That Wednesday, the traffic on Osborne road was heavy. The weather was hot and all I wanted was a drink. I called the attention of a traffic vendor and brought out my N100 note for a bottle of Coke. I was met with a blank stare: “The price is N150 madam.” I was surprised but the thirst for a drink trumped my need to question the price. I was later “schooled” by the man seating beside me on the increase in the price of things and the reason why – “recession”.
The National Bureau of Economic Research (NBER) defines a recession as “a significant decline in economic activity spread across the economy. It typically lasts more than a few months and is normally visible in real gross domestic product (GDP), real income, employment, industrial production and wholesale-retail sales”. Nigeria’s descent into economic recession began mid-2015. Prof Ekpo, Director General of West African Institute for Financial and Economic Management, revealed that there had been a decline in the contribution to the nation’s GDP by the industrial sector from 24.20% in the 3rd quarter of 2014 to 23.5% in the same period in 2015. Prof. Ekpo further stated that it was “an unhealthy situation given the importance of manufacturing in driving growth and development, as well as job creation.” After negative growth in the first two quarters of the year 2016, Nigeria’s economy slid into recession. The economic downturn presented new and difficult challenges for marketers and manufacturers of consumer goods. There was an urgent need to retain consumer loyalty.
One of the most important, but often neglected aspects of a recession, is the insecurity of consumers. As they feel the pinch, they begin to search for alternatives. Consumers become value-oriented, distributors become concerned about cash flow and employees worry about their jobs. The instinctive reaction of companies at times like these is to tighten their belts and cut marketing and communication expenditures. The drawback of this approach however, is that when companies cut their outreach, they also begin to cut the ties that bind consumers to their brands.
Coca-Cola and Creativity
Notable among the brands that made strategic and creative adjustments, in light of the economic recession is Coca-Cola. The Coca-Cola brand is known for its catchy adverts and most recently, Coke Studio which brings together musicians and artistes form various parts of Africa to perform together. Through the years, it has asserted itself as a brand that is not only trendy but also innovative. This has won it top ratings among millennials. Over the years, Coca-Cola has run successful campaigns that have continuously helped to place it as a consumer favourite in the country. One of such campaigns is the 2013 to 2015 “Share a Coke” campaign. Coca-Cola, true to its reputation as a trendsetter, began printing names on PET bottles of Coke. Consumers woke up to the beautiful surprise of being able to find a Coke bottle with their names splashed across it. This move gave consumers a sense of belonging. Consumers were also given the option of going on the company’s website and designing a Coke bottle with their names printed. The campaign proved to be a great success.
Faced with the challenge of remaining afloat and making products affordable for the consumers, in spite of the economic recession, Coca-Cola launched the 35 cl Coke PET bottle popularly referred to as Coke Solo. Experts project that the new packaging is likely to raise NBC Coca-Cola’s turnover and profit next year. Analysts also predict higher direct and indirect employment for Nigerians who will be involved in the sale of the new ‘Mobile Coke’. The product is sold at N100 per bottle. This not only provides an alternative for the consumer who refuses to purchase the 60 cl bottle at N150 but also cements the loyalty of existing consumers to Coca-Cola. The brand has found creative ways to retain consumer loyalty and also improve sales.
Brands have a lot to learn from this move. Here are two lessons to note:
- Keeping your existing customers happy is hard work, but it’s worth it. The people who have often organically reacted to your products, your brand, and your content are the perfect audience for your continued efforts. If brands spend time on retaining the customers they already have, then they’d see the benefits of a loyal customer base.
- It’s not enough to understand market research and strategy. Brands need to know how to bring strategy to life, in ways that inspire and excite the public.
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—Keeping your existing customers happy is hard work, but it’s worth it. Click To Tweet Brands need to know how to bring strategy to life, in ways that inspire and excite the public. Click To Tweet