We’re in for a ‘restless decade’ as the economic truth of the post-2008 era shifts entirely - at the MRS annual conference, Brian Carruthers hears calls for renewed focus on consumer behaviours and motivations to navigate through tougher times.
Silicon Valley Bank’s collapse is the latest addition to the lengthening list of crises – COVID-19, war in Ukraine, supply issues, economic uncertainty, inflation, climate change – that continue to make any sort of forward planning difficult. The tech bank’s collapse is “an enormous spanner being thrown into the works” in terms of what had been projected with regard to inflation and interest rates, the FT’s Claer Barrett told this week’s MRS Annual Conference.
What it almost certainly means is higher inflation and higher interest rates for longer than previously expected with all the pain that brings for governments, businesses and consumers. “There are going to be tough times ahead,” she said.
“There are going to be consumers who will be aggressively cutting back budgets and making tough choices. Your clients are going to have to fight harder to retain a share of the dwindling spend to justify spending extra on brands.”
But this is where market research can make the difference between success and failure: the ability to provide insights about why consumers prefer one brand over another is a “superpower”, Barrett suggested. “Now’s your time – prove your worth to your clients.”
It’s a view shared by Tamara Rogers, CMO at Haleon (what was until recently GSK Consumer Healthcare), who believes market research is vital to finding opportunities for growth. “What I need by my side more than anything right now is somebody who can see the wood from the trees,” she said during a panel session at the same event.
“Moving from the what to the why – digging deeper and truly understanding human behaviour and motivations – is where the answer lies,” she continued. “We all know the averages, but as soon as you start de-averaging, you find opportunity and our business is about growth.”
Even within the various consumer groups brands may identify, there is “light and shade”, Barrett noted. Two people could be working in the same jobs, in the same office earning the same money but their short-term prospects and spending decisions may depend more than anything else on when they need to remortgage. Anyone having to do so after last October’s “fiscal event” is going to be in a much worse position than they would have hoped for. (Meanwhile, the receding chances of ever getting on the property ladder are reshaping the aspirations and attitudes of Gen Z.)
We’re in for a “restless decade” according to Kelly Beaver, CEO of Ipsos. People don’t expect things to settle down any time soon, she said. And she warned that in times of such uncertainty, businesses often make the mistake of becoming more internally focused. “That is not what you want to be doing at a time of crisis,” she stated. “You want to be focused on your consumer or your citizen or your audience more than anything else.”
Another, related, error is to turn attention to cost-reduction programs at the expense of innovation. “Part of our role as the research industry is to help clients to prioritise, to still be able to innovate,” she said. And, again, the market research function is vital to innovation
In the current febrile environment, a nuanced understanding of consumers and where they stand in relation to one’s brand will likely be key to not just weathering the present storms but also to longer-term success.
In Barrett’s own segmentation of financial tribes there are a few new ones to ponder as well as those that might already be on marketers’ radars. Alongside the squeezed middle and boomerang offspring she suggests a couple we may be hearing a lot more about in the coming months and years: ‘Cafters’ (can’t afford to retire) and ‘Fonquees’ (fear of never quite earning enough). Sound like anyone you know?