Speaking at Retail Week’s conference this morning, Lewis highlighted customers who were deeply concerned about future income due to recent or feared redundancy.
“It is about confidence; people are really nervous about what is going to happen.”
He said: “If you are one of those people your assessment of value changes. You revalue your concept of value.”
He believes this is not just about price. He said people do not want to risk spending money on something that may break or not work as reducing wastage is foremost in their minds.
Quoting a customer that he had recently spoken with, Lewis said that she did not “want to feed the bin.”
To highlight this shift in consumer behavior Lewis highlighted different products, one being the “humble stock cube”.
Unilever is selling a new stock pot, a gel version of the traditional stock cube, which is twice the price of its other stock products. Despite its higher price sales of the product has soared, buoyed by people eating in more. This trade is seen as small in terms of the savings from not going out to eat.
“As people are concerned in their mind about what is going to happen they come back to the family. Something about bringing the family back together is very reassuring in these times.”
Creating products that tap into this new mind set Lewis said proves that innovation should not be forgotten even in a recession. “It is a fantastic way to get people to reevaluate value.”
He stressed that with innovation, giving customers more value for their products and really understanding the practical and emotional needs of your customer would be key in the downturn.
“Customers are much more critical in crunch times than good times. They don’t want waste and want products that deliver and beat expectations.”
He did warn however that one of the biggest problems that businesses are facing is the change of exchange rates. “It means that by doing nothing a company’s profits can be knocked off.”
He added: “In times of adversity people become more creative and more resilient.”
He concluded: “There really is opportunity out there."