Possibly a lot.
And the answer just might be in two directions simultaneously: up and down.
The Wall Street Journal recently reported (subscription required) about how the salad dressing market is a good indicator of how many markets in the U.S. economy are bifurcating – splitting into a discount market catering to lower income consumers and a premium market catering to the wealthy.
The middle, where you find the most popular brands, is getting squeezed as hard as an almost empty bottle of ketchup.
In the dressing world, the low end is represented by private-label/supermarket brands, while the high-end is represented by fresh and organic dressings and more upscale or exotic flavors.
Premium dressings that you find on refrigerated shelves near the produce section of the grocery store are growing two to three times faster than the regular brands.
If you’re one of our business web hosting customers trying to grow your business online, you might want to think about this up/down market bifurcation and how it may or may not be affecting your business.
Are you well positioned to appeal to the cost-conscious consumers looking to pinch pennies and cut corners? Are you positioned as a premium product or service provider able to command premium pricing? Do you offer options to appeal to both segments?
If not, you may be able to use your web site to test out some alternate products that appeal to either the high or low end of your market, or both.
For example, you might test offering product or service discounts through search engine marketing with Google Adwords (see our previous blog post about getting started with AdWords).
If you can’t (or don’t want to compete on price), you may want to see if you can put together a more premium package that you try to upsell to current customers via email marketing (our previous posts about getting started with email marketing and tracking your email marketing results can help you with that).
See how you can innovate with your product or service (or your marketing) to set it apart from the shrinking middle and help you generate increased growth and higher margins.
Good luck. And let us know how you’re doing.