what will the uk consumer look like in the 2020s? · 2019-02-17 · key customer insight “you...

What will the UK consumer look like in the 2020s?

BritainThinks Breakfast Briefing Wednesday 30th October 2013

What we did •  Identified some major trends using BritainThinks’ own

research, as well as other sources including Trendwatching, McKinsey, PwC, Future Foundation, Edelman

•  We explored expert opinion on these trends, drawing on published research, opinion and interviews with a range of experts across different brands and sectors

•  We listened to consumer perspectives on these trends,

during a day-long workshop with 12 members of the public and revisited recent focus group data

There are lots of opinions about the 2020s…

And a well-rehearsed set of macro changes:

A growing popula-on

An older more diverse popula-on

Greater disparity of wealth and lifestyle

The London effect

CONSUMER TRENDS

Flight to the familiar

Healthy Balance

Little Indulgences

Provenance

Trust Deficit

Squeezed Britain

Networked Britain

End-to-end accountability

Little pick me ups

Seeking control

Trading circles

Anytime, Anywhere

Connected consumers

Data myning

The personal

touch

Consumer Context

Micro trends

Team Me

Trust Deficit Erosion of trust, growing cynicism about corporate behaviour, importance of trust as a key driver of corporate reputation.

29% of

Europeans trust ads on TV,

compared to global average of

47. (Nielsen, 2012)

44% claim to ‘trust

businesses to do what is right’,

down from 49% in 2010.

(Edelmann Trust Barometer)

Key Customer Insight “You can’t completely trust anyone these days unless you know they’ve got your best interests at heart”

69% agree “most companies will take advantage of the public if they feel they are not likely to be found out.”

52% agree “businesses only

disclose what they have to.” (Cohn and Wolfe/ICM)

“Trust is optimism about the goodwill of another person towards us. When we lose that optimism, we can’t be simply talked back into it. There’s no shortcut. Time, transparency, and a change in behaviour — building within oneself the property of trustworthiness — is the only way to regain trust once it’s lost.”

James Garvey, Royal Institute of Philosophy

Flight to the Familiar The growing appeal of familiar, recognised, heritage brands that consumers can rely on in tough times.

66% agree “I am more likely

to trust brands that have been around for a

while”.

45% of global respondents

report that challenging economic conditions

make them less likely to try a new product.

(Nielsen)

“For me it’s certain brands, like Pringles and Heinz Baked Beans. Even if you can’t buy a lot all week and you’re just eating beans on toast, you know you’re actually eating Heinz beans on toast. You can look in the cupboard and think, ‘Yes, I can afford that”.

“I don’t have the time or money to experiment – it’s safer to buy from brands that I know well.

“Brands can create familiarity by selling a story of heritage and

history. It’s not just those who are actually old who can do this – “familiarity”

can be reinforced in a range of ways... It can be

what your friends are talking about on

Facebook.”

Natalie Thwaites, Piper Private Equity

Evidence Customer Insight Expert Insight

Flight to the Familiar The growing appeal of familiar, recognised, heritage brands that consumers can rely on in tough times.

Brand Examples

End to end accountability An increasing requirement for transparency and information about every aspect of a product’s lifecycle or a service’s impact

50% have avoided a

product based on a company’s

responsibility reputation.

68% say transparency has become a more

significant factor since 2008

(Ethical Consumer) )

“There’s more and more reasons to worry

about where things come from and go to – I want to feel confident I’m doing the best I can for me and my family.”

“Trust is getting more difficult to build as customers become

more sophisticated. They want to know

what the total brand is doing – and make

judgements based on that.”

Jo Kenrick, Homebase


Brand Examples

End to end accountability An increasing requirement for transparency and information about every aspect of a product’s lifecycle or a service’s impact

The personal touch In an increasingly digital world, there’s a need to rethink personal interaction to create richer, more engaging experiences

58% of under

35s disagree that ‘service today is too over-‐familiar’, whereas the majority of over 65s agree that it’s over-‐familiar (IPSOS, 2008)

21% expect businesses to respond to

complaints left via social networking sites within 1-4

hours.

(Cohn Wolfe/ICM)

“It’s when they take time to understand me and what I need, that’s when it makes a difference.”

“I think the key trend that will affect retailers in the future is empathy more than anything – it will become increasingly necessary to show that you understand what

your customer is going through, and to pre-

empt their needs accordingly.”

Harry Wallop, Journalist/Author


“Facebook advertising is awesomely targeted, even

embarrassingly so, but my phone company don’t know who I am

after fifteen years as a customer.”

Brand Examples

The personal touch In an increasingly digital world, there’s a need to rethink personal interaction to create richer, more engaging experiences


Healthy Balance

Little Indulgences

Provenance

Trust Deficit

Squeezed Britain

Networked Britain


Little pick me ups

Seeking control

Trading circles

Anytime, Anywhere

Connected consumers

Data myning

The personal touch

Consumer Context

Micro trends

Team Me

Squeezed Britain Low wage rises, cuts to benefits, growing unemployment, rise of the ‘lost’ generation, uncertainty caused by the continuing Eurozone crisis.

£7

fall in avg. weekly discretionary household income (2011 to 2013)

Key Customer Insight “My financial security has never been more uncertain – I’ve got to make the money I’ve got go further than ever.”

54% are “sufferers’ or ‘squeezed’ compared to 39% in 2011 (HPI Growth Gauge)

-27: Consumer Confidence

2005: Last time it was positive

2.6m unemployed, a 17-year high

1m 16-24s unemployed. The lost generation?

“The interesting thing is that we haven’t seen a race to the bottom. At the beginning of the recession there was an expectation that everyone would flock to supermarkets like Aldi, leaving their aspirations at the door. But it’s actually a more interesting trend – people trade across, not down. People haven’t traded down from a great steak restaurant to Aberdeen Steak House – they’re going to gourmet burgers places.”

Ben Byrne, True North

Seeking control With increasing financial pressures, consumers are seeking more control over their finances and decisions.

71% agree “I spend money more

carefully than I used to”

(TGI, YE Jun 2011)

“When they can do anything – just a small thing – to help you save money, that makes a massive

difference. It’s a nice change from everyone just ripping you off all

the time.”

“We didn’t get ourselves into this mess but there’s only one person who’s going to take responsibility for getting back on top of things and securing my family’s future,

and that’s me.”

“Amidst the rising cost of living and biting austerity measures,

British consumers are adjusting to the new

economic reality, with financial prudence and savvy shopping already the default for many.”

Ina Mitskavets, Senior Consumer Analyst, Mintel


Brand Examples

Seeking control With increasing financial pressures, consumers are seeking more control over their finances and decisions.

Trading circles Making better use of limited resources and finding alternatives to conventional means of financing.

58% of under

35s disagree that ‘service today is too over-‐familiar’, whereas the majority of over 65s agree that it’s over-‐familiar (IPSOS, 2008)

Of the 79% of people who have bought something

on eBay, 65% have sold something

themselves. (BritainThinks

research)

“If I’m not using it then I might as well make some money out of it – and make life easier for someone

else like me.”

“HSBC turned me down flat because of a credit record issue. These guys – Zopa - called me up,

found out that the missed payment was a result of moving house, and

put the loan through”

“Both our lenders and our borrowers feel that they gain some sort of

social capital…By either lending money to people and "doing some good", or by borrowing money and paying interest to

real people, rather than a faceless institution.” Giles Andrews, CEO Zopa


.

Brand Examples

Trading circles Making better use of limited resources and finding alternatives to conventional means of financing.

Little pick-me-ups Small, inexpensive, uplifting moments and rewards remain important to people given the economic gloom.

59% agree that

“sometimes I treat myself to things I don’t

need” (TGI, YE JUN

2011)

“Life’s a bit gloomy at the moment so you need the occasional treat to brighten things up”.

“Pringles – they’re just so different. I only get them when they’re on offer because so dear otherwise. They’re just so different from other crisps – you feel like you’re buying a bit of luxury there.”

“Luxury consumers have found their

strategy for dealing with the recession,

however, buying little indulgences to keep them sane through the tough times.”

Janet Carpenter, Atelier


Brand Examples

Little pick-me-ups Small, inexpensive, uplifting moments and rewards remain important to people given the economic gloom.


Healthy Balance

Little Indulgences

Provenance

Trust Deficit

Squeezed Britain

Networked Britain


Little pick me ups

Seeking control

Trading circles

Anytime, Anywhere

Connected consumers

Data myning

The personal touch

Consumer Context

Micro trends

Team Me

Networked Britain Proliferation of small screens and on-the-go connectivity. Advent of Big Data and personalised offers and services.

58% of Britons own smartphones and

54% of them have watched TV while

surfing the web on their smartphones

Key Customer Insights “I don’t have to rely on what’s right in front of me, I’m always connected to a million views, opinions and other options.” “It’s great when they just understand what I need, especially if they offer me something I hadn’t thought of”

Mobile commerce is predicted to

grow an average

39% each year from now until

2016

Every two days, we now create as much information as we

did from the dawn of civilisation until

2003 (Eric Schmidt, Google).

“Every business needs to “go digital.” Data about customers, competitors, suppliers, and employees are exploding. Ninety percent of all data were created in the past two years. By 2016, there will be 3 billion Internet users globally, and the Internet economy will reach $4.2 trillion in the G-20 nations.”

‘The Connected World’ (2012), Boston Consulting Group

“This isn’t simply about shifting to technology – its about the connection between online and offline. Argos have found the way to leverage a strong online presence with offline, retail presence. That’s the key to surviving.”

Andy Chung, www.whatsinmyhandbag.com

Anytime, anywhere On-the-go, time saving access to products and services to provide solutions when and where I want.

44% of

smartphone owners admit to showrooming

Mobile commerce in

2012 was worth

£4.8bn,

£80 spent per person in the UK

(comScore)

“Because I’m so busy and the technology exists these days, I

expect to be able to get whatever I want, whenever I want”.

“Mobile and tablet usage is rocketing –

and because this changes the way that

customers can organise and access

their own information, they start to expect

the same from brands too.”

Mobile retail consultant


Brand Examples

Anytime, anywhere On-the-go, time saving access to products and services to provide solutions when and where I want.

72% of consumers trust online reviews

as much as personal recommendations

47% of 18-24 year olds said that they

expect all CEOs and senior business leaders to be visible and accessible on social media 24/7 (Local Consumer Review Survey)

“It’s so easy to find out what other people

think of things – why wouldn’t

you use that to help you choose?”

“Social media is also linked to the trust

issue – customers can, and choose to, trust

each other rather than trust brands.”

Martin Campbell, Beacon Strategic


Connected consumers Consumers are connected to each other, to ‘amplifiers’ and to brands like never before. Increasingly consumers are learning to use this to their advantage.

Brand Examples

Connected consumers Consumers are connected to each other, to ‘amplifiers’ and to brands like never before. Increasingly consumers are learning to use this to their advantage.

85% of people know that

online purchasing history data are collected and

48% expect to be sharing

more personal data with companies in ten years.

(Demos)

“At first you feel apprehensive about the fact that they have all this data

about you – but then you realise it can actually save you

time, like not having to always be telling them your details.”

“Customers don’t mind if they get an offer based on

data for something aspirational – 20% off in a shop, or a free coffee. But for other brands – a bank, say, it’s a less appealing experience so may just

leave the customer unhappy about the use of their

data.” Multi Channel Retail

Manager


Data myning [h/t Trendwatching] Big data has focused on the value of customer data to businesses. Savvy shoppers will turn to brands that use this data proactively on the consumer’s behalf.

Brand Examples

Data myning [h/t Trendwatching] Big data has focused on the value of customer data to businesses. Savvy shoppers will turn to brands that use this data proactively on the consumer’s behalf.


Healthy Balance

Little Indulgences

Provenance

Trust Deficit

Squeezed Britain

Networked Britain


Little pick me ups

Seeking control

Trading circles

Anytime, Anywhere

Connected consumers

Data myning

The personal touch

Consumer Context

Micro trends

Team Me

“‘Team Me' brands can build a deeper level of engagement and a reciprocal respect. Customer-centricity needs to be reflected in every touch point – building trust through clear motives and authenticity. “Consumers are increasingly looking for demonstrable personal benefits through allowing access to their data. Getting this right can visibly position a brand as part of ‘Team Me’ – getting it wrong further undermines trust.”

Viki Cooke Founding Director, BritainThinks

Understand what matters to me and make that your priority: Know where I’m at, know where I’m going

Brand Examples

www.britainthinks.com

what will the uk consumer look like in the 2020s? · 2019-02-17 · key customer insight “you...

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