There is a study recently published by
M&C Saatchi, a global advertising agency with headquarters in London. It puts consumers into categories based on their behavior and reaction to the recession.
I'll get to those categories in a minute, but I think it's important to first note that the premise of this study is that while we are all effected by the recession differently depending on where we live and the local economy there, we generally are reacting to the macro economy - as it's reported by mass media.
We are bombarded daily by dismal reports of national or even global economic downturns. We cannot help but let this color our thinking. Yet, things might actually not be so bad in the immediate area around us.
So, the study and the categories are generated by how we are reacting to macroeconomics.
‘Reacting to Recession' is the name of the study. It identifies and categorizes attitudes and behavior adopted by different groups of consumers. The study finds eight consumer types with distinct approaches to spending in this recession.
Each identified group has adopted an overall specific behavior to cope financially with the downturn.
Crash Dieters
Scrimpers
Abstainers
Balancers
Treaters
Justifiers
Ostriches
Vultures
A caveat before the descriptions: they're not based on socioeconomic status, meaning that you can be in the Crash Dieter...and a millionaire.
Crash Dieters are the largest segment, grabbing 26% of adults participating in the study. The group was so named because it aims to "shed pounds" from their weekly budget by identifying and cutting out all non-essential spending until things improve. Crash Dieters are a heavily cash orientated group. Debt clearly frightens them (or is unavailable to them). They live from week to week and when the money runs out they're forced to take quite drastic action.
Scrimpers made up 13% of the study population. Cutting spending is still a main reaction, but they want to maintain their lifestyle and are reluctant to make sacrifices. "Trade down" is more their philosophy than "cut out." Cheaper stores and private labels have become more important to them.
Abstainers, like their Scrimper brethren, don't plan to make any huge cuts in spending habits. About 15% of the population are Abstainers. "The big purchases can wait until the economy improves," is what they'll tell you.
Balancers is one of the smallest groups. Nearly one in 10 people in the study fit into this category, which doesn't want to compromise or make any changes to their pre-recession lifestyle. However, a monetary crisis for them, say a job loss, triggers abrupt behavior. There's no "trading down" - It's gone.
Just over 12% of the study population are
Treaters. You could describe them as Crash Dieters who occasionally binge. Every once in a while, the frugality they have adopted to deal with the recession gets rewarded by the purchase of something they promised themselves they wouldn't get.
Another 12% are
Justifiers. They'll spend, but they need to have a reason - and it's not price-sensitive. If it's a newer version of something they already have, they want it and convince themselves it's a wise expenditure.
Everybody knows what an
Ostrich does when it confronts danger - supposedly - and this is the way 9% of the study population is reacting to the recession. They're simply ignoring it - either because they have sufficient means to do so or because they have been brought up to believe that large balances on credit cards is the accepted norm.
At 4%, the smallest category was given the name
Vultures. They're thriving on the carnage caused by the recession. Prices on many things have plummeted. They're swooping in and purchasing all they can.
The study is ostensibly for the purpose of how to market to these groups during the recession; and these distinctive categories of behavior strongly show that there may be only one recession globally...but we certainly are not all reacting to it in the same way.
Obviously, the propensity to purchase life insurance products at this time by these categories presents the same types of obstacles and challenges as any other industry.
Do you recognize yourself in any of them?
