Consumers too scared to spend ?

frugalconsumerThe Great Recession officially began in December 2007 and ended in June 2009, making the upcoming release of December 2013 employment and unemployment data the six-year anniversary of the Great Recession’s beginning and the four-and-a-half-year anniversary of its .  Worse, the indicators that really matter to the living standards of the vast majority of working-age households—jobs and wages—have seen agonizingly slow progress toward full recovery

As marketers, it’s our job to have a pulse on consumer attitudes that could influence their behavior.  We can’t keep looking for “the light at the end of the tunnel”; we have to ensure our marketing adapts to the new frugal consumer.

Here are some sobering facts about our economy..

  • The total “jobs gap”—the number of jobs needed to return the U.S. economy to pre-recession health—is 7.9 mil- lion jobs (3.6 million for women and 4.3 million for men).
  • At 200,000 jobs per month, pre-recession labor market conditions would not be regained for another five years. To regain pre-recession labor market conditions in two years, we would need to add 400,000 jobs per month.
  • Most of the improvement in the unemployment rate since its peak of 10.0 percent in the fall of 2009 has not been driven by increased employment, but rather by potential workers dropping out of, or never entering, the labor force because job opportunities are so weak.  If all of these missing workers were actively seeking work, the unemployment rate would be 10.3 percent instead of 7.0 percent.
  • Workers with jobs are also doing much poorer than they would be if job opportunities were plentiful. This is because when the labor market is weak, employers do not have to pay substantial wage increases to get and keep the workers they need. In today’s weak recovery, real wages have dropped for the entire bottom 90 percent of workers.

images

  • Because today’s weak job growth is due to businesses not seeing demand for goods and services rise rapidly enough to necessitate increased hiring, the economy needs policies that will stimulate demand.

Source: ECONOMIC POLICY INSTITUTE

So what does this mean ?

1ne:  It means that marketing, and branding, are more important than ever.  Consumers don’t just purchase products based on price alone hey purchase your brand experience.  It’s more essential than ever to ensure you deliver a great brand experience.
2wo: Know your target market. Even with this poor economic news there are demographics that are doing well.  Bentley, for example, just had one of their best years ever in selling the ultra luxury car to upscale consumers.  Why compete on price if you don’t need to ?
Unknown-1
3hree: The Holy Grail of market share leader may not be as desirable as profitable leader.  Apple sells less PC’s than other brands, but makes more per unit because they are a strong brand.
4our:  Some products, like cars and electronics, warrant heavy investment in social media because consumers are going to spend a lot of time researching those products before purchasing.  However a lot of other products, like those stocked by grocers, are not products that consumers are going to spend a lot of time on researching.  Understand the moment of impact and how you can turn a consumer into a customer.
This economic news is driving new consumer behavior and we need to continually change an adapt our marketing to ensure it stays relevant to consumers who may be afraid to spend.

About richmeyer

Rich is a passionate marketer who is able to quickly understand what turns a prospect into a customer. He challenges the status quo and always asks "what can we do better"? He knows how to take analytics and turn them into opportunities and he is a great communicator.

View all posts by richmeyer →

2 Comments on “Consumers too scared to spend ?”

  1. Great post. Now more than ever marketers and strategists need to know their customers. Whenever possible companies need to provide solutions for their customers, not just products.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.