Recession-hit companies target female customers

Thought provoking piece in this week’s Economist outlining ways in which firms are increasingly targeting purses rather than wallets. What seems extraordinary is that this hasn’t been a more widely used strategy in the past. Especially when you consider that in America, female consumers are said to makeup to 80% of all discretionary purchases – that is buying most day-to-day products and services.

In what way have companies been trying to boost their sales by tailoring their products and messages to appeal to women? Which examples can you think of?

A few from the article include:

Frito-Lay, a snack-food company owned by PepsiCo, has launched a campaign called “Only In A Woman’s World” to convince women that crisps and popcorn are not just for male, beer-guzzling sport fans.

OfficeMax, America’s second-largest office-supplies company has redesigned its notebooks and file-holders to appeal to women and has run advertisements that encourage women to make their workplaces more colourful.

McDonald’s was a sponsor of New York Fashion Week in February, promoting a new line of hot drinks to trendsetting women.

Why has it taken a recession for firms to target women? After all, it is hardly news that they control the vast majority of consumer spending. They buy 90% of food, 55% of consumer electronics, and most of the new cars.

In addition, some research suggests that they are loyal more likely to continue to buy a brand if they like it. They are also more likely than men to spread information about products they like through word of mouth and social-networking sites. And so far in the recession, jobs have been lost in male-dominated fields, like manufacturing and construction. This means women may bring home a greater share of household income in the months ahead and have even more buying power.

Go girls! But marketing to women may not work for every company. In particular, for firms (such as some carmakers) with brands that are regarded as strongly male, “gender bending”, or trying to attract the opposite sex, could enhance short-term sales but cause a longer-term decline. But as the article points out, in this recession having a tarnished brand is better than having no brand at all.