José Luis Martínez of Larramendi: "The impact of the 'low cost' is not a fashion, is the future"
November 18, 2009
The new role of the concept price as a driving force in the decision-making process, as well as the criteria that currently are driving the consumer behavior gained a role in Congress AECOC 2009.
According to José Luis Martínez of Larramendi, CEO of Primark, in times of economic difficulties consumer becomes more sensitive to the price, which becomes a powerful instrument of commercial action. What happens is that today consumers seek low prices on an ongoing basis, on a daily basis, not so much to buy 'cheap' but as an opportunity for smart consumption.
For Larramendi, this consumer behavior is that justifies the birth of the 'low cost' phenomenon that, from his point of view "should be installed in a structural way among us, won't be with the crisis". The director-general of Primark also believes that the impact of this phenomenon "has only just begun;" "the pace of implementation will increase, will be known, will live an explosion greater than the current". It also adds that the 'low cost' "is not a fad, will go beyond the crisis, is the future".
Martínez Larramendi unveiled in addition what are the strategies behind the success of the business model of Primark. Among these, the supply of products of high quality at low prices, own design and direct negotiation with suppliers (without intermediaries), reduced margins, high rotation of product in store, adaptation to local consumption trends, continuity in management teams and advertising based on the "mouth to mouth".
"Secondary brands wrong pass it"
Director commercial and goods of the Carrefour group and member of its global Executive Committee, Ignacio Gonzalez, bet in his speech at the Congress AECOC retailers marks and brands innovative manufacturers such as large pitted after the crisis.
From his point of view, the fifths, sixths and successive marks "pass through problems" because of the new demands of the assortment. In this sense, Ignacio Gonzalez insisted that "Carrefour is marquista" and will remain it, although he explained that "the mix is the way to cover needs but not the different ways to cover them;" "we want to sell brand but also that the trademark moves." The Board of Carrefour also added that "the crisis is an opportunity to reinvent our industry;" "an opportunity to give the consumer what they are looking for, not what we want to look for, and a chance to collaborate".
The delegation also highlighted the fundamental importance of offering consumers appropriate responses to new needs. In this sense, he added that "today the satisfaction is not enough, you have to love the consumer, be positive, tell different things." "The purchase not can be a problem for who does not want to complicate your life". Ignacio Gonzalez also advocated regain some optimism and make life easier for the consumer.