaging and transport. These categories are seeing growth and Panasonic is very much ahead of the curve leading the charge here for premium brands.

It certainly appears that some lockdown habits are persisting, together with health and the increased cost of living being a driver for certain categories. I would suspect that breadmaking and juicing will continue to gain popularity across all generations. In fact Panasonic announced that their mission across all well-being categories, inner, outer and spatial well-being, is to deliver on their vision of holistic well-being.

Commercial Appeal

Another trend evident from many brands including Samsung, LG, Panasonic and TCL was developments in heating and cooling products. Aircon may not be a particularly glamorous category but in adding air purification technology and applying a variety of unpronounceable, ethereal names such as NanoeX or Breaver, manufacturers are trying to garner attention in this category but i feel these unpronounceable names are merely branding for branding sake, maybe detracting for the core of the product and its health benefits.

From branding to innovation and as mentioned, there’s no doubt that sustainability is the name of the game at IFA alongside intelligent connectivity of devices and Smart Home solutions and there was certainly lots to impress. Sometimes, however, I’m left with the impression that innovation can also be created only for the sake of it with no real commercial or mass appeal but merely to grab headlines. The LG Styler ShoeCase has to be for me the most random exercise in innovation from an established global brand. This thing is in essence, a box in which to display and sanitise your footwear, removing the odour of stinky feet. These cases are transparent on three sides, with customisable lights and a 360-degree turntable which refreshes shoes in 40 minutes with LG’s TrueSteam technology to reduce odours, viruses and bacteria. This is all very clever but the ThinQ app lets you go that one step further, in that you can upload the details of your most precious kicks to share on social media and brag about.. Mindblown? Mine is.

Taking this concept one step further still, you could place this box of wonders on the LG Aero Furniture table. Made from recycled materials, the LG Furniture range crosses home furnishings with technology. What is basically a lamp with mood lighting, buyers of the Aero table can choose a base and top to match their decor.

This approach was a trend across the board from Samsung with its ‘Bespoke’ range of home appliances which again enabled personalization of your appliances to match your living space and tastes. Taking the technology Samsung is known for and turning it into a statement piece many would like in their home. This naturally extended into some more traditional technology you expect to see at IFA such as the new Laser, 4K Triple and NEO QLED 8k televisions.

Toshiba also had some interesting tricks up their sleeve such as the new Toshiba Tik Tok TV to appeal to the generational shift familiar with the platform, bringing it to the biggest screen in your home with quantum dot 5k, Dolby Atmos and Onkyo speakers.

I suppose what we are seeing here from brands like LG and Toshiba is a way to tap into all generations and remain relevant whether that be through traditional technology as we know it and the new world, where technology intersects art and design to enhance and in some cases, create lifestyles. All done within the remit of sustainability and convenience for an ever changing and evolving population that now lives differently to how we did only two years ago. The paradigm was well and truly turned on, metaphorically and in reality.

In essence, I suppose the absence of this behamouth hosted in Berlin, has made us all grow fonder towards IFA, reminding us of  its importance in the industry, garnering more than 1.6 million impressions on all social media. This makes IFA the ideal platform for brands to showcase, with pride, their innovation which retailers will be ranging in the coming months. With the economy as it is, and home ownership becoming increasingly more prohibitive due to interest rates, some may revert once again to improving the space they currently live in. That’s where you fit in. Make the most of the opportunity and give your customers honest advice and sustainable solutions from the best technology that matches their needs.

To read the full article by Dan Todaro, Managing Director please visit ERT Online

The re-considered purchase: Consumer behaviour in the inflation era

The cost of living crisis has had a dramatic impact on consumer spending with brands needing to focus on value and the longevity of their products to win customer loyalty. These were some of the key findings from a new research report by marketing agency Gekko.

The survey of 2,165 respondents carried out by YouGov in August commissioned by Gekko, revealed that two thirds, 66% have cut back spending on ‘personal non-essential considered purchases’. These are defined as non-essential purchases that have a degree of financial or emotional investment.

Meanwhile more than 4 in 10 (43%) of people have cut back on spending on ‘essential household items’ due to the increased cost of living.

The re-considered purchase

For personal non-essential considered purchases, 52% of 18-24 year olds have cut back on spending, compared to 68% of 25-34 year olds and three quarters (75%) of 35-44 year olds. The categories hit hardest by a cut back in spending of consumers of these goods are: Consumer electronics and homeware and home furnishings with 61% of consumers of these goods reducing spending. Clothing & apparel 60%, DIY and garden, 50%. Baby and child, 41%.

In today’s environment the number one factor making people consider a purchase in the consumer technology space is that something is within budget, 69%, durability/ being fit for purpose was next, 52%. Third in the list was sustainability, still favoured by 23% of respondents. Brand awareness was favoured by just 13% of respondents. For Gen Z (18-24 year olds), the result for sustainability was far higher at 38%, suggesting the need for a tailored approach for brands to remain relevant in the current environment.

Brits slash spending on essential items

For essential household items, more than 2 in 5 respondents revealed they had reduced their spending (43%). Of these, 1 in 3 (32%) have slashed spending on essential household items by more than 15%. 3% have cut spending on essential items by more than 50%. There are some significant variations, based on gender, location, age and financial situation. 48% of women have reduced spending on household items, vs 38% of men. Of those who have reduced their essential household spending, home owners (of any type) are the most affected, with 63% saying they had cut spending by up to 15%, compared to 51% of renters.

Londoners are least likely to cut spending significantly. Of those who have reduced their spend on household essentials, just 2% of Londoners are cutting spending by more than 50%. Meanwhile in the East of England this rises to 6%, and 7% in the North West.

Millions of Brits looking to switch brands

Brand loyalty has plummeted in the current climate. 60% of people would switch brands for essential items and 48% of people revealed they are more likely to switch non-essential considered purchase brands. Men are less likely to consider switching their considered purchase brand choices, 43% versus 52% of women.

Commenting on the findings Daniel Todaro, Managing Director of Gekko said: “The results highlight the dramatic but also the uneven impact of this cost of living crisis. There is certainly no generic strategy for brands wanting to remain relevant in the current economic climate. These huge variations in choice are clearly based on income level, age, gender and location. No longer is desire beating need when making choices.”

He continued: “While large numbers of people are being seen to be cutting spending on considered purchases, it is now implied that brands should focus on price and durability as the two key factors driving buying decisions. Ephemeral qualities like brand values seem less important in today’s climate. However it is important for brands to have expertly crafted messages for different audiences with sustainability still crucial, in particular for younger audiences. Having the right tone and audience-centric approach may assist brands in weathering the turbulent times predicted ahead.”

To read the full research click here

Businesses that have a passion for training and staff development will excel during challenging times – how can independent retailers make the most of the opportunities available?

With the average turnover of staff or attrition rate, at 63% in retail compared to the national average of 15% across all employers, isn’t it time that retailers take stock of this a little bit more? Considering how much it is estimated to cost retailers – a recent report cited that globally retailers lose $19 billion each year on new staff costs –  it’s a false economy not to treat your staff as a highly valuable asset. Instead, much of what is spent on recruitment could be channelled into refreshing stores and training staff to enable them to be effective in their roles and provide an exceptional customer journey for shoppers.

The focus should be on retention rather than recruitment and with over 32% of retail staff stating that they receive no formal training at all, it’s a critical part of the puzzle that creates the whole picture for your customer experience.

Brands know this and that’s why they invest millions each year to train third party retail partners. New starter or induction training isn’t where staff training should begin and end. An ongoing plan for individual staff members is essential, with regular reviews and new initiatives implemented. Also consider all the brands that come in and train your staff week in, week out and then compare that to the training you deliver to your staff. How does your internal training stack up in comparison and ask whether your own training benefits your employees and enables them to be the best that they can be and are motivated whilst doing it?

It’s recorded that one in three staff leave their jobs due to a lack of training that allows them to learn new skills and develop their skill set. This shouldn’t be the case, as shoppers expect to be engaged by sales staff who know how to handle the sale of a considered purchase. The sales associate has to understand the importance of the sales process and how to navigate this to meet the customer’s needs and enhance their experience. Without training, who’s to blame when the sale doesn’t get closed or the customer walks out and later orders online? Often I think it’s the retailer for failing to develop the associate’s skill set to identify the need, create a journey that responds to the need and close the sale through an enhanced customer experience which builds on your customer service proposition.

Now more than ever, enhancing the customer experience is critical to create theatre in order to take the consumer through the varied steps of the journey from demo to sale. To do this, the responsibility as the employer is to equip your staff to be the best they can be – and this all starts with training. A key element of success in store, especially for considered purchases,  is the engagement of shoppers with any retail sales advisor [RSA]. Therefore as the employer, are your RSA’s proactive, helpful, skilful, knowledgeable, and capable of providing a personalised experience? This is something the online experience can’t replicate and physical retailers should be capitalising upon and drawing people in-store with the promise of a worthwhile face to face engagement.

The difference is down to individuals, their training and management, all of which are critical when it comes to talking about a brand and its products. It is vital that RSA’s are informed and motivated to deliver an exemplary customer experience through being not only advocates of the brands ranged but also of the store itself.

So what can be implemented at very little expense, apart from time, in order to give staff the opportunity to grow with a view to be successful in their roles and motivated to remain as an employee of your store. Here are five suggestions that you can influence:

  1. Ask your suppliers for training support or choose to work with brands that offer recognised training e.g. those who’ve been shortlisted for an ERT training award. Look around your store and identify every brand or category that your staff can’t sell effectively. These are the brands you can lean on for training support.
  2. Seek out and invest in training specialists to support your business and develop your staff to be effective in their roles. But first, you need to understand what things are like from the shoppers’ point of view. What is their experience like when they come into your stores and engage with your sales people? Consider commissioning a mystery shopper survey to provide an independent assessment that can be benchmarked against other retailers and indeed your competitors. This will provide you with insight on what behaviours need to be changed and skills improved so that the training can be tailored accordingly.
  3. Membership of organisations such as BIRA (British Independent Retailers Association) can offer specialist retail training and bespoke learning – https://bira.co.uk/benefits/retail-training as can seeking out support from your buying groups or trade bodies such as CIH, Retra, Sirius or Cedia to name but a few.
  4. Check with your local authorities to see if they offer free specialist training and support to you as an independent retailer in the community. An example – https://www.midsussex.gov.uk/licensing-business/independent-retailers-support-programme-2021-2022/
  5. Build and develop a Sales Advisor training program for your store(s) that recognises personal development and rewards individuals for their efforts. This does not necessarily need to be monetary, it could be in the form of certificates and or treats.

To read the full article by Dan Todaro, Managing Director please visit ERT Online

5 Retail Trends Impacting Customer Behaviour

We live in extraordinary times. While conventional wisdom pointed to a significant economic recovery after the challenges of the pandemic, a different picture has emerged as we look to the Autumn. The cost of living crisis is impacting everyone and has dramatically impacted the willingness of consumers to engage in discretionary spending.

Recent events have proved that markets can shift in an instant, and reacting to these effectively can be the difference between keeping or losing customer loyalty. It means working harder than ever to understand the trends that are impacting behavior. But after the horrors of lockdown, retailers with the right smart strategies can emerge from this bumpy road back to a more normal trading environment.

It is key to utilise opportunities across store and ecommerce to ensure your offering is ahead of the game as we look forward to the golden quarter. So what are we seeing that is worth consideration? I think there are five key trends impacting behaviour in the second half of the year.

1. The Inflation Era Shows No Sign Of Abating

We are living in an era with the highest level of inflation since the 1970s. This has been driven by pent-up consumer demand after the pandemic and the Russian invasion of Ukraine. According to the most recent BRC-NielsenIQ Shop Price Index data, shop prices hit their highest point of inflation since 2008 as the balancing act between supply chain costs and a cost conscious consumer continues. For July, Shop price inflation soared by 4.4%, up from 3.1% in June,

Consumer concerns regarding the cost of living cannot go ignored by retailers and brands. Intelligent pricing strategies are a  key priority, as well as ensuring your customer journey is quality enough to capture a consumer willing to shop around.

2. Customers Being More Canny With Considered Purchases

In this inflationary world consumers are needing to think very hard about big ticket items. Particularly when looking ahead to further energy price rises in the Autumn. This is having a noticeable impact on existing sales. There was a 4% MoM decline in global smartphone shipments according to the latest Counterpoint research market review. This represents the second consecutive month of MoM decline, along with being the 11th consecutive result showing YoY sales decline.

Despite many ongoing success stories, the overall market has yet to reach pre-pandemic levels. While component shortages have been partially sorted; inflation, a slowdown in China, and the war in Ukraine have all affected recent demand.

With smartphone upgrades being a discretionary purchase it is incumbent that retailers focus on the value of any big ticket items. For appliance manufacturers emphasising the ability to help save energy and costs can be key. With running costs becoming of more interest, consumers will be looking at eco-credentials for new appliances, as well as potentially opting for better quality units that will stand the test of time.                                                     

3. Personalisation and Experience Key to Driving Return Visits

There is also an expectation of quality customer service and personalisation. Something that will please consumers and drive up the chances of a return visit, whether that is online or physical store. Research commissioned by Gekko last year found that the top factors driving sales were experience related. This includes the ‘ability to see and touch a product’, and expert, tailored advice.

Empowering the consumer through increased personalisation is vital, particularly as 80% say they would only shop with a business that embraces it. It is the ability to differentiate in today’s environment that will mark out success from failure.

People now have an elevated expectation of their shopping experience, looking for curated, one-to-one engagements at various stages of their journey. Such interactions breed brand loyalty and recognition, meaning you can count on people coming back for more if they enjoy their time with you. Recent research by MoEngage found that only 25% of retailers currently personalise their communications with their customers, so there is a real opportunity to get ahead of the curve.

4. Embracing Omnichannel and New Tech

2022 has seen a return to steady growth for ecommerce in conjunction with the full return of bricks and mortar footfall. With both channels set to grow sales this year after the end of lockdowns, it becomes more important than ever to ensure your omnichannel presence is informative and engaging.

The proportion of retail sales online was 26.6% in May 2022 and remains substantially higher than the 19.7% in February 2020 before the coronavirus pandemic. Research we commissioned last year also showed 80% of consumers would now research online before buying an item instore. It is crucial to ensure you have a seamless and joined up journey across your various touchpoints.

5. Sustainability and Ethics

This continues to be a top consideration for consumers when it comes to choosing both how they shop and who with.

According to Deloitte’s latest Sustainable Consumer research, environmental awareness amongst UK consumers has rocketed in the past year with 85% now making more sustainable lifestyle choices. The findings revealed a strong desire to adopt more circular practices, such as buying products in sustainable packaging.

Credentials need to be backed up and also authentic, an increasingly savvy market will disengage otherwise.

So the road ahead may be bumpy but with the right map retailers and brands can navigate through the difficulties. Understanding the consumers’ specific needs is key to ensure retailers can be back in the driving seat for the second half of the year.

To read the full article by Rupert Cook – Marketing Director Gekko Group, please visit Talk Retail

Photo by Gary Butterfield on Unsplash

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