The president of Walmart’s UK subsidiary, Asda, has predicted that the current economic crisis will fundamentally change consumer behaviour and that retailers who fail to adapt to the new reality will not survive.
Speaking today (11 December) in London at a seminar on the recession organised by Asda and the Centre for economics and business research (Cebr), Asda president and CEO Andy Bond said the crisis was already affecting customers’ shopping habits.
“The era of conspicuous consumption is over – saving money by cutting out waste of all kinds will be the priority,” he said. “I don't see this as being a short-term response to the recession but a fundamental shift that will see the emergence of a new breed of customer.”
Mr Bond claimed consumers were not prepared to pay a premium when they “could not taste the difference” in an apparent reference to rival retailer Sainsbury’s premium private label range.
He said the new emerging consumer would demand more value for money than ever before and genuine price transparency, arguing that retailers would have to respond by adapting their business models if they are to survive.
“Retailers with authentic low cost operating models, who embrace sustainability as a means of reducing costs and who are transparent about how they pass savings on to their customers will be the winners,” said Mr Bond. “Those who continue with high/low pricing will become increasingly distrusted.”
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