Not unlike WPP Group CEO Martin Sorrell’s “less worse” assessment of the 2010 advertising marketplace, consumers are less anxious about the recession but remain cautious about how they spend their money, according to a new global survey from The Boston Consulting Group.
The anxiety levels are highest in Spain, Mexico and Japan, and more than half of the respondents in India, the United States and France remain worried about the future. The percentages, however, declined from a year ago. Fifty-four percent of the U.S. respondents, for example, characterized themselves as anxious — down from 63 percent last spring but still above the pre-recession level of 42 percent in the spring of 2007, BCG said.
In a summary of the survey, “A New World Order of Consumption: Consumers in a Turbulent Recovery,” BCG concludes that businesses should regularly rethink product pricing and sharpen their in-store marketing efforts. Additionally, BCG suggests that marketers “accelerate product innovations that feature quality and craftsmanship” in categories such as health and wellness, home furnishings, appliances and electronics.
Those categories remain appealing to “cocooning” consumers who, amid the economic turmoil, continue to turn to their homes for comfort — a trend that BCG expects to endure beyond the recession. “Anxiety about the future and mistrust of big business have triggered a ‘back-to-basics’ movement in which consumers continue to rank home, family, stability and the environment high on their list of values,” BCG explained in the summary.
A consumer shift toward value or private-label brands is another trend that BCG predicts will continue. More than 40 percent of the survey respondents in the U.S., Europe and Japan said they would keep buying private-label goods even as the recession recedes. In Spain, that figure reached 57 percent.
Based on geographical variations in its findings, BCG projects a “multispeed recovery” in which countries like China, Brazil and India recover faster than mature markets like the U.S. and Europe. “Companies face a new world order of consumption,” said Catherine Roche, a partner at BCG in Dusseldorf, Germany, and co-author of the survey. “It will require them to rethink their growth expectations and develop a highly de-averaged approach.”
Consumer research also will be critical to developing marketing strategies, given economic and emotional ups and downs across and within geographical regions, according to BCG. Indeed, during its polling in March and April, BCG traced some anxiety among German consumers to the insolvency crisis in fellow European Union country Greece. More recently, the massive oil leak in the Gulf of Mexico has contributed to consumer distrust of big business, Roche acknowledged.
“This downturn really has been a roller-coaster ride for consumers,” she said.
More than 12,000 consumers in 14 countries took part in BCG’s survey, which the business consultancy conducted both online and offline. The number of questions ranged from 58 to 62, depending on the country, a BCG representative said.
See also: “From ‘Green Shoots’ to ‘Double Dip'”