The financial meltdown is showing signs of abating, but the frugal spending habits many developed in response during the course of 2009 are likely to have more staying power, according to a new survey from PricewaterhouseCoopers LLP (PwC) and Retail Forward, a Kantar Retail company.
“The recession has tempered the rampant and excessive consumption, giving way to more mindful choices as shoppers increasingly seek out online and mobile coupons, comparison shopping sites, and loyalty and rewards programs,” said Lisa Feigen Dugal, PricewaterhouseCoopers U.S. retail and consumer practice leader. “As consumers become more invested with using these tools in their shopping experience, retailers will need to adapt their strategies to appeal to this new generation of consumers.”
The study suggests that at least the “rampant deal-seeking” that characterized much of 2009 will slow down, but new shopping tools put into use will continue to be used.
The affluent segments of the younger demos, including those in the groups known as Generation X and Generation Y are predicted to lead spending as the economy continues to right itself. They will feed their expectation for instant gratification, and will proceed into the market with less debt and a less-urgent sense of the need to accumulate wealth.
Baby boomers, on the other hand, are said to have fueled the last two recession exits, but this time they were hit hard just as they are looking seriously at retirement needs. They are not expected to drive spending.
The report suggests, “[R]etailers need to make promotion and savings-related information more easily accessible across all shopper touch points. Furthermore, the explosion of online resources and new mobile phone shopping apps has made it easier than ever for consumers to find a specific item. This makes it imperative for retailers and manufacturers to optimize their search engine and paid search vehicle activities.”
Feigen Dugal added, “Retailers and suppliers must realize that there will not be a wholesale return to previous shopping patterns and behaviors. To succeed during the recovery, they will need to recognize that some shopper segments will still be in a ‘recession’ shopping mode. They must make sure consumer wants are aligned with the marketplace and turn more ‘need to have’ desires into the ‘must have’ needs of Gen X and Gen Y shoppers.”
RBR-TVBR observation: It will be more important than ever for businesses to market efficiently to consumers in the likely buyer pool. Broadcasters need to be aware of which consumers they can deliver, and when, pair them up with the appropriate categories, and get out there and sell the access as forcefully as possible.