Business Strategies to Capitalize on the American Dream
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The economic recovery continues to sputter on many fronts, the federal government’s approval ratings hover near the bottom of opinion polls, and the public is still very pessimistic about the economy . Yet, in spite of it all, nearly three-quarters of Americans report in a new survey that they are, or will soon be, living the “American Dream.”
In psychological terms, this disparity between people’s outward view of the world and their view of their own lives is called the “above-average effect” — people tend to believe they are better off than everyone else. In business terms, this phenomenon is called…an opportunity.
Forward-thinking business owners are riding out the recession by positioning themselves to capitalize on consumers’ desire to buy things that will bring feelings of security, happiness, calm and success. Factor in a current preference for small business over big business and you’ve got yourself the makings of a pretty solid marketing plan. [Related: Savvy Re-Branding Strategies Leverage the American Dream ]
Family, faith and freedom
While U.S. residents are spending more conservatively – three out of five won’t be vacationing this year – they also report a willingness to buy things that bring them true happiness or improve the quality of their lives. The new survey, by Citi, found Americans currently define their core values as “family, faith and freedom.” And they’re willing to spend if they perceive the product or service is contributing to those three cornerstones of the American Dream.
As it happens, they are also particularly interested in dealing with small businesses. Separately, a recent Gallup Poll found that Americans ranked small business as the one of the most trusted institutions in America, second only to the military. Faith in small business ranked higher than every other institution, including organized religion, banks, newspapers, schools and the police.
Smart companies are taking advantage of this perfect storm of consumer confidence and selective spending by massaging their branding to communicate quality, value and affordable luxury.
“Consumer confidence remains low in even the face of positive economic news,” said Jill Avery, assistant professor of marketing at Boston’s Simmons School of Management. “Consumers have begun to switch to lower priced brands and generic products to save money and are finding ways of doing without many of the products they bought regularly in the past,” Avery said.
“Savvy marketers will work with this emerging trend and offer products and services to consumers that soothe their anxiety about spending and help them to cope with the new economic environment,” she said.
Techniques to achieve this include offering lower priced versions of existing products (Tide Basic laundry detergent is one example), positioning products or services as affordable luxuries (skin care products as at-home spa treatments) and offering guarantees that assure buyers they’re not taking too big of a risk when making a purchase (Hyundai’s “return your car if you get laid-off” guarantee), Avery said.
Promises, promises
Finding ways to leverage Americans’ desire for a higher quality of life requires more than reinventing products or redesigning labels. To give the perception of real value, businesses need to keep their promises and assure customers they are trustworthy.
“You can give things brand names and say whatever you like, but the thing you will be known for by your customers is the promise you keep,” said Brent Earles, Vice President at Dallas-based private investment bank, Allegiance Capital, and former senior marketing executive at Sprint. “That is the heart of branding. If ever there is a time when you must keep your brand promise, be sure you do it when tapping into something as sacred as the American Dream."
Earles said the perception of what makes for a high quality of life has become increasingly simple for some. It can be an uncluttered life, a nice home, a little wine, a comfortable existence.
“You can tap into your customers at the place where your product or service is relevant to them. At that moment, people will do what they always have done. They will spend money for something they perceive is helping them reach their dreams and goals,” Earles said.
Earles warns small business owners to keep their focus, however.
“Don't change your business,” he said. “Don't add a bunch of new things suddenly. Focus on living up to your promise.”
Simple strategy
Brian Scudamore, founder and CEO of multi-national junk removal company, 1-800-GOT-JUNK?, has made a career of staying close to his original vision, while marketing his company as providing a service that will improve quality of life, while also responding to an increased call for environmentally friendly, socially conscious business practices.
“People can borrow or rent a truck and haul their own junk away,” Scudamore said. “But doing that responsibly – donating and recycling along the way – takes time, effort, and money.”
Scudamore’s company, which in 20 years has grown from one man with a pickup truck to an operation with 190 franchise locations and annual revenues of $89 million, has also leveraged consumers’ desire to focus on quality of life issues to build its brand.
“I believe most people place a higher value on spending time with family,” Scudamore told BusinessNewsDaily in an email interview. We give people their space back. Working parents can drive straight into their garage after work, kids can have a play area in their basement, and out-of-town guests have a room of their own. It’s really as simple as that.”