Reduce 2 the max, increase satisfaction

At first glance, „Reduce to the max“ is a successful price strategy implemented by discount stores: maximum profit with a minimum range of products and minimum prices.

German retail discount stores in particular are quickly expanding with this business principle in Germany and all over Western Europe. Every eight days, Aldi opens new store facilities, Lidl is expanding on a similiar level.
Looking at the situation a second time, this success is based on far more than just a low price strategy. Deep down, consumers enjoy – albeit usually subconsciously – the reduction of purchase opportunities in discounts stores because it offers a new kind of freedom: reducing the complexity of everyday shopping.

„Reduce to the max“ for discounters means less complexity for consumers, which in turn makes shopping easier and more comfortable. There is more time to study products and brands intensively.The desire for a reduction of complexity makes sense when the recent market data are concerned. The enormous amount of products and brands – which are professionally marketed today – is no longer perceived as convenient by consumers. It has exceeded the critical threshold and often leads marketing and communication activities to have exactly the opposite effect. In many case, new offers are perceived by consumers, not as new opportunities, but rather as „added stress“.

How can marketing and communication strategies deal with this new „complexity“ challenge? How can they reduce complexity to the max? rheingold studies have ascertained a number of values which – though in part unconsciously – are strongly favoured by consumers today. Three of these values are described in brief here: continuity, innovation, concentration.

Continuity reduces complexity because it minimises the psychological cost of orientation for consumers. If they feel forced to adopt a new perception of markets, brand and products, they ask for real innovation and not just a variation or a new decoration. They reject the idea of new wine in old bottles. Consumers want to simplify the way everyday products are used and purchased. To a certain extent, they welcome all-in-one solutions provided that these are easy to use. Consumers like it when brands concentrate on their core competence. They prefer a modest and thorough expansion of product ranges.

In the end, each of these three values – continuity, innovation, concentration – makes everyday life easier and more comfortable for consumers in Western Europe – Reduce 2 the max is a popular approach among consumers. Paradoxically, less is more nowadays and reduction offers greater success on the market.

© 2015 rheingold