Barry Clark, of Future Foundation, delivered a thought provoking lecture on the changing consumer landscape at the Financial Services Forum's (FSF) absolutely superb General Insurance Summit.
New behaviours and attitudes are being shaped by the last two years, that he categorised into seven trends that marketers need to take into account in the shaping of strategy, innovation, propositions and communication strategies. Here we review four:
The first is Living Lite, caused by a sense of rising clutter, the war on waste, gathering environmental concerns within middle England, greater awareness of recycling and an entrepreneurial approach to finding new value in old goods.
Trends this is informing include renting vs purchasing, a return to the Radio Rentals model. Owned by Thorn, its Australasian offshoot today rents completely new categories of good, proclaiming on its website 'join the rental revolution'.
The second is a return to professional budgeting. With a middle class squeeze caused by rising education costs and tax, tighter personal budgets are informing budgeting behaviour.
A return to maximising describes behaviour when consumers are scrutinising offers more carefully, resarching as much as possible pre purchasing decision, searching independent views and consulting friends (in today's society substantially aided by user generated content online). As the Chartered Institute of Marketing (CIM) puts it, today we place more trust in the collective voice of complete strangers than we do in the individual opinions of close family and friends.
Clark's next trend is the rise of the discount and free society, enabled by advertising supported economic models, spanning free films, music and information content. In conjunction with maximising behaviour, you might reasonably conclude that this change lies behind the rise of the thriving 99p chain stores.
Yet I would challenge whether this trend is likely to endure. Consumers are getting used to spending money and recognising value differently, as micro-payments. As a result, online music sales are rising (now entirely compensating for offline declines), premium publisher content is being increasingly charged for successfully, and whilst ad-supported models will no doubt continue to flourish, we should take care not to overestimate the strength and singularity of the free services movement.
This is all very well, but will behaviours change with a future return to economic prosperity? The answer is probably yes and no, due to environmental and related attitudinal factors counterbalancing economic ones. In the meantime, the West is quite likely to experience several years of extremely low growth and further declines - at least 5 more years - due to lower levels of large-scale investment as we slowly but surely deleverage. As The Economist explains, it's barely begun.The reasons why we'll discuss separately, along with the opportunities this presents firms that drive efficiencies and better organisational integration.
