Friday, 01 April 2011 10:10

Consumers' Changes

As a marketer, one of your job priorities is to understand your target consumer. We all noticed some changes during the recent economic recession. Many consumers switched to private labels from name brands, picked up the old standby of budgeting by using a shopping list, and many consumers started to save today and buy tomorrow rather than putting it on a credit card.

Now although officials claim that the worst part of the recession is already over, the question for marketers remains as to whether these buying preferences will switch back to those from before the recession. Today FiG is going to discuss several changes and the possible trends of overall consumer purchasing behaviors and purchasing decision-making that we have discovered.

  1. Consumer confidence continues to fluctuate in a weak economic recovery. Most consumers still feel the effects of this difficult economy, and many of them claim to save more money than the year before. While increased budgeting is prevalent across all demographic groups, women, younger adults, those with lower household incomes, and African American and Hispanic consumers are the most likely to say they are budgeting more.  However, budgeting and saving is not only about money, it's also saving energy and time. Shoppers are re-evaluating the benefits vs. costs, and more efficient and/or green lifestyles are considered to be a long-term saving strategies despite the usually higher prices that need to be paid upfront. Besides high quality, ease of use and satisfying post-purchase service still rank high in terms of the influences that lead shoppers to purchasing decisions.

  2. Consumers spend more time on pre-purchase research. Compared to before the economic recession, today's consumers spend more time researching products on-line and in store and consulting friends & families. According to a shopper marketing report by Integer Group and M/A/R/C Research, consumers are researching for the "best" instead of the "cheapest" products.  Convenience and value  reign as consumers' top criteria for shopping selection. To marketers this means that your marketing communication should start way before the moment that your consumers are in the store. The ability to provide exactly what consumers are looking for becomes more and more crucial to the growth of a business. Think about your recent purchasing experiences; in in the past several months have you gone to a store to purchase a specific item but walked away without buying?  What was your main reason that you walked away? What would be the main reason for your clients that have walked away?

  3. On-line shopping recovers from a decline. Even though consumers still feel the pressure of the recession, internet retailing started to recovered from an initial recession based decline and already shows new growth. According to the Commerce Department, E-commerce sales rose 14.8% in 2010 compared with 2009.  Although the speed of growth will slow down to 11.3% in 2012, 9.7% in 2013, 8.7% in 2014 and 8.1% in 2015, the research firm eMarketer estimates "e-commerce sales will increase 13.7% this year, with sales—excluding travel, digital downloads and event tickets—totaling $188.1 billion." This growth is mainly due to the increase of Internet access, improved security technology, and consumer-centric marketing.  Marketers should be devoted to Internet marketing to educate consumers about the benefits of the their products and services, leveraging consumer data to improve sales forecasts, consumer research, creating loyalty programs, and recognizing the Internet as a channel of communication and a tool for better customer services.

  4. What's next after the economic recession? Although we cannot predict everything, FiG knows that one of the biggest trends for marketing in the future is consumer-experience oriented marketing (CEOM). What is CEOM? CEOM is the kind of marketing that connects with the consumer's heart and mind. It is not a marketing tool, but a concept and a mindset. While traditional marketing focuses on the product features, benefits, and attributes, CEOM concentrates on consumers' overall shopping experience and their reasons to purchase.

We hope this helped and feel free to ask us any questions you might have.