Retailers Target Low-Income Consumers with $10 and Under Gifts

As the global economy faces headwinds, retailers are increasingly focusing on low-income consumers, with a growing interest in affordable gifts under $10. This shift is driven by the growing awareness of the purchasing power of low-income consumers and the need to cater to their budget constraints. According to a study by the World Bank, 63% of the world's population lives on less than $10 a day, presenting a significant market opportunity for retailers.

To effectively reach this segment, retailers are adapting their distribution and marketing strategies. A study by the World Bank identified 13 approaches, including cost structure changes, product and packaging modifications, and distribution channel innovations (Source 1). Another study found that consumer aspirations, region-based versioning, visible packaging, and product demonstrations are critical factors for adoption by low-income consumers (Source 2). By understanding and addressing these factors, retailers can enhance the acceptability, awareness, availability, and affordability of their products, ultimately driving low-income consumer adoption and firm introduction of new products in emerging markets.



However, retailers targeting low-income consumers with $10 and under gifts face a challenge in balancing affordability with product quality and value. According to a study by Rao and Siebert (2023), while strategies such as changing cost structures, using cheaper ingredients, and offering single-serving packaging can make products more affordable, they may compromise product quality and value. A multi-method study by Rao and Siebert (2019) identified critical factors for low-income consumer adoption, including consumer aspirations, visible packaging, and product demonstrations. By focusing on these factors, retailers can enhance the acceptability, awareness, availability, and affordability of their products without sacrificing quality and value.



Product packaging and presentation play a crucial role in enhancing the appeal of affordable gifts to low-income consumers. According to a study by the World Bank, low-income consumers are more likely to purchase products with visible packaging and clear branding (Source: Number 2, URL: https://link.springer.com/article/10.1007/s11747-019-00648-8). This is because they often rely on visual cues to make purchasing decisions, as they may have limited access to information or literacy challenges. Additionally, packaging that highlights the product's value and quality can make low-income consumers feel they are getting a good deal, even if the price is low. Furthermore, innovative packaging designs can make affordable gifts more appealing and gift-worthy, increasing their desirability among low-income consumers.

In conclusion, retailers are increasingly targeting low-income consumers with gifts priced at $10 and under, aiming to tap into this underserved market. This shift is driven by the growing awareness of the purchasing power of low-income consumers and the need to cater to their budget constraints. By offering affordable gifts, retailers can enhance the accessibility and affordability of high-quality products for this segment. However, it is crucial to consider the potential impact of these strategies on the overall market and consumer behavior. As retailers focus on low-priced items, there may be a risk of devaluing the perception of higher-priced products, potentially leading to a shift in consumer expectations. Additionally, the success of these strategies depends on the effectiveness of marketing and distribution channels in reaching low-income consumers. By understanding and addressing the unique needs and preferences of this demographic, retailers can effectively tap into this market and drive growth.