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How can retailers redefine value beyond pricing during a recession?

Black background with the text: you didnt come this far to only come this far

My first experience with discounting to drive sales and really struggling for that tactic to work was just prior to the 2007-2008 recession. We didn’t really know it was a recession – well the Board didn’t want to acknowledge it – but nothing was working to shift the needle. I was with the market leading electronic appliance retailer and there was more to it than this – but it was my first “holy shit moment.” How do we shift the needle when we need to keep labour tight (less salespeople), a reduction in marketing spend (top line drives the budget), supplier pull back in coop and we were already leveraging our loyalty programme as best we could (Fly Buys). 


As retailers we had always relied on discounting to drive sales and encourage money-conscious shoppers to browse and make purchases in-store and online. It’s been a formula – one we have not necessarily been proud of because you screw margin – but a tool none the less because you need to turn stock and drive cashflow. It can be a highly effective tactic for shifting stock, but it can risk altering how a retailer is perceived by shoppers if it is used without careful consideration, potentially damaging the retailer’s reputation, and hitting the bottom line. 

The current economic landscape is undeniably turbulent from declining trade figures and inflationary pressures to the rapid rise of ultra-discounters (Shein and Temu) and the prevalence of heavily discounted sales. Amidst this turmoil, a fundamental question arises: How can retailers not only weather these storms but potentially harness them as catalysts for success?  

The answer lies in a reexamination of what constitutes true value for consumers beyond the narrow confines of pricing alone.  

Girl sitting in supermarket trolley in a supermarket aisle

Redefining Value: Embracing a Holistic Perspective 

Easier said than done but you are in this for the long haul. Aren’t you? In times of economic uncertainty, consumers become increasingly discerning and meticulous in evaluating their purchases to extract maximum value from every dollar spent. While pricing remains pivotal, it is merely one thread in the tapestry of value perception. It is short-sighted not to consider a holistic perspective, one that harmonises the various elements into a cohesive and compelling value proposition. 

What does this mean? Value needs to encompass not only the tangible aspects of products and services but also the intangible experiences and emotional connections forged with consumers.  

A real-life example……I need to buy a new laptop for one of the kids. Money is tight and it is going to be the best part of $1500. We want it to last (so a decent brand), a reasonable warranty, ideally on special, but if not what else? The options: 

PB Tech – cheaper prices but not much else – I dislike the environment as it feels too cheap and it is difficult to navigate. The dudes (and they can only be described as dudes) are knowledgeable – sometimes too much and I have had many instances when I feel like a nonce. They do have IFC, but I just don’t like the experience – note my visits have been Penrose, Manukau and Newmarket. It’s for tech dudes or people looking for cheap stuff.

PB Tech's home page on their website

Noel Leeming – some items on sale, so/so range of options, Airpoints/Fly Buys, we know they keep all items linked to our profile so easy to find info when I need to and warranty information (especially as I have a complicated surname) plus I can click and collect today. I find the service typically better at Noel Leeming but not on my last few visits. I don’t think the team has been well trained. 

Screenshot of laptops available on Noel Leeming's website

Harvey Norman – some items on sale, good range of options, they have a good interest free option and currently I can get a bonus gift card to use at their store – I do need to provide the blood cord of my first born to apply for finance but once that is done it’s easy. I don’t find their POS (Point of Sale) and CRM system as good as Noel Leeming for finding information and you cannot access it yourself (as I can at Noel Leeming). These guys are well trained, and I think if you ask the right questions they don’t try to “oversell” you a solution. Plus, a pleasant and modern environment. 

Laptops available online at Harvey Norman

JBHi-Fi – I know these guys are doing well in the retail landscape, but I simply cannot shop here. I feel anxious and overwhelmed. Everything from the website to the store shouts at me. They don’t have the depth of range (they might but my shopping self gets overwhelmed, and I back out). To me this is the Pak n Save of electronic and appliance retailers and it is a great solution if you are willing to trade off the environment and service. (I need calm, which is strange as I prefer a Chemist Warehouse but that’s because all the other chemists lack so much experience it’s like a morgue). It does have a good Interest free offer. 

Home page of JB Hi-fi website

The most important things for me as a customer beyond price: 

  • Service – I need to get the right product as I do not know crap about computers – I know which brands I prefer based on their brand quality and performance attributes – but that’s it. I need someone to translate a solution to my needs as I do not want to do the research. I don’t want them to preach, roll their eyes or oversell me. 

  • Loyalty Programme - I will trade off Fly Buys/Airpoints for cash back. We are regular flyers, and we value this a lot. 

  • Range – I want to see depth and breadth, so I get to make a choice – not go with “well that’s the best of what you have” 

  • Interest Free – I am good at freeloading on someone else’s dime especially in tough times (we always pay off before we incur interest). 

  • Environment – I need to be somewhere professional and not hyper stimulating as we are already in a category that has lots going on. 

  • Information – I need to access my warranties, purchase history etc. without me having to keep everything. 

Harvey Norman will get our business this time - it provides the best overall value. [PS. Maybe not….my husband just emailed and said Noel Leeming has a better value machine, based on their King's Birthday deals that came out post me writing this and they have an IFC offer - so images no longer reflect what we are buying…...such as customer behaviour - and we will get the points! Ohh and I love their CRM system better too). 


Catering to the Value Shopper: 7 Strategies for Success 

To thrive in this value-centric environment, retailers must adapt their strategies to cater to the evolving needs and expectations of the value shopper. This discerning consumer segment is not solely driven by the lowest price but rather seeks an optimal balance between cost, quality, and utility. Winning their loyalty requires a multifaceted approach that encompasses the following key elements: 

1. Pricing Transparency and Fairness 

Retailers must ensure that pricing structures are coherent, with logical relationships between product sizes, variants, and quality tiers, fostering a sense of trust and credibility. 

Initiatives such as price matching, guarantees, and clearly communicated discount policies can reinforce perceptions of fairness and value, positioning the retailer as a trustworthy partner in the consumer's pursuit of optimal value. 

2. Strategic Promotions and Personalised Offers 

While price is a critical factor, promotions and personalised offers can ignite excitement and drive loyalty among value-conscious shoppers.  

Personalised offers hold immense potential, as they not only cater to individual needs but also foster a sense of exclusivity and appreciation. By curating personalised recommendations, retailers can streamline the shopping experience, guiding consumers towards products and offers that genuinely resonate with their values and aspirations. 

3. Private Label Optimisation 

Private label products have long been regarded as a bastion of value, offering consumers quality alternatives at accessible price points. During economic downturns, the appeal of private label offerings intensifies, as consumers seek to stretch their budgets without compromising on essential needs. 

Retailers must proactively optimise their private label strategies, ensuring a diverse range of quality tiers, competitive pricing, and consistent branding. By fostering trust and delivering on the promise of value, private label products can not only bolster consumer loyalty but also serve as a powerful differentiator in a crowded marketplace. 

4. Assortment Depth and Breadth 

The depth and breadth of a retailer's assortment plays a pivotal role in shaping consumer perceptions of value. A diverse and well-curated assortment not only caters to varied preferences and budgets but also instills a sense of choice and empowerment in the consumer's mind. 

By offering a range of entry-level, mid-tier, and premium options across various product categories (good-better-best), retailers can cater to diverse consumer segments while fostering an inclusive and accessible shopping experience. Additionally, thoughtful merchandising techniques, such as logical product flows and intuitive categorisation, can further enhance the perceived value of the assortment, guiding consumers towards their desired quality and price points with ease. 

5. Experiential Enhancements 

In the pursuit of value, consumers are increasingly seeking experiences that extend beyond the mere acquisition of products. Retailers must recognise the impact of in-store ambiance, customer service, and overall shopping experience on consumer perceptions of value (for example, many of the reasons I hate to shop at Pak n Save although intuitively I know it would be better for my budget). 

By cultivating welcoming and visually appealing environments, streamlining processes for seamless shopping journeys, and empowering staff with comprehensive product knowledge and empathy, retailers can elevate the shopping experience to new heights. Thoughtful touches, such as personalised recommendations, hassle-free returns, and tailored loyalty programs, can further reinforce the perception of value, fostering enduring connections with consumers. 

6. Embracing Omnichannel Integration 

In the digital age, consumer journeys transcend physical boundaries, seamlessly transitioning between online and offline touchpoints. “As well as, not instead of” is one of my most famous catchphrases. To remain competitive and deliver consistent value propositions, retailers must embrace omnichannel integration, ensuring a cohesive and frictionless experience across all channels.  

7. Sustainable and Ethical Practices 

In the modern retail landscape, consumers are increasingly attuned to the environmental and social impact of their purchases. Sustainability and ethical practices have emerged as powerful value drivers, resonating deeply with socially conscious consumers who seek to align their spending with their personal values and beliefs. 


In the face of economic turbulence and shifting consumer preferences, retailers must redefine their approach to value creation, moving beyond the narrow confines of pricing alone. By seamlessly weaving together factors such as quality, convenience, brand ethos, and customer service, retailers can create an immersive and memorable journey that transcends mere transactions, fostering a deeper sense of loyalty and advocacy among their customer base. 

Next week I will explore some more sophisticated strategies for those wanting to push further through optimisation of pricing strategies, leveraging customer and data insights, digital twins, loyalty and beyond the transaction in the Xfiles Unedited – my bi-weekly “unedited” exploration of conversations retail. Sign-up here 


Stuck to figure out how to shape value creation for your business? Perhaps consider one of our Strategic Business Reviews to identify where there are pockets of opportunity to grow your business and thrive. More information: or 0274768073 


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