MARCELA PÉREZ DE ARCE
Client Service Director
Millward Brown, Chile
Client Service Director
Firefly Millward Brown
It is not news that consumers have undergone profound changes in recent years. Specifically in Chile, these changes have deepened noticeably in the past two years and are marked by three essential phenomena: digitalization, both in terms of social participation and consumption, consumers’ growing lack of confidence in the economy and institutions, and consumption premiumization, from coffee and yogurt to jewelry. In the context of an economic slowdown, the landscape looks extremely challenging: Consumers want it all, together and conveniently... How are brands responding to this changing environment?
IN CHILE, EXPERIENCE RULES
Today in Chile, it is experience that rules. In terms of either services or mass consumption products and retail, consumers prefer those things that make a mark on their purchase experience, their consumption, or even their recall of advertising.
While in some countries salience – meaning the establishment of a quick bond with the specific consumption need – works better, in Chile many brands have discovered that today’s consumers demand a more enduring bond.
It is important to remember that the three brand strategies (salience, meaningfulness, and differentiation) are complementary, and that the preeminence of one over the other two is closely linked to the particular category a brand belongs to. For example, when it comes to cars, brands in that category will usually tend to highlight the driving experience or the aspiration of being seen driving a certain car model. But when it comes to soft drinks, in most countries brands will tend to automatically relate to thirst and the need for easy enjoyment. Meanwhile, luxury brands will look for differentiation wherever they are.
So... what have brands done in Chile? A growing trend is the emergence of the “Chilean Premium”. These are initiatives with a local touch, either Chilean or Andean, focused on the life in the neighborhood, trying to relive childhood memories, or restoring the value of native cultures, without forgetting about quality. In other words: mere experience.
A clear example of success in this line is Emporio La Rosa: an ice-cream shop born in a traditional neighborhood in Santiago that has become a renowned coffee shop chain. The solidity of the brand and what it represents has allowed the presence of its coffee shops to reach even inside shopping malls without losing their neighborhood touch. Food brands such as Tika or Buka, decoration stores, coffee shops, beer brewers, and restaurants have delivered a design of a local quality experience that does not initially imply high prices but that can afford to set prices appropriate to their quality because they deliver not only a product, but also an experience connected with consumers. It seems this trend will prevail in the future not only because it has successfully shown its sustainability, but also because it has created consumption areas and types of consumers that previously seemed alien to those domains. This is a different commercial attempt, in dialogue with marketing strategies that are also different as well, consistently conceived for all its points of contact with these neo-consumers. It also relates to the back to basics concept, since it shows it can perfectly coexist with high quality products and services.
Another trend, 100% oriented to experience is e-shopping, a sphere where the Dafiti brand has completely redefined the landscape of clothing shoppers in Chile. There is no doubt Dafiti’s consolidation results from a great shopping experience, accompanied by low prices, wide variety at a single site, an easy purchase method, delivery to any place consumers want, and the possibility of returning the product bought and receiving a complete refund. All of these make Dafiti an addictive experience. Online purchasing is not limited to this brand. There are a potent and growing percentage of retail sales – particularly large stores and supermarkets – being made through this platform. The important thing is that today digital display reflects a different purchase experience, one that meets certain needs and allows a kind of contact with the brand that exists only in that medium. The digital world has its own rules, follows its own patterns, and establishes specific relationship codes that also constitute purchase experiences, rather than canceling them.
Both trends have emerged from successful strategies aimed at building meaningful brands for consumers. An essential part of this formula is the great experience, but both of them have also made efforts to fight consumers’ growing mistrust, in a context where value must be continuously justified.