Reconsidering COVID-19’s Impact on the Concept of Value and Relationship With Price
Prior to COVID-19, the most recent cataclysmic event that demanded a reexamination of value was the Great Recession (2007–2009). The Great Recession revealed how notions of value — what it is and how it is expressed — had changed in some crucial ways, pointing to what The Hartman Group termed a New Value Paradigm.
With its devastating toll on human life, civilian employment and economic markets, one certainty is that the COVID-19 period has had a profound effect on consumers’ attitudes, perceptions of value and purchasing patterns for the foreseeable future. As such, this unprecedented moment demands that business leaders develop a culturally informed and nuanced perspective of value as they brace for changes to the landscape and adapt their strategy.
Our white paper, Value in the Time of COVID-19, discusses how where engagement with value tended to focus on money and managing resources, value in the time of COVID-19 is about both resources and responsibilities interrogating individual consumption practices within the larger socioeconomic context.
Consumers’ Fluctuating Relationship With Price
The New Value Paradigm recalibrates price as one of many dimensions that may rise and fall in importance, depending on the consumer, the occasion and the category. This is not to suggest that price is not a critical piece in the calculus of value. Rather than simply asking “What is the price?”, the central questions of the New Value Paradigm are “Is this the fair price?” and “Is it the right price?” This demands an interplay with the other components of value (quality, experience, quantity, etc.) in order to properly assess the price dimension.