Value Hackers
OUTSMART THE SYSTEM
Inflation instilled a new financial mindset, but consumers won’t skimp on what they really want.
Instead, they hunt for the best deals. And that extends beyond the price tag. Value Hackers find clever ways to maximise their budgets without sacrificing quality.
Businesses need to step up incentives, innovate around affordability and cater to cost-conscious needs.
Dupes and deals
Price hikes left consumers struggling to cover their expenses in 2023. Nearly 3 in 4 consumers expressed concern about the rising cost of everyday items. People were forced to make sharp cutbacks and trade down to cheaper options. They became Budgeteers out of necessity to keep up with the cost of living.
Even as inflation decelerates, the residual effects still impede their purchasing power. Saving money remains a priority, but shoppers will look for novel ways to stretch their wallets.
Value Hackers try to reduce spend without compromising quality. And they’re getting crafty to make this happen. These consumers actively look for dupes (or knockoffs), pay with credit card or rewards points, switch to premium private label brands and participate in free activities. Deinfluencers have also become popular on social media where people expose products they believe are overhyped or overpriced.
Consumers are adopting new financial or lifestyle tricks to make the most of their income.
of consumers were concerned about the rising cost of everyday items in 2023
Source: Euromonitor International Voice of the Consumer: Lifestyles Survey, fielded January/February 2023 (n=40,691)
of consumers planned to save more money in 2023
Source: Euromonitor International Voice of the Consumer: Lifestyles Survey, fielded January/February 2023 (n=40,691)
How Consumers Tried to Save Money
% of consumers who took these actions in the past 12 months
Cooked at home more instead of eating out
Cut back on non-essential spending
Decreased energy use at home
Switched to buying private label products
Bought products in smaller quantities or packaging
Repaired broken items instead of buying new products
Used an instalment-based payment plan
Joined online sharing groups and communities
Source: Euromonitor International Voice of the Consumer Survey, fielded January/February 2023 (n=17,757)
of professionals said that escalating promotional initiatives is a strategic priority for their company in the coming months
Source: Euromonitor International Voice of the Industry: Retail Survey, fielded June/July 2023 (n=287)
Benefits beyond price
Cost-effective and added-value solutions will help companies meet these consumer needs.
Explore affordable options outside of traditional markdowns. Bundle-and-save deals allow shoppers to purchase multiple products at a discount, for example. Subscribe-and-save plans take a similar approach with automatic replenishment. Private label lines can deliver comparable quality at a lower rate. Referral bonuses or early-bird rates also entice shoppers whilst putting cash back in their pockets.
Remember: price is one component. There are other factors to take into account. Loyalty programmes could let consumers earn points to put towards future purchases. All-in-one complimentary services like cleanings, repairs or warranties also serve as an added benefit. Find and offer extra perks that matter to your audience.
Communication is critical. If shoppers don’t understand your value proposition, they’ll switch to a competitor or find alternatives like dupes. Promote the right information that will influence their decisions. Education falls under this umbrella, too. Share tips and tricks on ways to save, or teach your customers about versatile ways to use your products.
Businesses need to offer additional incentives and balance cost with quality to attract Value Hackers.
Promotional and Discount Strategies
% of professionals who said their company is considering or exploring these initiatives
Build or enhance customer loyalty programme
Bundled discounts
Offer special discounts to first-time customers
Time-sensitive discounts
Offer promotions following an event
Buy one, get one free
Launch a retail referral programme
Early-bird discounts on new products or pre-orders
Source: Euromonitor International Voice of the Industry: Retail Survey, fielded June/July 2023 (n=171)
VALUE HACKERS Trend applications to consider
Lululemon
Athletic apparel retailer Lululemon held a pop-up experience in Los Angeles where shoppers could exchange their non-Lululemon dupe leggings for the brand’s Align leggings at no cost.
Turkish Airlines
Turkish Airlines offers passengers who are connecting through Istanbul—with layovers greater than 20 hours—free overnight accommodations, so travellers can explore the city.
Source: Turkish Airlines
Yindii
Yindii is a startup on a mission to combat food waste with operations in Thailand and Hong Kong. The app connects shoppers with local businesses like restaurants to purchase premium, surplus food at a discount.
VALUE HACKERS Three tactics for 2024
Offer affordable options like lower-priced models or product bundles at a discount.
Implement loyalty or rewards programmes with exclusive perks.
Demonstrate your value proposition and clearly communicate the benefits of your offer.
