What can we learn from the ACCC's decision to take legal actions against Coles and Woolworths?

Last week was a busy week.

On Tuesday, The Australian called to ask for comment on the ACCC launching legal actions against Coles & Woolworths.

By Thursday, just 48 hours later, we had 200 qualitative, in-depth interviews and a comprehensive research report completed with the help of Juno, an AI-led research platform.

That’s a lot of rich insight into how consumers are feeling, right now, and so I wanted to share three deeper insights that build our understanding beyond the headlines.

1. Loyalty feels good

Your best customers are your current customers.

It’s a rational connection, especially when it comes to shopping for groceries on a tight budget.

In the words of Juno, “Loyalty programs and discounts play a crucial role in participants’ shopping decisions, with many relying on these incentives to manage their budgets. The effectiveness of these programs in providing perceived value can influence brand loyalty and shopping frequency.”

But that’s not all.

Again, Juno: “Loyalty rewards create an emotional connection, making participants feel valued and appreciated, which can significantly boost brand loyalty.”

Consumers don’t always remember what your brand said, but they will remember how the brand experience made them feel.

So, how does your brand feel?

2. More than brand

The mistake people often make when talking or hearing about brand is doing so in isolation. Brand is never the only thing. What’s more, brand is rarely the most important thing. In reality, brand is always one of several factors that drive choice.

In Juno’s own words: “Woolworths and Coles are perceived to prioritise profit over customer welfare, adversely affecting trust and brand loyalty. Despite this, their convenience and lack of viable alternatives keep many consumers returning.”

Clearly, convenience and product availability are more important choice drivers than brand. Coles and Woolworths know this. So too do ALDI and IGA.

I commented in The Australian that “If you only position on price, it’s like a stool with only one leg, it is a very precarious position.”

It can be equally precarious if you only position on brand.

So when marketing your business, product or service, remember that there are 4 Ps for a reason.

3. Transparency builds trust.

The Australian ran one of their stories with this headline: “People before profits key to Coles & Woolworths regaining trust.”

As soon as I read that headline, I immediately thought of the B Corp movement, a community of organisations committed to making business a force or good, one of whose key tenets is the balance between people and profits.

Now I’m not suggesting that Coles & Woolworths might change their position on profits. But, they could learn something from one of the pivotal dynamics encouraged through B Corp’s certification standards, namely transparency. In service of communicating with greater transparency the value they deliver for consumers.

I’ll let Juno speak for itself: “Consumers express a strong desire for more transparent and fair pricing to rebuild trust.”

What’s true of B Corps is also pivotal to communicating value and building trust.

Be transparent.

This article was published following the news story 'People before profits key to Coles & Woolworths regaining trust', published on 30 September 2024.