Applying behavioural science to an era of permacrisis

Human beings dislike uncertainty and change, but in the current series of crises, familiar anchors and reference points have gone and consumers are developing complex behavioural strategies as they struggle to adjust to new economic realities.

Why it matters 

The price of energy, food and fuel has soared in recent months and almost everyone is feeling the pinch. In an era of permacrisis brands must continue to pivot, stretch and squeeze in order to maintain or build traction and connection with consumers. Behavioural science provides valuable insights into consumer motivations and how to respond at this volatile time.

Takeaways

• There is an increased focus on getting through the present, consumers have limited capacity to think about or plan for the future. They are prioritising experiences, holidays and living life post-pandemic, regardless of the doom-ridden economic situation. 
• Day-to-day, there is evidence that people are coping by buying more little luxuries. Faced with a bleak horizon, consumers are pushing back on big ticket spending and looking for small inexpensive comforts.
• Many people have not experienced inflation before and as prices rise on all fronts, they have lost their usual budgeting anchors and reference points.
• People will change their behaviour to avoid uncertainty and will seek out situations they can control, even if it makes them worse off. As a result, people may cling to the familiar even more than usual in order to maintain some feeling of stability and predictability. 
• Alternatively, the search for stability and certainty can sometimes drive new behaviours. For those with some spare cash, the energy and fuel crises have actually acted as tipping points, encouraging people to invest in new technologies which could help to reduce their living costs in the long term.

Read more in Money’s too tight to mention: How behavioural science can help build understanding, empathy and connection to the struggling consumer in 2023, a WARC Exclusive from The Behavioural Architects.