Commentary
The Sky May Not Be Falling, But The Ground Is Definitely Shifting
- by Hugh Hough , May 13, 2009
1. Simplicity. Many people who have lost their jobs, taken pay cuts or seen their savings accounts eroded have been forced to reduce spending. While, initially, this scaling-back may feel like sacrifice, over time, many will begin to appreciate and even enjoy a more simplified version of their daily lives.
Consumers who were able to keep their jobs and maintain their incomes will turn toward simplicity, as well. Look for a growth in household activities, both traditional and less so. Knitting is up, as is anything related to home theater. Traditional recipes (comfort food) will continue to gain popularity. Consumers will also seek to find new efficiencies in the operation of their homes and lives. Simpler will coexist with smarter.
What can your brand do? Embrace the spirit of simplicity. Reduce your packaging. Reduce your SKUs. Perhaps it's time to give consumers less choice. Patagonia is already doing this on a few of its items. Your brand will be perceived as being forward-thinking and responsible by proactively reducing its impact on a world that is using its resources faster than they can replenish.
2. The conspicuous absence of conspicuous consumption. The other side of the move toward simplicity will be rejection of ostentatious displays of wealth. More and more, these will be seen as evidence of greed and selfishness, or at best, cluelessness. Think U.S. auto executives in private jets.
More and more consumers, especially Awakening Consumers, will ask, "Do we really need this?" Construction of oversized "McMansions," already nose-diving, will not make a come-back on any sort of meaningful scale. Hummers will be seen as the Official Vehicle of Stupid People.
What can your brand do? Don't be about flash or fashion, be about substance. Consumers have not stopped spending, even on high-ticket items, but they will only support brands whose quality levels legitimately warrant a high price tag.
3. The community will get broader and deeper. Right now, consumer confidence is at an all-time low. When people aren't confident, they look to others for help. Acts of collaboration, while borne of necessity, will forge a spirit of solidarity that will carry on once times get better. A larger sense of community will emerge.
Volunteerism will grow through the course of the recession. People out of work will be more inclined to donate their time -- as opposed to their money -- to causes that are important to them.
As the sense of community gets deeper, the sense of what constitutes community will expand, as well. Global environmental stewardship will be seen as an extrapolated concern for the community.
What can your brand do? Embrace your community -- i.e., your stakeholders. Start with your employees. Look at ways of adding depth to the relationship you have with them. Commit to becoming a better environmental citizen. Recognize that environmental responsibility is a journey, and create a platform that will permit and encourage your shareholders to join you.
The current global economic crisis is tearing down many of the pillars that have supported business and society since the dawn of the Industrial Revolution. But from these ashes will rise a consumer marketplace that is more values-driven: simplicity, responsibility and community. If your brand can genuinely live and articulate these values, it will be in a position to thrive.
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I find this very insightful. It makes the point very will about the changing economy,
I think the changes are going to become permanent. There seems to a major change in the attitude toward spending and consumption. It is as if people have woken the morning after a long party and said "I did what? I am never going to do that again."
I hope you're right, Hugh. In many ways, the society you describe seems like a giant advance over the one we live in today. (As I write this, I'm keeping a careful eye out the window for strangers; our next-door neighbors were robbed yesterday, by thieves who were clever enough to disarm the security system.)
But, unfortunately, I can't help but nurse a little bit of skepticism. Eight years ago, during the last recession, the Chairman of a large corporation told me that, in fifty years, he had never seen business so bad. Yet, just a few years later, we had already forgotten any "lessons" learned, and we were back to our usual frenzied chase for bigger and better and more and more. This time, of course, it's come back to really bite us - worse than ever before in our lifetimes.
Have we actually learned the lessons this time? Or, once we feel secure again, are we doomed to repeat the same self-defeating, environmentally-degrading, and business-corrupting behavior as before?
Perhaps, if we take the trouble to remember the pain we've experienced over the past year or two, we may stand a chance, yet.
But our record ain't a good one...
Steve Winston
President, WINSTON COMMUNICATIONS
(954) 575-4089
steve@winstoncommunications.com
www.winstoncommunications.com
The more businesses reflect the values of people, the more they are likely to hit a meaningful emotional chord. As unintuitive and challenging as it is in cash-strapped times, this is where businesses need to catch up in order to relate to consumers. Defensive posturing will be seen as a sign of weakness and desperation, where as sharing and cooperation will be highly valued. Wow. That was a diatribe.... What I meant to say was "Great article, Hugh." ;)
I recall reading a similar piece back in 1989 (I wish I could find it, Time cover story perhaps?) when we had just come off the roaring 80's and "greed is good" Wall Street era and were entering a recession that paled in comparison to the impact of the current one.
It predicted that people would live more simply, closer to the earth, be more civic-minded, and would avoid signs of conspicuous consumption... permanently. I think all that sounded good then and sounds good now.
But as we all learned, people will live simply up until the point that income increases. At that point the American consumer spirit takes over and drives a cycle of overconsumption once again. As marketers, we have to take part of the blame for what took place and some responsibility in making this prediction a reality in the future.
Let's hope this current vision proves more enduring than the last one, for everyone's sake.
What will rise from the ashes will be consumer spending, consumer confidence, "McMansions", expensive cars... etc. Let's not get polyanish. We've been down this road before, the sky has fallen, and it has come up again. For better or worse.
I very much agree and hope this comes true. Dare I say "let the true character of the human race emerge"?
Very interesting to read through the comments on this wonderful article. People are responding to Hugh Hough's thoughts in very black vs. white terms. Where are the shades of gray? There are some people who clearly will never change, whereas others will learn from this experience and adopt a different lifestyle, as Hough suggests.
I'm betting a larger core of people will adopt mindful environmental practices. It won't be the mass market, but it will be a larger and more significant percentage of the population that we are seeing now. There are several trends driving this:
1) Green is chic. You can have a lot of money and still "trade down" to demonstrate your commitment to sustainability. This will continue, even with the economy picks up.
2) Green values are being aggressively incorporated into the curriculum at schools all over the country, and even "kid marketers" are pushing these messages. Look at what Terracycle did with upcycling. The next wave -the youth - will continue this trend.
But will it mark a seachange in American consumerism? No. The guy whose Hummer was repossessed will go out and get another one as soon as he can get the credit to do so and the economy has picked up.
It's not either / or. It's both.
Great article and loving the comments!
I'm looking forward to a return to simplicity. In the 1950's, the average house was 1100 square feet and the average price was two times household income. Can you say, goodbye McMansions and hello to 92K houses again.
I was raised by my great-grandmother and grew up during the 50's and 60's. We lived on her Social
Security and a welfare payment she got for me as a dependent. We lived in apartments and never had a washer, dryer, refigerator, telephone or an automobile. Not until I was out of the Marine Corps and college did I live a lifestyle most of my peers took for granted.
The United States has needed a reality check for a long time. And not until we instill in our youth, the values of preservation, conservation, reuse, recycling and the intrinsic satisfaction that comes from doing good and meaningful work can we really hope for a better future. Living within one's means and for the betterment of all should take precedence over thoughtless consumption.