In the 1980’s US fast food chain A&W introduced a new burger.
The burger was a third pounder. Designed to rival McDonald’s wildly popular Quarter Pounder.
A&W had high hopes for the burger. It was launched under a “Third is the Word” campaign and sold at the same price as the smaller McDonald’s Quarter Pounder. They bought up all the best TV and radio advertising spots. They gave it every chance to succeed.
But the new third pounder failed. Badly.
A&W couldn’t understand why. Until they did some market research.
More than half of consumers thought they were being ripped off. “Why should we pay the same amount for less meat?” they said.
The value of the new A&W burger depended on comparing two fractions: 1/3 and 1/4. But we’re not used to comparing fractions. Our brains jump to the closest available whole numbers. 4 is bigger than 3. So people thought that the 1/4 pounder was bigger than the 1/3 pounder.
A&W launched a burger that was better value. But consumers thought it was worse value.
So they didn’t buy it.
Why are we talking about this? We are all really close to what we do. Close to our categories and brands. Close to our communication and activation. Close to our pricing and promotions.
But shoppers aren’t. They think about categories and brands much less than we do. They see much less than we see. They care much less than we care.
As Alfred Taubman, owner of A&W at the time, said, “sometimes the messages we send to our customers through marketing and sales information are not as clear and compelling as we think they are.”
What is clear to us is often not clear to shoppers.
To change this we need to make things as simple and intuitive as possible.
So, how can you do this?
Location in Store. Categories are blurring. Brands that are well established in one category are moving into other categories. Different formats of products (e.g. coffee) are in different places in store. Different versions of products (e.g. plant based) are in different places in store. It’s often not obvious where a product will be.
So, you need to make it simple and intuitive. Be where shoppers most expect you to be. Then tell them where you are. If you’re a biscuit be in the biscuit aisle. Then tell shoppers you’re in the biscuit aisle. Don’t bury the treasure.
Layout & Merchandising. Manufacturers think decision trees tell them how to layout fixtures. But no shopper is walking around a store with 30+ decision trees in their heads ready to be activated when they walk down an aisle “right, deodorants…do I think brand or format first?”
The priority for any layout and merchandising solution is to be simple and intuitive. A shopper should be able to glance down the aisle and immediately get it. The quicker they get it, the quicker they can start shopping and buying. Shoppers shop aisles (& online pages), not flow charts on a ppt slide.
Range Architecture. Navigating range used to be easy for shoppers. You had good, better, best across retailer own label. Most brands had a standard tier and a premium tier. There were small, medium, large packs. Now where do shoppers start? Multiple different price tiers. Multiple different benefits. Multiple different pack sizes. All blurring together.
A range need to be simple and intuitive. Clear price differentiation. Clear benefit differentiation. Clear pack size differentiation. Supported with clear communication. Shoppers want to make easy choices they can feel confident in. Not have to do a cost benefit analysis down every aisle.
Activation. There was a time when retailers wanted to strip back on brand activation and communication. Clean store policies. Make it easier for store staff. Make it easier for shoppers. But that is changing. Quickly. Retailers can make money. Brands are happy to spend money. So you see a proliferation of similar activities. Competitions. Free gifts. Free tickets. All competing for attention. All creating noise for shoppers to filter through.
Activation should be simple and intuitive. The best activation is connected – to what you are doing out of store. It’s consistent – over time and across touchpoints. It’s repeatable – continually reinforcing what you stand for. Innocent haven’t got bored of The Big Knit. Nor have shoppers.
The simple and intuitive principle applies across the board. To pricing. To promotions. To messaging. To design.
The best brands know this. The best retailers know this.
If only A&W knew this. Guess what they’ve just done.
They’ve relaunched the 1/3 pounder. They’re calling it a 3/9 pounder.
Well, that finally clears things up then…?!
Feel free to forward. Have a great weekend. Speak to you in fortnight.