Posts filed under 'consumers'
Trust plus
Will Galgey writes:
Trust in organisations and brands has been declining steadily as consumers have more information and are more sceptical. There’s also striking evidence that attitudes have shifted, certainly in Europe and North America, as a result of the global financial crisis. But if trust isn’t enough, how should companies respond? We’ve been collaborating with Millward Brown, the WPP company which runs the WPP brand equity research programme BrandZ, to try to answer this question.
Our joint research produced new insights into consumer behaviour and attitudes which should help shape the behaviour of companies and their brands, and new metrics to help gauge the effectiveness of these actions. In summary:
- trust is still essential
- but it needs to be combined with customer recommendation to be effective
- which generates the ‘equation’, Trust + Recommendation = Success.
And since both levels of trust and willingness to recommend can be measured in research, the quantitative wizards at Millward Brown have produced an index, the TrustR score, based on global consumer research, which indicates how effective different companies and different brands are in different markets.
There are some surprises in the data – Pampers tops the chart globally (and is also number 1 in the UK, France and Germany), while China Mobile is in the top 10. And Nokia, which tends to get written off by American commentators dazzled by Apple and Google, is top in 8 of the 22 countries covered by the study. The research shows a strong correlation between TrustR scores and brand financial performance.
The good news is that the TrustR report is free to our clients, and comes tailored for specific markets and specific categories. If you are a client, the consultants you usually work with can arrange for a copy to be sent to you. If you’re not a client, and are interested, please email us at betterfutures[AT]thefuturescompany.com, and we’ll see what we can do.
Add comment 12 March 2010
Cautious consumers, building buffers
Andrew Curry writes:
We’ve just published our latest report on the post-recession consumer, and the headlines are that although people are still concerned about the state of the economy, and are behaving cautiously as a result, there is less panic about the economic outlook than was shown in our previous research. But this is partly because people have changed their behaviour – the UK savings rate is now 8% (it was close to zero for most of the last decade, and even negative in 2008). As Futures Company Director Fran Walton said at the client launch, “People are building a buffer for what might lay ahead for them.”
A couple of insights from particular sectors are striking. The first is that people seem to have changed their grocery shopping behaviour – the proportion agreeing that ‘I am shopping at several shops to get the best prices, rather than doing one big shop at the supermarket’ increased from 22% to 36% between January 2009 and November, when the field research was done for the latest report. And there’s evidence that people are looking to spend less when they go out. There’s a more detailed summary of the data in WARC (subscription required).
News of the client launch event turned up in an unlikely place – Claire Myerscough’s Media Week in Brand Republic. She works for News International, and this was her take on the research:
Learn that consumers are still less trusting, with 53% worried about the price of petrol and 43% planning to spend less over the next 12 months. The mood of uncertainty is in line with our research: things have improved since this time last year but we are not out of the woods yet.
The Reconstructed Consumer is available as a paid-for report. For more information please contact Jennifer Childs on 020 7966 1824.
Add comment 19 February 2010
A history through objects in a post-material world
Eleanor Cooksey writes:
I have been enjoying the current BBC Radio 4 series ‘A History of the World in a 100 objects’ in which Neil McGregor, the Director of the British Museum, tells a history of humanity using objects from the museum’s collection. As I listened to his intricate description of the pestle, it made me realise that objects, things, ‘stuff’ – or however we like to call them – still have a very important role to play in our lives.
It is often easy to assume we live in a ‘post material’ world, but in a post credit crunch recovery marketplace, should we re-evaluate how we think about ‘stuff’? Looking at data from our 2009 Global Monitor Survey suggests that it is perhaps worth reviewing our hypotheses. Consumers are less likely to agree that they have all the material things they need: in the UK, this dropped from 60% in 2008 to 56% in 2009. In fact, the only market surveyed where feelings of material satisfaction have increased is Australia. Moreover, though we may not have everything we need, we are also less likely to buy more as spending without consequences is no longer in favour. Again, all markets – bar China – are showing a greater reluctance to take on debt. This suggests we are more likely to value what we have now.
Our research also suggests that people are still as interested in spending on experiences as accumulating possessions, but this is less about extreme experiences, and more about the enjoyment of simpler pleasures. Such pleasures, in fact, could consist of listening to something interesting on the radio, or going to a museum.
The image above is from the BBC’s ‘A History of the World in 100 Objects‘ website, and is used with thanks. For more information about accessing Global Monitor, please contact our UK Marketing and PR Manager, Jennifer Childs.
Add comment 26 January 2010
Struggling towards sustainability
Andrew Curry writes:
Whatever the disappointments about the Copenhagen talks, it’s clear that consumers have fairly strong attitudes to sustainability issues, and these have barely been affected by the financial crisis. That was the view of a recent report on our Henley Planning for Consumer Change [PCC] research in New Civil Engineer. Indeed, politicians seem to be lagging consumers on the question of sustainability.
The managing director of The Futures Company’s London office, Will Galgey, told NCE that “The key thing is that there hasn’t been a significant diminishing of engagement with environmental issues. In fact we see the importance of those issues continuing to rise.”
At the same time, consumers increasingly see the links between environmental behaviours and financial prudence. But not all businesses seem to have registered this.
Frank Price, sustainability director at the engineering consultancy Grontmij, argues in the article, “Some businesses may be tempted to reel in their focus on sustainability, based on a false belief that the finances needed to introduce sustainable practices could be better spent elsewhere. On the contrary, businesses that are looking to save money and reduce costs should be looking at their sustainability measures as a priority.”
The costs of not increasing the level of business sustainability are likely to be measured in business reputation. PCC data show that 79% agree that companies have a responsibility to support the communities they operate in, and businesses are identified by some distance as the group “most at fault for causing environmental damage”. At the same time, trust in businesses continues to decline. Potentially this adds up to a vicious circle in which it is difficult for businesses to increase their credibility – or a welcome opportunity to rebuild trust.
For more information about accessing Planning for Consumer Change, please contact our UK Marketing and PR Manager, Jennifer Childs. The picture at the top of the post is from Australia’s fmcg sustainability institute, and is used with thanks.
1 comment 22 December 2009
What you don’t want for Christmas
Oliver Wright writes:
One of my seasonal ‘jokes’ goes that you can tell when Christmas is approaching by the adverts on TV. Thus, like many others I suppose, I am thrust from my usual lethargy into a mild panic, making hurried calls to my siblings and parents, enquiring what they might want for Christmas, with the implicit fear that the shops might somehow run out of appropriate gifts.
In spite of our recessionary times, the high street in London has done surprisingly well for itself compared to 2008 when the onset of the recession dampened the Christmas (spending) spirit. November sales are up only 1.8% on last year nationally, but in the capital sales are up 13.3%.
Even if we are short of cash, we certainly shouldn’t be short of ideas: most of the major newspaper websites have a glut of buying guides, telling us what we could buy, and for whom. But for every article about ideal presents, one often finds a dissenting contributor in the comments sections, outlining the merits of a presentless Christmas. Capitalising on these frugal sentiments, The Green Thing has created a cunning spoof of the Amazon.co.uk website, delightfully titled Amazero.com, encouraging us to buy their single product – nothing (it’s priceless, of course). With a slightly more traditional approach, Adbusters sponsored ‘Buy Nothing Day‘ on the 26th of November this year.
Both of the above campaigns make the claim that Christmas – or more simply, buying lots of stuff – is bad for the environment, and detracts from the true spirit of the season. However, if you’re more inclined to think that Christmas is a waste of money altogether, then Joel Waldfogel’s book ‘Scroogenomics: Why you Shouldn’t Buy Presents for The Holidays’ may contain some more compelling arguments. Based on US surveys, he suggests that people would generally be willing to spend 20% less on the gifts that they received were they to buy them for themselves. This difference – in economic jargon, the deadweight loss – is worth $13bn a year in the US. He continues:
There’s every reason to believe the deadweight loss is as big elsewhere. That would get you to $25 billion a year around the world in value destroyed through gift giving.
Waldfogel isn’t against gift giving – just bad gift giving. Tim Harford has some useful recommendations based on Waldfogel’s arguments: spend modest amounts (hence reducing the likelihood of a large deadweight loss), or increase the sentimental value of your gift – invest time or creativity into making something personal. In other words, give it value to which you can’t attach a price.
In a neat twist, Waldfogel’s book is out for Christmas. But before you buy it, make sure the recipient wants to read it first.
The Image above is taken from the Amazero.com website, and is used with thanks.
Add comment 18 December 2009
The new era of consequences
Andrew Curry writes:
The shape of the post-recession consumer landscape is becoming clearer. Our latest wave of Henley Planning for Consumer Change [PCC] research, launched to clients at recent breakfast meetings, maps this. The headline is that risk is back on the agenda, and as a result, consumers have found ways of living with uncertainty; they are looking for greater control; and they are considering the consequences of their choices.
Some of these changes were already becoming visible before the recession. As our UK Managing Director Will Galgey pointed out, it has been an accelerator rather than a catalyst.
For our UK business, the launch represents a return to selling an annual trends report containing analysis and data, which we last did in 2001. We’ve been able to do this because of the expertise of some of our Chapel Hill colleagues – formerly Yankelovich – in managing published services.
Some of the data in PCC are familiar. Obviously financial worries are on the up. Confidence in corporations has fallen – the proportion agreeing that “I can trust the following [sectors] to be honest and fair” has fallen across all commercial sectors, with utilities falling even faster than banks. But the research suggests that people are less rattled by the recession than they were a year ago, even though the economy is weaker now than it was then.
This has had some costs. People now feel under more time pressure than at any time since the late ’90s, though not for exactly the same reasons. And people’s desire for more control isn’t matched by their ability to achieve more control in their lives.
The biggest impact seems to be on consumers’ willingness to make connections between their immediate surroundings and the wider world. 50% of the sample, of 2,500, thought it “very or fairly desirable” that “we won’t be able to consume as many goods and services as we have in the past”. 32% think it not at all or not very desirable, while 18% aren’t sure.
Similarly, nearly 60% now think we are at fault as individuals for environmental change – and around the same numbers think that it is both their responsibility to do something about it, and that doing something will make a difference.
From all of this, the Planning for Consumer Change data suggests strongly that new consumer values are emerging around vigilance, optimism, self-reliance, resourcefulness, connectedness, and prioritisation. This is a more complex world for brands to navigate, although the smart ones are doing it already. The good news, though, is that this offers more strategic options (and more interesting options) than a race to the bottom on price.
But as Director Henry Tucker observed at the breakfast sessions, “You’re probably not going to be able to sell the same old products to the same old consumers”. They’re expecting something from you which is more helpful – and demonstrates that you’re in tune with their new values.
For more information about accessing Planning for Consumer Change, please contact our UK Marketing and PR Manager, Jennifer Childs. The ‘era of consequences’ icon, seen at the top of the post, was designed by Tom Warren.
Add comment 10 November 2009
The last place to go
Andrew Curry writes:
We’ve been having a bit of an argument in the London office about dixons.co.uk advertising which has been running on the London underground. The picture, above, captures the flavour; lots of text in which a trip to an identifiable department store to look at some upmarket consumer electronics is descibed quite affectionately, with the final line, in Dixons’ branding, “then go to dixons.co.uk to buy it.”
The argument is about the ad’s effectiveness. On the one hand, it’s right on trend. Work we did for AOL a couple of years ago identified the way in which consumers shift between online and offline channels increasingly seamlessly as their customer journey develops from awareness to purchase and maintenance. And our post-recession research shows an increase in ’savvy shopping‘.
On another hand, the copywriting about the department store experience is sufficiently warm that it reminds you of the service such stores offer – and not everyone is as transactional as the ad tries to suggest, even in a recession.
And on another: the argument is about the effectiveness of this for Dixon’s. Its own stores, now closed or rolled into the Curry’s Digital brand (full disclosure: absolutely no relation), were a byword for customer indifference. And online, Dixon’s is not the cheapest supplier.
In fact the ad polarised office opinion – an impromptu survey showed that half the people who responded liked it, and half didn’t. The half that didn’t tended to be older and better-off.
And I have to say that I’m in the second category. The ad’s strapline, “Dixon’s; the last place to go”, is clever, but it’s too clever for its own good. For me it taps in, almost too precisely, to a whole lot of brand associations which – were if I Dixons – I’d have preferred to leave dormant.
1 comment 7 October 2009
The new face of luxury
Emily Pitts writes:
Is the concept of luxury is stuck in the past? Leafing through the high end magazines, it looks so. It’s quickly apparent that 2009 ads sell the same products, and rely on the same concept of luxury, as they have for years; the traditional face of luxury is still impenetrable, aloof and other worldly. Whilst classic luxury pieces from Chanel or Hermes will continue to resonate as high quality investment items for a small group of rich consumers, the emerging values of the new “everyday luxury” market are quite different.
The Dutch design collective Droog suggest that “Luxury is really about scarcity“. And what’s scarce? “Care, silence, fresh air, slowness”. Brands that help consumers achieve some aspect of this in their lives will be connecting to a changing notion of luxury, as values around responsibility, community and self-reliance are emerging as the new consumer lifestyle aspirations. Though in part this has been provoked by recession, Futures Company research tells us that greater numbers are re-assessing what’s important in life; hence the spike in volunteer numbers, career breaks and socially responsible career choices such as teaching. Some brands in other sectors are successfully tapping into these desires; luxury may have look outside of the sector to learn.
The personal connection with the product that Nudo achieves by allowing customers to adopt an Italian olive tree from which they receive their own oil for a year, linking the consumer with the producer, is a good example. The Harrods allotment features webcams that allow consumers to view their food as it grows, which would certainly offer ’slowness’. Burgerville supports local farms and businesses, thereby appealing to consumers’ growing social conscience. Brands that allow consumers to express their creativity are also prospering. Increasing numbers of knitting clubs, Anya Hindmarsh’s bag customisation service and the Observer Woman’s ‘Designer DIY’ series run this year bear witness to this. In the luxury market, Clarins offers a customised skin cream, My Blend, in a small number of top end stores. Personalisation is also a feature at the ‘uber-bling’ end of the scale, as Peter Aloisson’s jewel-encrusted mobile phones demonstrate.
But the challenge for many luxury brands is to move beyond this. Selling a de luxe designer handbag for its link to a wider set of values than brand cachet is not necessarily an easy bridge to build. Louis Vuitton made a good attempt with its ad campaign (picture at the top of the post) that focuses on the journey rather than the bag; the promise is, perhaps, that our personal journey can be as interesting as that of Gorbachev. Competitor brands need to follow suit, and re-adjust their focus on the part of ‘scarcity’ that really means ‘luxury’ to today’s consumers.
2 comments 21 September 2009
Some good things we’ve seen #2
Compiled by Tom Ding
Passed around the office lately were:
- A comparison of the news-to-death ratios of Swine Flu and Tubercolosis by Hans Rosling, adding an interesting perspective to Alex’s earlier post. Guess what: lots more people die of TB, but it hardly gets any news coverage.
- Naturally 7 wowing the crowd with some full-on beatboxing, in whch they impersonate a small orchestra, a video from this year’s TED conference.
- A great little insight on depictions of the future in advertising, still strangely trapped in some old-fashioned futures borrowed from the 1970s.
- The idea bounty, where creative sorts can sell ideas straight to brands. Although, as our IT Manager pointed out, the terms and conditions make for scary reading, and might just be enough to make you think twice about offering your best ideas.
- And finally, is it co-creation? is it mass customisation? is it an inventive way of improving the margins on crisps even further? The picture at the top of the post top might offer some clues. Whichever it is, the new Create-a-chip Kit from Kettle Chips is only available in the US at the moment, so we’ll have to leave that piece of research to our American colleagues.
Tuck in!
Add comment 22 May 2009
Talking about Millennials and progress
Yannis Kavounis, the head of our Millenials Knowledge Venturing team, talks to Tom Ding
Tom: Yannis, I have been meaning to ask you about Millenials and the recession…
Yannis: Recession, anxiety, layoffs… I’m personally exhausted from all the speculation and debate around it. Let’s talk about something more uplifiting: change and our future.
Tom: Sure. But where will the change come from?
Yannis: Well, not from government and politicians. They are only trying to resolve the problem using the same tools and context that caused it. So what’s left? Us – ordinary people, and Millennials of course. Millennials are connected and aware of the power of the collective. They have the technological and creative tools to take risks. And most importantly they’re young, not jaded and realise that grassroots overhaul of our economy and values is the only way forward.
Tom: I have seen a few diffferent versions of Millennials and Generation Y, what is your definition?
Yannis: At The Futures Company we say Millennials are the cohort of people born between 1979 and 1992, or roughly those aged between 16 and 29 at the moment.
Tom: OK. So give me some examples of these new values you talk about…
Yannis: So, for instance, I love how some of us are still rooting for ownership (intellectual or physical) as a fundamental principle of our economy. Well, guess what, Millennials are teaching us that modern business models can be based on more fluid and open concepts such as access and open source. Think of a world where you don’t ‘own’ but you ‘share’ – as and when you need to. Who needs iTunes when you have Spotify?
Tom: Yes and everyone I know has started using Spotify all of a sudden. I read that they just got their millionth subscriber in the UK, around the same time that the billionth application was downloaded for the iPhone – which I guess is open development, if not true open source. But is all this generational change about technology?
Yannis: Well, hasn’t generational change always been about technology, through every stage of human evolution? The interesting thing about current technology is how Millennials are using it and the role it plays in their lives. For them, it’s the means to an end, not the end itself – it is the greatest facilitator of societal change at the moment. I see Millennials as the generation that will use technology to help us enter a new age of realisation … be that in the economy, consumerism, or through our social values.
The picture is borrowed, with thanks, from wearesuperfamous.com
(edit: The Futures Company definition of Millenials is those born from 1979 to 1992, not 1982 to 1992 as originally written – a typo, apologies)
1 comment 7 May 2009
