Jed Simpfendorfer.
Jed Simpfendorfer, Director of Strategy & Partner, T garage
The funny thing about pricing is that marketers spend far more time thinking about it than consumers ever want to.
Consumers don't wake up in the morning wondering whether Every Day Low Pricing is more effective than high-low promotional pricing. They're thinking about getting the kids to school, what's for dinner, whether they remembered to pay the electricity bill, or if the Bombers might finally string together a decent season (nope).
In fact, most consumers would happily never think about pricing at all.
Yet somehow, we've built a system that requires them to think about it constantly.
Twenty years ago, when I was working on Toilet Duck (glamorous, I know), we spent endless hours debating Every Day Low Pricing versus promotional pricing. We treated it like a category problem because we could. Which approach would drive volume? Which would maximise margin?
Today, Australians aren't suffering from a shortage of discounts. If anything, they're drowning in them.
Walk through any retailer, and you'll find half-price offers, member pricing, bonus points, price locks, app-only specials and multi-buy deals. Then there are fuel discounts, insurance comparisons, electricity plans, mobile plans and subscription bundles.
Everywhere you look, somebody is offering a deal.
Yet consumers have never seemed more exhausted.
What we see in our research isn't bargain hunting. It's survival.
People are planning meals around what's on special. Delaying purchases until the next promotion cycle. Timing fuel purchases. Comparing insurance policies. Chasing loyalty points. Looking for discount codes before they buy online.
At some point, we've stopped shopping and started doing unpaid admin.
Individually, none of these behaviours seems significant.
Collectively, they amount to a second job.
The hidden cost isn't the money. It's the mental effort.
Every time a business creates a pricing structure that's harder to understand, it transfers work from itself to the consumer. Every promotion that requires comparison, calculation or careful timing asks consumers to do a little more work.
For years, we've measured price, value and promotional effectiveness. What we've largely ignored is cognitive load.
Consumers, however, haven't ignored it at all.
Increasingly, simplicity itself has become a value proposition.
And beneath that sits something even more important, trust.
One of the strongest themes emerging from our CultureCast work this year is the continuing decline in trust. People are questioning institutions, media, governments, employers, and, increasingly, brands. There’s not a lot new there.
What is emerging is the increasing role that price is playing as part of the trust equation.
The old pricing question was: what's the optimal pricing strategy for this category?
The more relevant question today might be: how much work are we asking consumers to do?
The challenge for brands over the next few years won't simply be proving value. It will be reducing effort.
Consumers are already carrying enough mental load. They're managing rising bills, comparing providers, chasing discounts, monitoring subscriptions and trying to stay ahead of the next price rise.
The brands that win won't necessarily be the cheapest.
They'll be the ones who ask the least of people.
If you are interested in hearing more, check out a previous opinion piece by my Colleague Kevin Crouch on the shifting aspiration gap, and what it means for marketing In the Trends: Proof, not promises - AdNews.