Deloitte: The average consumer is gone
- 20 June, 2019 06:38
Gone are the days of the ‘average consumer’ and the idea that there's a one size fits all when it comes to marketing, according to Deloitte.
More diversity in areas such as race, education, income and rural-urban residence has led to increased fragmentation and distinct subsets of consumers with varied needs, the consulting group noted during a presentation at Salesforce Connections this week. In addition, reduced barriers to entry have resulted in an abundance of new niche retailers and products providing access to more extensive and competitive options to consumers. And consumers are voting with their spend.
Deloitte digital leader, retail and CPG, Robert Stephens, said the consulting griant recently undertook a study into consumers to see if conventional wisdoms were true. The aim was to gauge if consumers are actually shifting from products to experiences, taking fewer trips, and are time starved.
The research found how people choose to spend their money is not all that different from 10, or even 30, years ago. Instead, it’s the economic, demographic and cultural factors around them creating nuances that are turning traditional retail and consumer products sectors on their heads.
Deloitte also found Millennials are financially worse off than their predecessors, with a 34 per cent decrease in their net worth since 1996.
“There can be no more one size fits all to marketing, there is too much diversity,” Stephens told attendees. “Consumers are delaying lifecycle milestones, they are getting married later, having kids later and buying homes later.
“However, people are actually less busy than they think. Seventy-six per cent say they have less time than a year ago; however, there has been a 9 per cent decrease in hours worked per person since 1960.
“This means an hour of extra discretionary time per week, but they are not spending it shopping. They are shopping about 30 minutes less per week. This is because the days of going to the mall and doing all your shopping don’t exist anymore.
“We are going more places, but not to retail stores."
As a result, Deloitte found 62 per cent of retail stores didn’t see any gain in traffic from 2017 to 2018. However, drilling down further, some gains could be seen in discount, convenience and QSR retail, against losses in large-scale stores and malls.
“So, when it comes to the consumer, don’t confuse choice with change," Stephens said. “Back in the day, we had a homogenous consumer base. Now, increasingly consumers are heterogeneous. Years ago, we had fewer retailers, now we have many competitive retailers.
"Consumers have way more choices to meet their needs, and they are doing it in a way to suit them.”
- Vanessa Mitchell travelled to Connections as a guest of Salesforce.
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