research

Deloitte Study: Consumers Love Spending Less

Shopper

The good news from Deloitte's "New American Pantry" is that the vast majority of consumers don't feel bad about the recession -- they actually love it: 81% of those surveyed say they find saving money, using such techniques as coupons or loyalty programs, fun.

The bad news is for brands everywhere: The more adept consumers get at saving, the less they care about buying a certain brand, and are more willing to trade down or in favor of a sale than most marketers imagine. Think they've got a favorite brand in many categories? Ha: 51% percent say they are loyal to no more than two to three brands, in any given supermarket.

"There was a very palpable sense of remorse and embarrassment about the way they used to shop," Pat Conroy, vice chairman and Deloitte's consumer products practice leader in the U.S., tells Marketing Daily."They have a real sense of 'I can't believe how wasteful I used to be when I shopped. I didn't even know what was in my pantry and freezer.' Now, it's almost like they are energized by this new approach -- it's like saving money when they shop is a new kind of game, a way to stick it back to the man."

advertisement

advertisement

The survey, conducted with the Harrison Group and based on data from more than 2,000 adults, revealed four distinct types of consumers. It calls the largest group (at 36%) spectators -- they are the youngest and most affluent group, the least impacted by the recession and the least likely to change their shopping habits.

Next come the sacrificers (22%), who are the lowest-earning group, and the most impacted. Next (at 21%) are the super planners, who also take the most delight from saving. Finally, planners -- also 21% -- focus more on saving money through food preparation and menu planning.

Of the four, only the sacrificers are resentful about the recession's impact on their shopping, and somewhat bitter at the continual sacrifices the economy has demanded. "For them, there's a real sense of being hit by bad circumstances from all sides," he says.

Overall, 79% say they feel smarter about the way they shop versus two years ago, 65% feel like they aren't sacrificing very much, and 61% say they are more price-conscious. Loyalty cards are critical: 84% have at least one, and 65% say they are either essential or very important as a money-saving method; 44% now use loyalty cards in grocery stores every time they shop.

But brands are clearly huge losers, with 31% saying they are less brand-loyal, and 85% saying they have found several brands that are just as good as national brands. (In fact, 80% believe most store brands are manufactured by the traditional national brands, anyway.)

Deloitte also asked consumers to weigh in on brands in 21 categories -- more than 100 brands in all -- and found that only a handful are what it dubbed "destination brands," which he says means "an abundance of consumers say 'I will seek them out, regardless of channels, and for the most part, regardless of price." The second category was "preferred only" brands, which consumers say they would like to buy, but won't go out of their way to find them.

And finally, there was a category of "sale-only" brands, where consumers say they would only buy them if there were a significant promotion. "Consumers have a real 'I don't need 'em' attitude toward this final category," he says, adding that the implications for marketers are considerable. "There are brands offering coupons and promotions that probably don't need to, and others that need to know how little they are valued."

But Conroy says it would be wrong to think consumers only care about price. "What consumers are really focused on is the value," he says. "They're saying they won't buy large sizes because they are cheaper -- if it results in waste, for example. What's driving this is not just the urge to spend less, but to get the most value."

4 comments about "Deloitte Study: Consumers Love Spending Less ".
Check to receive email when comments are posted.
  1. Howie Goldfarb from Blue Star Strategic Marketing, July 14, 2010 at 9:59 a.m.

    I know this upsets Brands/Consumer related businesses, Advertising, Media but its best for the country if we live within our means and reduce our debt levels.

  2. Auriette Lindsey, July 14, 2010 at 10:04 a.m.

    I like saving money as much as the next person, and financial circumstances requires me to make smart choices, both at the office and at home.

    That said, no amount of marketing and public relations can overcome a company's product and service. When buying a more expensive name brand doesn't get you better quality merchandise and better customer service if you have a problem, why pay more?

  3. Ronald Stack from Zavee LLC, July 14, 2010 at 10:41 a.m.

    This is a real opportunity for smaller marketers and smaller merchants to reinforce their connection with their customers, provide outstanding service and leverage social media to achieve their potential cost-effectively.

  4. Candice Seiger from Luminosity Marketing, July 15, 2010 at 12:11 p.m.

    We are seeing similar results in our Little Luxuries Project. Even when the purchase is a little treat for themselves, the consumer is still looking for a "deal." Find out more about the Little Luxuries Project at http://bit.ly/bxChb6

Next story loading loading..