Augustin’s passion for his strategy and belief in his vision was backed by his own assumptions rather than data-driven insights and experiments. He dove headfirst into his new strategy, sticking by it as a “revolution” even in the face of declining profits and a negative reaction from customers. His belief in the “hablar claro” approach was based on his past success with Hogar and Xela instead of the current needs of Emilia shoppers, to the extent that he failed to realize that had shifted to competitors who offered discounts. Had he instead tested his assumptions with the Emilia customer base and validated the no-discounts approach prior to deployment, perhaps he would have quickly realized that shoppers did not gravitate his “no gimmicks” messaging. As Yashodhara Shroff highlights in her expert response, Augustin’s inability to adjust his strategy based on responses to tests led to him imposing his vision on unwilling customers. Had he been more flexible in his approach, he perhaps would have decided to roll out a more gradual and less intense version of “hablar claro” – one that could have been easily built upon or swiftly scaled back based on real results with customers.
I would recommend that Augustin scale back and introduce discounts into his strategy while he takes a hard look at how customer responses have changed since the removal of discounts. In doing so, he can understand what parts of the approach they found condescending, why the campaign caused them to seek out competitors, and, perhaps most importantly, how best to move forward. If he is able to unpack what aspects of the campaign customers did respond positively to and/or a customer segment that was drawn to the lack of discounts rather than repelled by it, he could then gradually reintroduce components of his strategy into Emilia stores. Emilia’s future could then be determined not by the whims and experience of one company strategist, but instead the needs and desires of shoppers themselves.
