How to talk to customers in a cost of living crisis
Households are facing the biggest squeeze on their finances in 40 years, so what do they want to hear from brands and what will turn them away?
Rising food, fuel and energy costs, stagnant salaries and consumer cutbacks.
With inflation heading for a 40-year high, the Bank of England’s chief economist warns the ongoing cost of living crisis represents a bigger challenge than the financial crash of 2008.
While both economic shocks have been global – and very real – the current crisis feels somehow more personal, attacking almost every aspect of our daily lives.
Nine in 10 people told research group Kantar they’re worried about the rising cost of the weekly shop. Research by Which? shows this year has already seen price rises of more than 20% on some items.
Ofgem warned MPs average annual household bills could rise to £2,800 by October 2022. In April 2021, the average cheapest deals were just over £900.
These are more than just passing headlines. They’re serious financial challenges for tens of millions of consumers. The day-to-day reality is that people will be making more choices. Choosing when to spend. But more often, choosing when not to spend.
Tough times don’t mean brands can’t communicate. But audiences aren’t in the mood to hear the wrong message at the wrong time.
Tough times don’t mean brands can’t communicate. But audiences aren’t in the mood to hear the wrong message at the wrong time.
So how to get it right?
It all starts with listening. Being human. Knowing what your customers are going through, what we’re all going through together, and the part your brand plays – or could play – in their lives.
Are there realistic ways you can help your audience deal with their challenges? Can your brand show it truly understands the everyday financial decisions people face? If you can be genuinely supportive, now’s the time to do it. But beware of tokenism, and being unable to follow through a message. It can do more harm than good.
We know what hasn’t worked. Don’t send your customers socks or tell them to cuddle their pets to keep warm and cut their heating bills. They’ve been tried and, no matter how well-meaning, they didn’t go well.
Consumers know prices are rising, they see it every day. So be transparent and communicate quickly.
Honesty is at the heart of this. Consumers know prices are rising, they see it every day. So be transparent and communicate quickly – acknowledge what’s happening, explain the situation simply and clearly.
The next focus is the value you can bring. The difference you can tangibly make.
Value could mean price. Discounts at key calendar dates, loyalty bonuses, things that reward the customer relationship.
But value can also mean the values of your brand and the non-monetary value you can add to people’s lives. That value needs to be honed for the right audience – customers aren’t a generic group.
Use data and insight to find out what’s really happening to them, so you can send them the right message at the right time. If you’re a food retailer proudly committed to sustainable agriculture, people who share the same values will come to your brand if they’re making more careful choices about how often they spend.
You could be a financial brand offering targeted help and assistance on budgeting, or links to wider support for those finding it hard to manage their family finances. Or maybe you’re a hospitality business opening up their space for community groups and events, allowing people to focus on their wellbeing without having to spend money on hiring a venue.
Find out what your audience thinks. Think about how that feels, and what they need.
When people need more of a reason to splash out, make sure you’ve given them something to hold onto – a connection. Connect to customers in a meaningful way when times are tough, and chances are they’ll reward your loyalty with theirs.
