Famous Brand, a quick-service restaurant and casual dining franchisor in South Africa, has just posted a 14% increase in revenue for the last six months and analysts attributed part of that growth to customers downgrading in a recessionary climate.
"Things are very tough for the fine-dine restaurants, and that could be the reason why (Famous Brands) were ale to grow their business," RMB Asset Management industrial analyst Myuran Rajaratnam told Business Day newspaper.
Famous Brands is not the only brand to benefit from consumers downgrading and, with predictions that many consumers will not return quickly to their old consumption patterns, the outlook for the beneficiary brands is good.
However, this does not mean the brands can take things for granted. Downgrading consumers are looking for value and that must be consistently delivered. Brands will also benefit from appearing to be a little more expensive than they actually are and thereby making making the downgrade a little less obvious for image-conscious consumers.
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