U.S. Consumer Promotions in 2021
26 Jan 2021
The year 2020 proved to be one of the most challenging years in recent history.
The global pandemic and resulting unemployment, job loss, business downturn and permanent closures took its toll on the effectiveness of CPG marketing. Due to shortages and pricing for premium brands, consumers began to drift from the brand loyalty of which they were accustomed to try competitive products and store brands. Ecommerce replaced in store shopping and consumers also experienced an emotional tug of war between brand familiarity and variety.
With the calendar finally turning to 2021, the U.S. is experiencing a whole new level of optimism. From multiple vaccine approvals and distribution, financial stimulus finally being delivered to most Americans and the change in leadership, there is reason to believe that 2021 will deliver a positive boost to consumers shopping activity.
The commonality between the struggles of 2020 and the optimism for 2021 is that brands will always need to compete for business. And one of the most effective ways of capturing new customers or retaining the customers they already have is to run effective, sales-driving promotions.
When competing for a consumer’s attention, big headlines, bold offers and an increased chance to “win” are all driving factors for generating sales. However, the bigger the offer, the bigger the financial risk may be to the brand. There is always a fine line between maximizing the budget to drive sales and the risk of over redemptions that can cost thousands to tens of thousands in extra budget.
The solution to balancing the risk and the reward is to let someone else take the risk while you reap the reward. And that is where Fixed Fee budget protection solves the problem. A Fixed Fee locks the budget for the brand manager and provides complete financial security. VCG Promorisk is one of the few organizations that provides this type of budget protection, which gives brands the confidence to run exciting consumer promotions without any of the financial risk.
With the promise that the new year brings, the time is ripe for looking at new ways to capture new customers and retain the ones you have. Why not go big and leave the risk to VCG?
Len Hartz, VCG The PromoRisk People, email@example.com