The impact of rising inflation and the increasing cost-of-living continues to filter down to retailers as new statistics show Britons reduced their ‘discretionary purchases’ in May.
And there doesn’t appear to be an end in sight. The cost-of-living crisis – expected to last for at least two more years – combined with other overlapping crises and cultural shifts, means the world is in what experts have called a ‘permacrisis’.
At We Are Social we create socially-led advertising for our clients, and with four in five Brits saying the economic situation is affecting them directly, we decided to dig deeper to find out exactly how that was translating to behaviour, in our recent Rethinking Value report.
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In short, people are evaluating their shopping priorities as they rethink value, whilst the price tag continues to be important, consumers are also looking for meaningful interactions with brands, or escapism from the day to day.
We have identified some key trends that retailers should consider as they plan their ongoing marketing campaigns and how they work with their partners, such as influencers and ambassadors, to assure they are aligned with the values of their customer base.
The knowledge flex
One of the most noticeable changes is that social media influencers, who used to show off what they have, are now showing off what they know. Audiences who are struggling to make ends meet – and in the case of Gen Z cannot ever imagine living on their own – are turning away from naked materialism.
We found that 69% of UK and US adult social media users are reporting influencers have helped them save money by highlighting cheaper options. This ‘de-influencing’ is a new direction – it’s about what not to buy, how to save money on alternative products and how to avoid wasting budget.
In this movement, the public can expect to see a resurgence of the ‘how to’ videos and hack culture, particularly as people move towards making their own products and gifts and embrace DIY to save money.
Brands need to bear this in mind and offer bite-sized chunks of knowledge about what people can do with their products and services. A little less aspiration and a lot more down-to-earth and realistic messaging are guiding philosophies.
New materialism
The permacrisis is changing fundamental attitudes towards materialism, with the Edelman Trust Barometer 2022 showing 52% of the public think capitalism does more harm than good.
We’re seeing groups of people coming together to take back control from companies that typically ascribe value, and institutions that have used it arrogantly. See the Swifties (Taylor Swift fans) taking Ticketmaster to court in an antitrust action over what they say was a bungled launch of concert tickets.
Brands will need to react to this new trend by ensuring their social activity aligns with customer values. Loyalty will become more important and brands will have to breathe new life into their loyalty programmes by supplementing traditional offers and points with new experiences that speak to their shared values.
Performative denial
At a time when 45% of Gen Z and millennials see no point in saving until the current crises are over, we’re seeing a role reversal in which celebrities and the wealthy embrace conscious consumerism while the average person experiments with assuming comedic old-money roles. In the absence of a traditional plan to knuckle down and save a deposit for a house, people are creating new roles for themselves. There is an accompanying dialogue in the new roles around recession and simpler, less luxurious fashion and accessories.
For brands, there is a need to immerse people in fictional worlds by adding a sense of relaxation and escapism into corporate messaging. There is a sense of calling out the good times of the past here, as a form of relaxation and escapism.
Deliberate living
Reevaluating value has led many consumers to double down on the values they espouse and want to see reflected in the world around them. Pursuing a simple, meaningful life is the priority for many, with latest trends including off-grid living and pursuing a digital nomad life, or simply focusing on activities that bring them outsized joy and happiness.
This is prompting people to be more open about gamifying their couponing, sharing their discounted purchases like prized trophies. There is still space for the high life but it tends to be a one-off extravagant treat to be savoured rather than the norm.
These new trends are not only seeing consumers rethink value beyond a monetary sum, they are prompting the public and brands to consider value in a more meaningful way. It’s not so much about bling and making friends but embracing escapism and enjoyment.
While consumers are embracing saving money – through necessity as much as choice – retailers should be encouraged to think beyond the usual narrow definition of value, reflected in the cost of an item, but instead use marketing and communications to help reflect the fun, joy and whimsical role play that comes when the high life is out of reach.
And businesses that hit the mark now will be those to whom consumers are most likely to stay loyal when the economy returns to healthier times and disposable incomes are once again a reality for the British consumer.
