Marketers and retailers face an ongoing challenge: showing stretched shoppers that they understand customer budgets without making their brands feel like a bargain bin.

The affordability squeeze on is palpable. Consumer prices rose 3.7% YoY, according to the Bureau of Labor Statistics, driven by a 20.4% jump in energy costs, including a 34.2% rise in gasoline prices, which has a knock-on effect on products and services. 

As the economic pressure felt by consumers drags on, marketers and retailers have to find ways to keep their affordability messaging feel fresh. 

Marketers respond to affordability crunch

Trimming prices has been one way that brands have appealed to cost-conscious consumers. 

Brand marketers at PepsiCo chose empathy by initially announcing price cuts of up to nearly 15% on Lay's, Doritos, Cheetos and Tostitos just ahead of this year's Super Bowl (they hiked prices of popular products back up in September). 

"We've spent the past year listening closely to consumers, and they've told us they're feeling the strain," said  Rachel Ferdinando, CEO of PepsiCo Foods US. 

McDonald's has leaned on a named platform, McValue, then added Extra Value Meals and, reportedly, a "$3-and-under" menu and $4 breakfast bundle. Rivals like Taco Bell have used similar strategies.

The risk is that a lower price becomes the whole message, said Alison Schilling, a managing director at L.E.K. Consulting. 

"You can't just drop prices and expect everyone to come running," she said. L.E.K.'s playbook, "The End of Price-Led Growth," argues the goal is not to be the cheapest option but to feel like "the smartest purchase."

That means telling a bigger story than the price. Schilling said diners across income levels ask the same two questions: "Does it taste good, and was it worth what I paid?" Taste, she noted, carries roughly twice the weight of any other factor in L.E.K.'s research. The strongest brand messages bundle price with portion, quality, and experience. L.E.K. credits Chili's comeback to competitive pricing paired with "sharper communication" and menu clarity, not just indiscriminate discounting.

"Customer value is not a cheaper sandwich," said Abigail Pringle, a former president of Wendy's US who now advises L.E.K. "It is total confidence that the meal, the experience, and the convenience made it worth the spend."

The gateway to quality offerings

Even the biggest players have continued to hedge. PepsiCo is pairing lower prices with product news, including protein Doritos and Lay's made with avocado or olive oil. McDonald's promotes pricier limited-time burgers like the Big Arch alongside its deals. 

As meal deals, discounts, and promotions become increasingly ubiquitous, companies need to make a more compelling case for quality to stand out and attract customers. Emphasizing quality also creates opportunities to upsell shoppers who are willing to pay more for a superior product.

Tone matters too. Asked how brands should talk to consumers while costs stay unsettled, the experts counseled candor: Acknowledge that this is not a normal economy, then show what the brand offers right now. 

Pringle urged marketers to start from why the brand exists and what its core products are, rather than chasing every promotion. Focusing messaging on product attributes rather than cost can help marketers build a stronger case for why shoppers should choose their products over competitors’. 

Marketers are also learning to speak to different wallets. Blanket offers, Schilling said, rarely address specific consumer segments. Loyalty programs let brands get more specific, such as offering a free cookie instead of a free small fry to a customer known to prefer sweets. 

• Axios reported that lower-income fast-food traffic fell nearly double digits while higher-income visits rose. 
• According to Circana data cited by L.E.K., 54% of households under $75,000 would dine out more often if prices were better, so the lower-income customer is well worth the effort.

Analyzing pricing promotions

As consumers' wallets continue to feel the squeeze, marketers and retailers face a question of sustainability. 

“Is this a promotion that is short-lived? That is only there to drive a certain traffic? Can it be sustainable?” Pringle said. “I think the question you have to look at across brands is did they have to re-engineer their operating model to be able to support it, or is this a short-lived promotion that is just trying to get them by.”

Data, though, has to give something back. Customers will share it, Schilling said, if they're rewarded for frequency and engagement. Pringle cautioned that the weakest programs "teach customers to wait for the next coupon."

For brands, the takeaway is that affordability shouldn't be the only hook. A price cut gets attention, but if brands want to pull ahead, they should back it with food people can savor, offers that feel made for them, and an operation that can sustain the promise once the campaign ends. 

Economic uncertainty won’t last forever, and brands that play the long game can hold on to customers through inflationary stretches and keep them coming back after that pressure eases. Executed properly, that’s how a brand can tell stretched shoppers it understands their budgets without ever sounding like a bargain bin.

This was originally featured in the EMARKETER Daily newsletter. For more marketing insights, statistics, and trends, subscribe here.