Companies Target European Poor With Third World Marketing

Companies Target European Poor With Third World Marketing

Three years into the global financial crisis, multinational companies that had made huge profits during the consumer boom that preceded it faced a major dilemma: people were no longer buying the expensive premium products that once sold well in Europe.

That was the complaint from the chief of Unilever’s [ULVR-LN  2292.00  ---  UNCH    ] European operations, Jan Zijderveld, who told the German edition of the Financial Times last August that “poverty has returned to Europe.”

His plan to tackle the challenge was for the world’s third-largest consumer goods company, which owns such brands as Flora margarine and Persil laundry detergent, to market its products as if to customers in Third World countries.

The company would sell more laundry detergent to cash-strapped consumers by offering smaller, cheaper packages, a strategy long employed in Asian countries such as Indonesia, where average monthly wages are less than $400.

In Greece, the country hardest hit by the crisis affecting the euro single currency, Unilever now offers mashed potatoes and mayonnaise in small bargain packages, and markets tea, olive oil and other basic products under cheaper generic brand labels.

Others are also adjusting their strategies.

Cut-price “austerity” menus are now common in restaurants across Europe. In France, elite chef Alain Ducasse is trying to entice the masses with a “buy one, get one free” deal in 1,000 participating restaurants, some with Michelin stars.