Ad Week reports that Interpublic Group has completed new research showing that “the recession is having a far greater impact on consumer spending habits than previous downturns, and that some behavior patterns, as well as brand perceptions, will be permanently changed … 75 percent of consumers have altered their purchasing behavior over the past year, in some cases trading down and in others making wholesale lifestyle changes.”
The reason for the greater permanence? The Internet. According to the story, “Consumers have turned more than ever to the Web to seek more information about brands -- from how to stretch household budgets to product reviews-and they're not turning back.”
The report states: “"Consumers are spending more time researching products and gathering opinions from other people before purchasing. As a result, people are thinking more deeply about products, raising huge opportunities for brands to develop and strengthen their relationship with consumers."
Interestingly, USA Today has a story this morning about the impact of the recession on the Millennial generation, or Gen Y, which ranges from people in their 20s to those still in grade school.
According to the story, a new study by JWT suggests that 60 percent of the people surveyed in this age group “feel their generation is being dealt an unfair blow because of the recession. But some see opportunity, as well. For example, 44% say they might be able to afford a house now that home prices have plummeted; 25% say that if they have trouble finding a job, they'll just start their own business.”
The reason for the greater permanence? The Internet. According to the story, “Consumers have turned more than ever to the Web to seek more information about brands -- from how to stretch household budgets to product reviews-and they're not turning back.”
The report states: “"Consumers are spending more time researching products and gathering opinions from other people before purchasing. As a result, people are thinking more deeply about products, raising huge opportunities for brands to develop and strengthen their relationship with consumers."
Interestingly, USA Today has a story this morning about the impact of the recession on the Millennial generation, or Gen Y, which ranges from people in their 20s to those still in grade school.
According to the story, a new study by JWT suggests that 60 percent of the people surveyed in this age group “feel their generation is being dealt an unfair blow because of the recession. But some see opportunity, as well. For example, 44% say they might be able to afford a house now that home prices have plummeted; 25% say that if they have trouble finding a job, they'll just start their own business.”
- KC's View:
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It seems to me that while there is a lot of debate about how the recession is going to shape people’s attitudes and lives, one of the things that is largely being ignored is that the recession may be empowering people to do a better job of shaping their own lives – albeit under somewhat more modest circumstances than they might have just a few years ago.
The empowered consumer may be scary to a lot of retailers and manufacturers, but in fact this can be very good for business – at least, for the businesses that embrace an ongoing conversation with the people who patronize their stores. Sure, consumers are going to be more demanding and more informed, and this raises the bar for business. But when you clear the bar, the connection between store and shopper has the potential to be far more profound and, dare we say it, loyal in both directions.
And that’s good for business.
Except, of course, the businesses that don't get it.
BTW…this sense of empowerment should extend to how people behave while in the educational system, and how they behave as citizens. Which is why educators and governments also have a choice – they can embrace this new reality, nor deny it.
But they deny it as the risk of irrelevance.
