We offer consumers “the right to pay less” with a sales revolution in Brazil

Abstract

As household income declined due to the impacts of economic recession, consumer sales dropped in Brazil, creating challenging conditions for retailers and shopping centre operators. For Sonae Sierra Brasil, a key challenge was to help our tenants to recover their sales and reduce their accumulated stocks. We wanted to launch a sales campaign – but no ordinary sales campaign. Consumers felt frustrated and we wanted to speak to them in a language that would resonate with their own economic difficulties. Hence we created “Revolutionary Tuesday – The Right to Pay Less”, a highly visible campaign that would offer goods at attractive prices. Using just under 1.5% of the allocated marketing budget, the campaign brought in 43% more visitors, generated an 83% increase in sales and received positive recognition from consumers.

Introduction

By the middle of 2015 the retail market in Brazil was experiencing the impact of deep economic recession. Unemployment grew steadily, household income dropped, inflation rose and there was a fall in investor and consumer confidence. Consumers changed their habits: they were concerned about the reduction in their income, anxious about their job security and worried about the country’s future. They started to make more rational decisions, reduced impulse purchases and restricted consumption, even at Christmas time, when retailers had hoped that sales would improve. But they didn’t. Considering this scenario, Sonae Sierra Brasil came to the conclusion that carrying out one more New Year sales campaign wouldn’t be the best way to get people out and shopping. We had to think up another approach.

Background

As tenant sales began to fall relative to inflation, with a knock-on impact on rents, Sonae Sierra Brasil had already embarked upon a cost savings programme. This had enabled us to reduce the service charges for tenants. We were also deploying considerable efforts to promote sales growth, from optimising the tenant mix to launching promotions.

Meanwhile, outside our shopping centres, frustration with the economic and political situation was growing, with protestors taking to the streets on a regular basis. This didn’t offer an easy situation in which to market our shopping centres.

Challenge

Our main challenge was to help our tenants to recover their sales and reduce their accumulated stocks. We needed to support them by creating a new sales campaign that reflected the country’s social and economic context; one that could call people’s attention and encourage them to make purchases at Sonae Sierra Brasil’s shopping centres.

Even before planning our campaign, we knew that some internal factors would need to be addressed, and to do this we had to engage people from different company departments and win the support of tenants across our centres.

Moreover, it had to be communicated at a low cost – the marketing budget could not exceed 30% of the total budget for the campaign – meaning we would have to make the most effective use of the media channels available.

Solution

We came up with the idea of “Revolutionary Tuesday – The Right to Pay Less”, a highly visible, unheard-of and impactful campaign developed in line with the economic context that would aim to improve store performance and offer real benefits to consumers.

With less than two months planning time, we had to work hard to mobilize our teams and tenants, we launched Revolutionary Tuesday as a one-day campaign on Tuesday, 12^th January, a day and time of year when in-store footfall is typically low. It was a nationwide campaign in which all of Sonae Sierra Brasil’s shopping centres took part. We ran a highly visible yet cost effective media campaign which aligned itself with the popular feeling and language of the time – as people took to the streets to protest to the government for their rights, we pledged to offer a revolution in shopping, with the right to pay less.

To amplify the impact of the event, shopping centres closed their doors early on the evening before the campaign in order to prepare their stocks, revise their window displays and guide their teams for the following day, when shopping malls would be open at special times – some opening before their usual opening hours, others closing after their usual closing hours, respecting visitors’ preferred schedules in each town. We also allowed tenants to display their products within the mall area, provided that these stocks had a minimum discount of 25%.

When the day dawned, we achieved what we expected: across our portfolio, footfall increased by 43% and sales increased by 83% compared to the same day of the previous year, with some stores recording sales of up to 350% higher. Furthermore, we saw a 125% increase in shopping centres’ website traffic, and the campaign received significant positive attention through social media. This was achieved using just under 1.5% of the promotional fund’s total budget.

Closure

In a context of economic recession and popular resentment, Sonae Sierra Brasil cleverly crafted a campaign to motivate consumers to make purchases at reduced cost, thereby bringing more people into its shopping centres and boosting tenants’ sales.

Revolutionary Tuesday was well-received by consumers, and it also enhanced relations between Sonae Sierra Brasil and tenants, helping to instill greater confidence in our operational management.