Transformers - Colloquy

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C O L L O Q U Y / Volume 18, Issue 1, 2010
The Consumer Comes of Age
A Context-Based Research Group study finds that the recession is changing not only spending but also consumer
self-image with “the potential to maintain a healthy balance between our consumer and non-consumer sense of selves.”
Has taken steps to reduce spending this year 88%
Feels economic changes affected life positively 43%
Has made permanent changes in spending 83%
Seeking small treats for self and others 90%
Seeking luxury for less 62%
Spending has become more strategic 93%
Spending as much or more, but differently 43%
Loyalty marketers can take these
research results and make sure their
efforts, whether through a traditional
loyalty program or through other
enterprise loyalty tactics, line up with
the statistics. After all, according to
Fordham University’s Lerzan Aksoy,
brand loyalty is already facing
challenges as price-challenged
customers consider switching to more
affordable brands. But in addition,
these statistics also shine a light
on the consumer shift from simply
acquiring tangible things to focusing
on experiences—spending a larger
portion of dwindling dollars on
experiences that can be enjoyed with
other people.
Making experiences attainable
Loyalty marketers who can strate -
gically respond to this new consumer
focus on experiences may find
renewed success and increased
loyalty, Aksoy says. “For example, a
drinks manufacturer recently came
up with displays to teach people to
mix cocktails at home rather than
go out to a bar,” she says. “Instead
of reducing their prices, they were
able to market in a way that helped
preserve their customer’s standard
of life at an affordable price.”
Robert Leone points out that loyalty
programs that offer a special
experience or something beyond a
discount makes people believe they
are getting more bang for their buck
as they choose their purchases wisely
and carefully. “They’re stretching and
shifting their choice sets—so, for
• Source: Coming of Age in the Great Recession: A Grounded Consumer Followup,
Carton Donofrio Partners, Context-Based Research Group
• Survey participants: 1,000 U.S. adults nationwide (age 18+); sample balanced to
ensure gender, income, race, age, and region representation
example, they might pick a different
family vacation if one offers some
value-added component.”
If not a family vacation, then maybe
a chance to win a professional family
photo, as offered by the Huggies’
Enjoy the Ride program. Or something
personally fulfilling like private
cooking lessons or thrilling like the
“fighter pilot experience” offered by
the choiceprivileges program from
Choice Hotels. Or something relaxing,
as simple as Optimum Rewards’ “Meal
and a Movie” discounts to share with
a loved one.
For Robbie Blinkoff, the new
thinking is all about the ‘grounded
consumer’—who is more strategic
and more thoughtful, who thinks
about the social and the emotional
as well as the rational point of
purchasing. “They think about Value
with a capital V,” he says. “This is
definitely a post-recession
consumer—83% of the consumers
we studied said they are spending
differently, really thinking through
their purchases. Even if some of those
people are saying one thing and will
behave differently, it’s still a big
difference. What may come out of this
a couple of years from now is that
people will be spending a lot of money
but on less stuff, because they’ll have
a very clear sense of what products
they want in their life.”
The products and services consumers
will welcome, say experts, certainly
depend on a company’s category,
its target audience, and its customers’
level of price sensitivity. However,
experts say offers also require new
thinking by loyalty marketers as they
negotiate a changing consumer
mindset.
“You have to think holistically about
your customer offering,” says Leone.
“Even as we move toward an upswing,
people have changed the way they
think—they have learned that there
is value in reconsidering and
reevaluating what they purchase.”
Because brand stickiness can no
longer be counted on, marketers must
offer a strong motivator to buy, he
says, whether an economic motivator
such as double points, lower prices or
delivery options, or a psychological
motivator, such as a sense of
experiential value when redeeming
rewards.
The crux of all this, explains Blinkoff,
is that the new post-recession
consumer doesn’t think of himself
or herself as one, requiring a new
approach from marketers of all
stripes. “We believe retailers must
gently nurture customers rather
than aggressively targeting them as
they may have in past years,” he
says. “To see the world right now
through a marketer’s eyes with
only those lenses is a professional
problem right now.”
Sharon M. Goldman is Senior Editor,
COLLOQUY. We didn’t pay her salary for the
time she spent writing this article. It’s the
new frugality, after all.