Recession pricing from the other side of the coin…

My 30 minutes of CNN each morning is not exactly a calming start to the day. The high-pitched, almost hysterical reporting - with edgy rock music at the beginning and end of each segment (remember when CNN did the news?) screams that there is an ugly recession about us and it appears that the sky truly is falling. To make us feel better though, the trusty CNN reporters tell us about all of the great deals around – on everything from our morning lattes to condos in South Beach. And, we’re told, we should feel free to demand the bargains from any company lucky enough to have our business in these uncertain times.

As a consumer, this certainly resonates. And we want our customers to continue to feel comfortable shopping with us. Here at Admiral Road we offer regular discounts to our customers as a part of our newsletters and Facebook pages and we have extra recession-busting coupons lined up for our Facebook group members.

I am however, a little worried about that guy making your morning latte. Odds are he hasn’t experienced any significant drop in his costs. And it follows that if the economy is sluggish, he’s probably selling fewer of those lattes to start with. Has his rent plummeted to meet the struggling economy? Of course not. So now, Mr. Latte Maker is making less money and is being asked for discounts left, right and center. What’s a guy to do? Hopefully he’s got the same kind of great, loyal customers as we do. But I’ve got a sinking feeling that he’s going to be discounting himself all the way to the poorhouse.

Admiral Road has been making personalized blankets since 2002.

Is cheap the new green?

If you had asked us a year ago what the most important trend for businesses was, and for children-related businesses in particular, we wouldn’t have hesitated for a nano-second – GREEN, GREEN, GREEN. An amazing variety of products and services all aimed at consumers with an appetite for all-things environmentally responsible cropped up and inspired us all to do a little better. But the shaky global economy has changed things. It’s been a while since I heard a company talking about how green they are…

Here’s a story I found interesting. Amy recently popped into a posh grocer in midtown Toronto. This store is one of a row of shops wryly known for their steep pricing as ‘The Five Robbers’. I don’t want to give you the wrong idea about Amy’s spending habits – it’s just that one of these Robbers carries a chocolate cake that you would practically mortgage your house for (and you almost have to). Amy noticed that a whole handful of products in the store had special packaging pointing out their recession pricing – about 10% off.

Now we could all use a break in these tough economic times – but I’m willing to guess that if you do your groceries at The Five Robbers, then 10% isn’t going to make or break you. So what gives? I think that cheap just may be the new green. I’ll bet a year ago that same store would have been touting eco-friendly products or packaging. I’m afraid that recession pricing at the toniest grocer in the city may be just another marketing gimmick. I think it’s designed to make the customer feel virtuous and responsible, much like a lot of the green marketing did. Does it work? I’m not sure. Ten percent off the world’s best chocolate cake is certainly a nice pick-me-up, but I’m hard pressed to think that sales are way up at that shop as a result. If cheap is the new green, what will be the new cheap? I wish I could predict it – but it’s no piece of cake.

Admiral Road has been making personalized blankets since 2002.