Nicole Lonsdale of Kinetic: why trust is key to sustaining Christmas sales

Brands need to come clean to gain consumer trust during the cost-of-living crunch.

While most people across the UK are concerned about the cost-of-living crisis (68%) and many already making changes to their spending habits (59%), Kinetic’s latest Alfresco Life research paints a complex picture for both brands and consumers alike. While the outlook is undeniably challenging, Kinetic’s research suggests there still remains opportunities for brands – both now and throughout the winter.

As we look ahead to the (hopeful) return of a restriction-free winter, a large majority of people are looking to treat themselves (73%), socialise with friends and family out of home (67%) and ultimately go out and enjoy themselves (67%) following two and a half years of restrictions due to the pandemic.

According to the research, many consumers actually expect to either maintain or increase spending, with six in ten people revealing they are better off or the same financially as they were this time last year.
As a nation, we love socialising out of home. Our research found that the average person spends around £100 a month socialising, rising to £110 for city dwellers, with a third of the population planning to socialise even more in the future.

And, with Christmas festivities a mere few months away, 31% of people are already beginning to make plans, with half stating they will begin Christmas shopping early in order to spread out the costs.

What does this mean for brands and Out-of-Home planning?

As consumers continue to spend, brands should follow suit. With companies such as Unilever recently announcing price hikes, alongside a jump in marketing budgets to double down on loyalty, there’s clearly a belief that with the right strategy brands can still keep consumers on their side.

In fact WARC, research shows brands that increased media spend during times of economic uncertainty, boosted their investment by 17% in incremental sales. While brands that cut back saw an 18% reduction on average.
And, with spending on essential items such as housing (71%) communications and TV (70%) groceries (65%) and fuel (58%), as well as non-essential items including, charity (60%) beauty (59%), holidays (55%) and alcohol and gambling (54%), all expected to stay the same or increase in the coming months – it’s never been more important for brands to stay front of mind.

However, at a time when the cost of living is rising, brands have an important part to play in putting people first. Over four in five (83%) believe brands need to be transparent about any price increases, three quarters (75%) feel brands and adverts need to acknowledge that things are harder for some people financially, and a further 72% feel more positive towards brands that help them find the best price.

Building trust among consumers
As we turn our attention to Q4, brands will need to work harder than ever to build strong, emotional connections to maintain or grow brand equity in the lead up to the busy Christmas period.

While OOH’s ability to keep brands front of mind has long been proven, its ability to influence short-term commerce online and offline is often under-appreciated. We’re now seeing a growing number of people shopping while on the go, with our recent Mobile Pound study revealing over half of all mCommerce spending now takes place while people are outside of their homes.

In a world where a purchase can happen at any time and in any place when outdoors, OOH has become a virtual shopfront for brands and the rise of mCommerce provides a huge opportunity to use advertising in a smarter and more creative way to increase purchase intent and drive sales.

Advances in Out of Home technology combined with richer data sets mean that today, OOH planners can segment audiences based on their online and offline purchasing behaviour by category, right down to location, environment and even individual frame level. This means that planners can select frames that a particular audience are most likely to see throughout their day.

Dynamic messages and QR codes allow planners to take this a stage further by enabling the delivery of contextually relevant and engaging messaging – which can be acted on in the moment. This includes changing messaging by location, time of day, mindset or purchasing behaviour (online or offline) to trigger action in a consumer.

This, matched with rising TV inflation, has meant that OOH will have a key role to play in extending reach, improving brand saliency, and influencing both online and in-store purchasing – proving itself to be the channel with the highest reach of all commercial advertising and creating a feeling of reassurance and trust among consumers during a time of huge uncertainty.

Nicole Lonsdale is chief client officer of Kinetic Worldwide.

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