Maintaining advertising spend helps stop consumers trading down

By Katie Bird

- Last updated on GMT

Related tags Recession

Companies should maintain their advertising spend even when times are tough to try to stop consumers from trading down, according to research company comScore ARS.

The recent recession has seen consumers trading down in the personal care sector; a market which comScore ARS claims has historically been more resilient to this phenomenon.

According to the market research company, fewer consumers are buying the toothpaste, mouth rinse or shampoo brand they really want, compared to two years ago.

In March 2008, 67 percent of consumers said they were purchasing the toothpaste they wanted, compared to 57 percent in March 2010. The drop is even higher for mouth rinse where 61 percent of consumers were purchasing what they wanted in 2008 compared to 44 percent this year.

Shampoo came out with similar results; dropping from 65 percent to 52 percent.

Within the category, trading down appears to be motivated by both a move to cheaper brands as well as the one-off purchase of reduced, sale items.

Fear of failure

“The category has often been thought to be more immune to trading down, as the confidence level and fear of failure associated with products in the health and beauty category is higher,”​ Wendy Preiser, vice president of the ARS Group (specialists in researching the efficacy of advertising campaigns recently acquired by comScore) told CosmeticsDesign.com USA.

However, the company maintains that there are things brands can do to try to stop consumers from trading down.

“Research has repeatedly shown that premium brands which invest in marketing and promotion activities aimed at maintaining buying at ‘preferred’ levels are able to minimize short term erosion of share to less expensive brands and position themselves for a bounce-back when the economic improves,”​ said Gian Fulgoni, comScore’s chairman.

However, there is a tendency for companies to cut spending on advertising during an economic downturn, explained Preiser.

“’Sales are down so lets cut on advertising’ is what a lot of companies think in an attempt to protect their bottom line,”​ she said, before adding that experiences in past recessions suggest that this may not be best strategy.

Related topics Market Trends

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