Novel Ways to Beat Inflation

So are we in a recession again then or not?

We're getting some interesting mixed messages...

Back on the Bubbly...
On the one hand we have reports that we're supping back the champagne like in the boom times (http://bit.ly/eXwlm1)  (I have concerns about the market data being presented though as the source is Wine Intelligence, which, beyond a couple of glasses, is plainly an oxymoron!)

...as another Economic Bubble Bursts?
But on the other hand we're told that the economy is shrinking and fears grow of the double-dip that has been hanging around like a bad smell in all discussions of the economy during the past 12 months (http://bit.ly/dWCpDm)

Inflation fears Blown Up?This time we should perhaps be concerned by dual threats of consumer spending drops and the ugly 'F'-word - inFlation...so what are ever attentive businesses doing for consumers in these difficult times?

Well here's where it gets interesting.

Companies such as Cadbury, Nestle and Mars have relied on the tried and tested way to beat inflation...just give consumers less for their money (http://bbc.in/ggJU4p).

Just do Less
So with this idea in mind, I've been thinking up some more ways to prevent the onset of inflation...forget customer service and start offering less for the same price - surely the way forward.

So taxi companies - forget about rising fuel prices - simply drop people off half way home and charge them the normal fare.

Dentists just put half the filling in - is the cavity half full or half empty - come on people these are hard times, chest out - walk straight!

Postmen - just let everyone know you'll be standing on the corner between 8.45 and 9am and we'll come and get our letters - and binmen, I'll chuck it in the back for you if you just give me a knock.

So come on Cadbury - don't hide your genious behind "economic reasons" and argue that it's still "a very affordable treat" - admit that you've had a brilliant idea...the Oi consumers, stop moaning and just fork out the same cash - it hasn't gone up you know approach to beating inflation...

The Other Way - Responsible and Inventive Corporate Governance
Rather than celebrate Cadbury's slightly dubious (though fairly standard) decision, in a more serious tone we should look at how the steadfast preservation of margins can add momentum to inflationary pressures and is often used as an excuse to pass on costs over and above those actually incurred by a business.

Instead we should maybe look to the example of Unilever where, in the laundry category in Argentina during the economic crisis in 2000-2002, they offered economy packs both smaller (but for less!) and larger (offering more for less) to assist cash-strapped consumers (http://bit.ly/fk6iNb). They also accepted temporarily lower margins in products speficially targeted at low-income consumers, and worked with retailers to ask them also to accept lower margins in order to hit the price points needed while they rode out hyper-inflation - and they came out stronger on the other side.

Of course it's easier to just take a chunk of chocolate out of the consumer's pocket - but more creative approaches to beating inflation and marketing in a recession are required to avoid the negative publicity that downsizing creates (http://bit.ly/ftrh1U).


As usual the views of AH - check out this post on our website at http://meridiansp.co.uk/_blog/Blog_Highlights/post/Novel_Ways_to_Beat_Inflation/.