This is the final instalment of a three-part series where we’ve looked at the impact of the state of economic and consumer affairs on discretionary spending, and what it means for marketers in specific categories. In this part, we summarise what marketing managers need to do in the uncertain times we find ourselves in.
In the first part of our series, we explored how increase consumer uncertainty about a myriad of factors from COVID, geopolitical instability and cost-of-living pressures are putting downward pressure on consumer confidence, now approaching levels at the outset of the pandemic.
A new term, BANI (standing for brittle, anxious, nonlinear, and incomprehensible) summarises how brands and consumers are feeling about many things. During COVID, TLF developed a way to segment consumers based on their information processing filters, or how they frame things, that can help brands identify how best to reach consumers by ensuring that communications are adopting the right tone that reflects current consumer mindsets.
In the second instalment we looked at what some burning questions marketers have about consumers, such as discretionary spending shifts, and how a combination of data sources is essential to providing robust insights as once trusted paradigms about consumer decision-making and shopper behaviour, such as brand loyalty, have been challenged.
A key implication of the current state of affairs is that consideration sets are being re-defined, across both brand and category level. Therefore, it is critical that marketers understand the following:
- Consumption behaviour has changed all the way from personal values, to how consumers engage brands and communications, and the channels they use, and marketing spending should reflect these shifts.
- Omnichannel execution is fundamental to staying relevant and convenient
- Customer-relationship management (CRM) systems are essential given the shopping around that consumers are doing as they pursue products and services that fit with their price-sensitivity and trading-down mindsets
- Building trust through communication and managing customer expectations is vital