To put it another way, “it’s all about the economy stupid!”.
Cheap Treats – In these sober economic times, cheap treats are where it’s at. But how is this manifesting itself? We know that daily deal sites like Groupon and others are having a hard time. But cheap treats aren’t the same as ‘cheap deals’.
Cheap treats are about the expectations people have, and about how these are met. For consumers this is less about trading down, than perhaps trading across and within categories. For example if the horsemeat scandal affected the way you shop, you might decide to make the switch thus: instead of a one-stop-shop at Tesco you might choose to buy the treats on your shopping list from Waitrose and the rest from Lidl or Aldi and in this way spend the same amount as you did before.
Cult of the Home – Unlike the obsession with interior design which defined the economic boom times of the 80s and early 2000’s, we are now seeing a cult of the home based on the development of craft skills. Think about it, pensions are weakening, children are staying at home longer especially as higher education and property become less affordable. Teenage bedrooms are morphing into adult studio apartments and this has inevitably led to a boom time for charity shops as the second-hand furniture they sell gets snapped up, repainted and remodelled. The trend towards ‘vintage’ also reflects this new reality.
‘Ish’ (or re-appraising commitment) – With less money we are all questioning why we are tied into tariffs from, say, high-priced energy / mobile / insurance / broadband suppliers. Any why not? It’s no surprise that publications like the consumer champion ‘Which?’ are experiencing booming subscriptions. People are shopping savvy across the board. Brands beware.
Sober times – Austerity breeds sobriety, why splurge on a pricey night out supping cocktails? Instead, you could host a party and invite people to bring the ingredients – and people are. But at a deeper level, people are also starting to question why they should have an ‘excessively’ good time, and what that costs in ways other than financially – health is becoming an issue, a reflection of an ageing population less suited to excessive living.
Native Marketing – Brands (at least the clever ones) have grasped that the means by which people interact with brands has changed. That sounds like real agency speak – but it means something. Think of it this way. You encounter an event in your city – say, a gig or concert in a well-known public space, free of any charge and sponsored by a brand. Later you see a website related to the event which features exclusive content from artists performing at that show. You might decide to sign-up to receive VIP tickets (again, free of charge) from that brand as a result, or updates on the go to your mobile. That is native marketing – it’s about marketing in places and in ways that people will accept happily and without coercion.
The professional consumer – Austerity has driven consumers’ need to save money (see Cheap Treats above). There are apps galore enabling you to save money – from scanning barcodes on products to identify where you can get them cheapest to full-blown price comparison and cashback services. Like never before we are equipped to be smart consumers.
The next generation – There may be less of them than, say, people in their 40s, but they are here and we need them to provide for all our pension pots (see ‘The ageless society’ below). As Generation Y’s moves into the workplace run up against their expectations, often disappointingly, and where they face the twin pressures of paying off higher education debt and not being able to afford their own homes, we are seeing seismic shifts in the way people work. I know of many friends who combine full-time working with freelance work, a means to earn more, pay off debts and maybe, just maybe, save for that elusive pension. In the case Generation Y we are seeing a growing recognition that the state is not the provider of first resort and that business model thinking is what’s needed to run their lives.
Buying local – Not only is there seemingly widespread disillusionment with the EU developing in parts of the UK, there is also a trend towards buying local and traceability. These trends have been exacerbated, in part, by scandals around food quality. Buying locally is also seen as doing the local economy a favour, and a reaction against globalisation which is perceived as having brought ill winds. This is a normal human reaction, if not necessarily a reasoned one. There is room for both globalisation and localism in my personal view – but that is a separate discussion.
Graphene Nation – 3D printing was talked about a few years ago but mainly in nebulous terms – it wouldn’t ever become a reality for consumers would it? It has. Consumers can now design their own products and prototypes. Who needs brands?
The ageless society – No, not the nirvana dreamed of by image obsessed celebrities, but the reality of our lives. We are ageless because we have to be. We are working, and will have to work, beyond traditional retirement ages. Pensions will not pay out what was promised so we will be drawing down from legacy assets (which will deplete) as well as drawing up finance from younger family members.
Austerity will shape the way we live not just for the next five years, but for ever more. It is fundamentally altering the shift between what the state will provide and what our expectations are. It’s all about the economy stupid.
Sanjit Chudha 