Multimedia

Busting Pricing Myths video series: Has Covid driven consumers to make more price comparisons?

Multimedia

Busting Pricing Myths video series: Has Covid driven consumers to make more price comparisons?


As we continue to bust the myths about price and promotion, we took a look at how consumer behaviour has changed after the covid period. There is economic “polarization” of shoppers in the new normal: 73% are cost-conscious consumers altering their buying and consumption patterns. Did it push them to make more price comparisons than ever before? Find the answer in our video series “Busting pricing and promotion myths”.


While quite a large number of consumers are looking for lower prices and are relying heavily on promotions as well as private label products, this does not necessarily mean that manufacturers should start focusing purely on lower-priced products in their portfolio. There is clear evidence of strong consumer loyalty among brands, particularly for shoppers who are not planning on changing their habits.

For example, half of the MEA and European shoppers stick to their brand preferences. At the same time half of the consumers in Europe claim that if they are choosing a lower priced product, they would only choose within their preferred repertoire/selection of products. The number for the MEA region is a little bit higher – 61%. The key for brands is to identify and refine their shopper segmentation, as changes in consumer habits continue to evolve.

What is happening with own and cross elasticities? Regular price elasticity consists of two components: own elasticity is used if all products change price together, and cross elasticity is used if the competition is changing price and you are not.

Person maximizing their revenue

Do not let pricing myths bias your business decisions.

Contact NielsenIQ and master all the new strategic rules of the pricing game.

The second myth suggests that due to economic hardship, these cross elasticities would increase a lot, as shoppers compare prices more. The fact is that cross elasticities around the world remained very similar, bringing us to the conclusion that consumers are still primarily driven by the price of products.

Thus, we have busted the second myth as well.