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When 'good enough' is, well, good enough

When 'good enough' is, well, good enough

Jerry is the Retail lead in the Commonwealth Bank’s Business and Private Banking division where he harnesses and develops the bank’s resources for the benefit of its retail clients. He is well-known for delivering thought-leadership, insights and analysis that help retailers succeed.

I recently found, tucked away in an old photo album, a picture from my university years. I looked terrible. Or rather, my clothes did. The trousers were slung low, unintentionally and way before it was a thing, and the sleeves of the t-shirt were strangely out of proportion to the body. The material did not say 'quality'. From the self-conscious look on my face, all of this is dawning on me. Shortly afterwards I gave myself over to the certainty of 'the brand'.

And there I've remained, safe in the shorthand knowledge that, by paying more for brand-name goods, I am buying quality and saving myself from the niggling doubt that I look as poorly dressed as I did in that photo. Until recently.

Over the intervening years design has improved, textile technology has come on leaps and bounds, supply chains have shortened and become more certain. Clothes that are 'good enough' can now be found in our shopping centres at a fraction of the price charged by the brands I've relied on until now. I've started buying 'good enough' clothes, at least for staple purchases.

And it's not just in clothing that this trend towards 'good enough' has been felt. Improvements have been made in areas as diverse as homewares and consumer electronics.

‘Good enough’ has fuelled the rise of off price retailers such as TK Maxx - why pay full price when you can find things that, whilst not selling out in boutiques, are still 'good enough'.  It's behind own-brand foods and clothing too. We are becoming accustomed to buying some own brand as part of our weekly shop. Aldi, for example, is a store built on own-brand and ‘good enough’.

Ignoring this trend can be fatal. Look at Howard's Storage World, famously selling expensive waste bins when you could get one that is 'good enough' at a fraction of the price elsewhere. Pumpkin Patch continued to sell expensive baby clothes way after the high street started selling 'good enough' copies.

‘Good enough’ doesn’t apply to everything. It’s most applicable to staples or items that don’t have a strong emotional content to them. Batteries. Lightbulbs. Tomato Sauce. When we are looking for something that truly represents us, ‘good enough’ isn’t, well, good enough. That signature piece of clothing needs to be just right. Luxury will always have a place. If you are a foodie, fresh food will need to be just right.

When a product sits in a category where we are happy to accept ‘good enough’, the focus moves to price. We are no longer happy to accept a premium for the shorthand that a brand name provides. Online has made it easier for us to find the lowest priced ‘good enough’ products. Amazon will make this even easier.

Ignoring the ‘good enough’ trend can leave you open to competitors taking these unemotional, price-driven sales from you. Is your offer good enough to withstand the ‘good enough’ trend?

For more information on our Retail Insights visit commbank.com.au/retailinsights

Head of Retail

Jerry is the Retail lead in the Commonwealth Bank’s Business and Private Banking division where he harnesses and develops the bank’s resources for the benefit of its retail clients. He is well-known for delivering thought-leadership, insights and analysis that help retailers succeed.

Things you should know: This blog is published solely for information purposes. As this blog has been prepared without considering your objectives, financial situation or needs, you should, before acting on the information in this blog, consider its appropriateness to your circumstances and if necessary seek the appropriate professional advice. Any opinions, views of contributors, conclusions or recommendations are reasonably held or made, based on the information available at the time of the blog. Compilation, but no representation or warranty, either expressed or implied, is made or provided as to the accuracy, reliability or completeness of any statement made in this blog. Commonwealth Bank of Australia ABN 48 123 123 124 AFSL and Australian credit licence 234 945.