Frugality is here to stay
Frugality is here to stay
I believe that consumer frugality is here to stay.
The recession has kick-started this new mindset. You just have to pick up a newspaper for evidence: retail sales, car sales, tourism, housing and construction are all declining. And it is likely to persist even after current economic difficulties end.
An article in the New York Times on 28 November entitled, "Dying of Consumption" by Stephen S Roach, Chairman of Morgan Stanley Asia, argues that consumers are now abandoning the asset-dependent spending and saving strategies they embraced during the bubbles of the past dozen years and moving back to more prudent income-based lifestyles. "Americans need to save. They don’t need another flat-screen TV made in China".
Additionally, we are beginning to recognise that we have to behave in sustainable ways. Online, the popularity of campaigns such as The Story of Stuff, shows that this is a topic that carries real weight for consumers.
Marketing has always been about encouraging people to consume, but that has started to change too. One example: De Beers has been looking at how to maintain discretionary spending on diamonds during the current economic crisis. Its research found that 62% of women would strongly prefer one wonderful gift – like a diamond – than several small ones. It believes the idea of an enduring item that retains value will persuade consumers to buy diamondsand has launched an advertising campaign with messages such as "fewer better things", "here today, here tomorrow", and "here's to less".
Tuesday, 02 December 2008 11:17