How to Achieve Brand Growth Amid Rising Inflation

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Advice from the experts at gfkconsult.

Countries around the world are experiencing the highest rates of inflation in decades, with an average year-on-year rise of 9.6% recorded in May 2022 across 38 countries—the sharpest price increase since 1998. What’s more, the number of OECD countries now experiencing double-digit inflation rose from 13 to 15 between June and July 2022 alone. 

Inflation is not going away anytime soon. And it is probably the biggest talking point for business leaders and executives around the globe right now. However, despite the challenges created by the current economic climate, it is still possible for brands to achieve sustainable growth if they adopt the right brand strategy and positioning. 

gfkconsult has six recommendations that could help your brand win the market and ride out the predicted forthcoming recession with success: 

Time and again, history has shown that brands that continue to advertise and innovate in times of crisis will emerge stronger than those that cut their marketing budgets. Of course, it is tempting to reduce your spending when the economic chips are down. But there is a very real risk that you will be left behind by your competitors and end up in a position where it is difficult to regain lost market share. 

At GfK, our advice is not to stop spending, but to optimize it. “Make sure you remain visible to consumers and drive ROI from your marketing activities by investing in the right media mix for your target audience,” advises Madalina Carstea, Head of Global Solutions, Brand and Marketing Intelligence at GfK. “Tools such as GfK’s Marketing Mix Optimizer can help you optimize your marketing spend across the right combination of digital and offline channels, so you get maximum ROI from your activities. Improving productivity is also key at this time to balance out top- and bottom-line growth. 

“Also, do bear in mind that there is an opportunity here. Some of your competitors are reducing their advertising spend right now, helping your business cut through the noise—meaning you could win yourself a bigger share of voice and drive brand growth in the process.” 

2. Strengthen your unique selling proposition (USP)

Differentiation sells. Even at the present time, when consumers are counting the pennies, there will always be a portion of the market that is willing and able to pay a premium for the brands they want, not just those that they need. Indeed, the GfK Consumer Life Study 2022 found that 42% of global consumers still feel it is important to pamper themselves on a regular basis. 

And while pricing must be approached with the utmost care, one strategy well worth considering is cultivating, communicating and thus strengthening your brand’s USP, and using this as a lever to increase loyalty and brand advocacy. 

Why? Because a GfK study in 2021 showed that a brand’s uniqueness is the most important driver when it comes to the ability to charge a premium. Finding your point of differentiation will also help foster that all-important feeling of brand attachment among your customer base, which is the second most significant factor driving premium sales. 

In order to grow, it is therefore essential to create and nurture a dedicated community of loyal customers who keep your business top of mind and act as brand advocates, helping to bring in new customers. In fact, in the current financial climate, customer loyalty is priceless. 

3. Prioritize brand growth at all levels

Leading from the top down is essential for brand building to succeed. Executives therefore need to take a keen interest in promoting and embedding the company’s brand at every level of the organization, as well as in the marketplace. 

By becoming brand champions, business leaders act as guardians of the company’s brand values and purpose, leading by example to make sure these are communicated effectively both internally and externally. 

Jutta Langer, Vice President of Consulting at GfK, elaborates: “A consistent approach to brand growth, led by the board and cascaded throughout the organization, must be made a top priority. Naturally, the current macroeconomic challenges demand the close attention of executives and staff. But retaining focus on brand identity is critical to maintaining and growing market share, especially when your competitors may be cutting their advertising budgets and losing visibility as a result.” 

4. Maintain brand consistency across key consumer touchpoints

As noted above, nurturing brand loyalty is a crucial ingredient when it comes to tackling the problems caused by inflation. But it is harder to achieve in 2022, with 60% of people saying they may stop buying their favorite brands because of the cost-of-living crisis, and 85% saying they are actively seeking out cheaper alternatives when shopping. These figures are supported by our own research, which found that now, only 43% of consumers buy from a trusted brand—down 5% from 2020 figures. 

In this difficult environment, keeping your brand image and identity consistent across all consumer touchpoints and at every stage of the buying journey is essential to creating and maintaining brand attachment. Any inconsistency in brand positioning between product development, marketing communications and sales execution will be highly noticeable to consumers, especially those using digital channels, and will almost certainly have an adverse impact on sales and brand growth. 

“Collaboration between business functions is one of your most important weapons in the battle to gain attention and engagement in today’s fragmented consumer landscape,” says Langer. “To achieve this, you need access to accurate and current consumer data that represents a single source of truth, which is another way that GfK can help. This creates the necessary resilience to adapt to fast-changing market conditions, while helping companies prioritize their sales and marketing activities. 

“We specialize in providing access to a market-leading collection of consumer insights gleaned from a variety of sources, including 174 million households in 17 countries. Our expert team continually works to align millions of consumer interviews with our unique, highly granular point-of-sale data that is collected weekly at store level.” 

5. Revisit your audience segmentation data

If your business is still using pre-pandemic consumer profiles, it’s time for a rethink. Shopper behaviors have transformed in many ways since the outbreak of Covid-19 and continue to evolve in the wake of spiraling energy, fuel and food costs. Creating revised buyer personas that reflect the demographic realities of 2022 is therefore a must if brands are to understand and meet the changing needs of their audience. 

Unfortunately, segmentation is much more difficult than before the pandemic, with 59% of UK marketers saying they are now finding it harder to predict consumer priorities. Harnessing the power of AI-driven segmentation techniques, supported by machine learning and analysis of the latest customer profiles and spending patterns, is indispensable to creating campaigns that resonate and bring in both new and repeat business. 

An essential part of segmentation is to identify the growth areas of key consumer clusters—driven by consumer mindset and behavioral contexts—that allow brand growth to be generated incrementally in both the short and the longer term. That means really getting under the consumer’s skin to understand their behaviors, beliefs, desires and aspirations. 

6. Combine the forces of AI and human expertise

Making use of the latest technologies will certainly give your business a competitive advantage. But the importance of the human touch cannot be underestimated, says Carstea. “Powerful analytical tools such as GfK’s Marketing Mix Optimizer are a great place to start. However, putting a layer of human expertise on top of this is hugely beneficial; you could think of it as adding the final piece to the jigsaw puzzle. 

“Here at gfkconsult, we offer the best of both worlds. By combining GfK’s unrivaled human expertise, proprietary data insights and AI-backed technology, we provide strategic consultancy to facilitate sustainable growth and optimize ROI, despite the challenges posed by inflation and recession. 

“We empower brands to unlock their full potential by targeting the right consumer segments and evaluating the impact of all aspects of their marketing activity on sales, while assessing the contribution and efficiency of each marketing channel.”

Create a winning strategy with gfkconsult today. For more information and to arrange a no-obligation consultation with a gfkconsult expert, please visit gfkconsult.

This article originally appeared in Business Reporter.

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