United Kingdom

Details

  • Service: Advisory, Management Consulting
  • Type: Business and industry issue
  • Date: 16/02/2011

Paying the Price for Recession 

Pricing trends during the recession and implications for future strategy

  

We conducted independent, anonymous opinion research among 200 UK-based senior decision-makers on pricing during the recession and their future strategies.  This report sets out the findings from our research and our views on what is now required in the post recession climate. 

 

Examine the key findings by selecting a theme below

Race to the Bottom

Not surprisingly, firms reacted very quickly to the financial crisis and went in to near-panic mode, discounting prices across the board without fully understanding the impact on demand or profitability.  The legacy has been dramatic and in many industries recession-driven discounting has fundamentally eroded the value of the market.  Consumers’ price expectations are lower and buying behaviour has changed.

The Impact of Unsustainable Pricing

Whilst business leaders recognise that current price levels are not sustainable, they also recognise that downturn discounting has re-set the price baseline for consumers, who are now unwilling to pay more.  Coupled with inflation and rising input costs, many organisations are being squeezed from both sides.

The Wrong Customers

The research also shows that many business leaders cannot identify who their most profitable customers are, and do not have the information available to understand the impact of price changes on demand patterns.  Moreover, many respondents worry that recession-driven discounting has attracted and retained less profitable customers which has serious implications for the go-to-market strategy.

Future Strategies

Even as organisations understand the need to re-align pricing and are keen to introduce premium priced products or variable pricing, there is not a great deal of confidence in being able to execute such strategies.

Recommendations & Questions to Ask Yourself

These findings lead to our 5 key recommendations and 10 questions to help you identify opportunities to generate value in the post-recession world.

Contact

Contact

Mona Bitar

Partner
KPMG in the UK

020 7694 1898 | mona.bitar@kpmg.co.uk

 

Paying the Price for Recession

Download Full Report

Paying the Price for Recession: Pricing trends during the recession and implications for future strategy

 

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Read Press Release

UK businesses pay a high price for downturn discounting

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Martin Scott discusses key findings

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