trends: consumerism
and even low-ticket markets have been impacted.
The new ‘normal’
By Pippa Goodman
Pippa Goodman is the Retail Account Director at the Future Foundation, a leading consumer and business trends think-tank. Here she discusses the shapes of the post-recession trendscape and how you can seize the opportuni- ties it holds.
A
ll trends-analysts love a recession. A period of eco- nomic dilapidation creates a perhaps once-in-a-generation chance to explore how much of consumer behaviour is contingent upon year-on-year income growth. How much, we might ask, do the British really care about, say, the ethics of the supply chain or the threat of global warming when unemployment stretches well be- yond two million? What happens to their agenda of weekly treats (the new dress, the gourmet ready- meal, the evening chardonnay) when the instinct to save serious money is revived? How much extra focus falls on the connection be- tween price and quality when nervous customers take to the high street in search of groceries, mobile phones or fragrances? And when downturn turns finally to upturn, just how blue are the bruises that consumers carry forward with them? What is enduring and what is evanescent in the way we have just lived, after the credit crunch and all that bad news from the last years of the previous decade? We reference here what we have come to call ‘the New Nor- mal’. By this we mean the particular post-recessionary inter- action of all those influences on market-place choice. To explore all this thoroughly is to equip our- selves, as commercial strategists, communicators, marketers and
salespeople, with a sharper insight into how to build customer loyalty and make new friends. Take environmentalism. Our re-
search shows that the eco-sensitivities of the average British consumer re- mained really quite resilient across the recession. When the Future Foundation asked consumers in face- to-face interviews in Spring 2007 whether they were “personally con- cerned” about what they could do to help the environment we found that around 70 per cent agreed; by late 2009, with consumer confidence still badly scarred, the figure had hardly budged. Throughout the downturn, a similar percentage agreed that
us that they were still extensively “shopping around” in search of good deals, even more so than they were six months before. In fact, one of the major features of modern times, which the Future Foundation has identified, is the rise in what we call professionalised household budg- eting: millions of families using all the means at their disposal to scrutinise prices, locate recommendations from friends and strangers alike and make sharper purchasing decisions. We have even found that around a third of people in, say, the family forma- tion group actually admit to enjoying the business of sticking to a tight budget. Managing one’s money in
“We explored the mentality of female consumers shopping for cosmetics and found that the impulse to exploit special offers has become more prominent than the instinct to buy brands from habit.”
companies who failed to care for eco-system “should be penalised”. One takes the sense that anxieties about issues such as waste, pollution and carbon emissions are now so culturally ingrained that even an eco- nomic slump more savage in scale than anything our grandparents had to endure cannot blow them out of the marketplace. Worries about the planet remain a crucial point of dia- logue between brands and consumers everywhere.
But, of course, shoppers did adjust their behaviour in a number of very direct, market-influencing ways. Even by late 2009, some 50 per cent of our survey respondents were telling
clever ways has become very pro-am; we can all be ‘financial masterchefs’. More generally, there is little doubt that the recession stimulated much more maximising behaviour on the part of consumers; by this we mean that the search for ex- actly-the-product-I-want grew at the expense of this-product will-suf- fice. When we specifically explored the mentality of female consumers as they go shopping for cosmetics these days, we found that the im- pulse to exploit special offers or voucher options has become more prominent than the instinct to buy brands from habit without explor- ing alternatives. Even indulgence
One of the strange aspects to all this is that average weekly earnings in the UK did not really decline dur- ing the recession (the figure is now creeping well beyond £600). And the benefit of low interest rates and generally low prices rises swept through a troubled economy like balm on cracked lips. It somehow seems right to argue that so much of a recession’s impact is psychologi- cal; it leaves the consumer-citizen intimidated even though his/her fi- nancial situation might remain really quite robust. We live in an economy, after all, in which the total value of disposable incomes doubles in real terms with every generation that passes. It would take a truly seismic macro-economic event to stall such a growth-engine for any great length of time. But there is no doubt that this par-
ticular recession has left some rather raw red scars on the consuming body politic. And the retail community has to expect that the increase in max- imising behaviour aforementioned will still be detectable even when economic growth re-stabilises in the British economy (to the tune of, say, more than 2.5 per cent per annum). Should we anticipate an explosion of consumerist hedonism when the country realises that the credit crunch and its gruesome aftermath are well and truly behind us? Should brand- owners assume that customers, especially middle-class professionals sitting on ever appreciating property assets, will become less price sensitive when they buy fashions, kitchenware or soft furnishings as recovery takes root? We rather think not. And no- tice how the phrase ‘conspicuous consumption’ is heard less often, how it seems less pointed as a de- scriptor of human motive. Only 20 per cent of British consumers now say out loud that they like to “own things that nobody else owns”. Moreover, many people learned new coping skills during the reces- sion; they brought more discipline and purpose into how they bought things; they opened themselves to new ideas. Our research shows that around a quarter of under-24s in the UK now say that they are interested in renting, say, luxury items such as designer fashion and handbags as much as owning them outright. The New Normal, therefore, becomes a fascinating blend of pre-downturn attitudes, heavily influenced as they had been by around 12 consecutive years of consistently positive income growth, and the crude realisation that bad times have to mean ad- justed behaviour in order to keep the present more bearable and the future more secure. ■
www.futurefoundation.net
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