Saturday, 17 January 2009

Captain Crunch

Credit crunch, economic downturn, financial crisis - terms tossed around a lot in the media and at various dinner tables, haunting us like indecipherable shadows, steadily present and noticeable in our peripheral sight.

I've certainly been thinking about the changes that we may witness in the coming years. Like a pile of clothing in a dorm room, once I get through the first layer of thoughts laden with fear, I actually come to some positive conclusions.

Something needed to give. Reckless and rampant spending coupled with consumerism as paradigm of the decade (if not longer) has eroded our environment and quality of life in so many ways.

The professional side of me, the sales person (my profession boiled down to its purest form), worries, but only for a few minutes. Behavior will change, but people will buy products and services embedded with value, meaning, and perhaps a different type of utility.

The possible implications of the dramatic systemic turns and twists (a system configured and set in Bretton Woods (and prior) are deep and varied (depends on how riotous your imagination is...). I've heard people murmur about the end of currency as we know it, or back to barter. A tad drastic perhaps, but one thing is sure - we will witness the onslaught of a huge shift in consumer behavior. Consumers will start reconsidering everything they do/buy/desire.

I believe that several trends will impact people’s routine behavior and choices:

1. The New Frugality: Jobs are no longer secure, house prices are plummeting and consumers are on the prowl for ways to curb their spending. 2009 will usher the dawn of a new era of austerity.

2. Local Movements: The local context will become increasing important to consumers that are looking for bargains, cheap eats, comfort and affordable city leisure and travel activities.

3. Institutional Distrust: Survey evidence from Future Foundation suggests there were high, underlying levels of consumer dissatisfaction. More than 40% of people agreed with the statement “Most companies are not fair to consumers”.

Consumer behavior will shift, but not everyone is going to be simply looking for bargains. People are re-evaluating their values and personal systems and some will find the fun in frugality. People in varying social and political situations will respond differently, with outlook, circumstance and mindset strongly influencing their responses.

But what is the personal impact on our lives right now? How are behaviors changing in the immediate?

Based on an initial review of reactions to market shifts, I've noticed three emerging consumer profiles:

1. Bargain Hunter (Cut-corner Sally): Ordering takeout rather than going to restaurants, Primark and thrift shoppers, taking the family camping in Wales, making lunches for work, basically cutting costs wherever possible.

2. Fun ‘Austeres’: Shopping in their closets, buying like a ‘chef’ – finding basic ingredients and cooking from scratch, turning to green products (boots made from plastic bags), renewed interest in arts & crafts, nights in with friends (wine, board games and home cooked dinners).

3. Frugal Fakers: seeking high style on a low budget. They uncover affordable UK getaways, cheap eats and other budget tips and tricks (home-made masks and facials, half-price lunches at Ramsey’s, taking advantage of high street sales (75% off at Selfridges).

I'm of course, just tossing around some disparate thoughts on deep systemic shifts.

But I'm really curious to know: has your behavior changed? Are you doing anything differently?

No comments:

Post a Comment