Comley Report on consumer behaviour

The first in our series of Comley Reports on consumer behaviour will be published on 23rd June.

The reports are an example of our integrated approach to understanding how and why consumers act as they do. Our approach differs from the traditional market research philosophy in that we aim to bring together both primary and secondary sources to deliver a broader perspective. In contrast, the trouble with traditional market research is that it only answers the client’s brief. The industry as a whole is very good at being reactive and giving clients answers to their specific questions. It’s less good at helping them to contextualise the questions, and providing ‘the bigger consumer picture’.

Over the past few years it’s become clear that primary research is only part of that bigger picture – we need to go further, looking at multiple sources to establish the ‘why?’, anticipate change and spot opportunities.

An example of this from our upcoming Comley Report is a consumer trend we’re calling ‘My Price’.

Join the Dots uses this term to summarise the effects of the increasing power of the consumer in recessionary times. It is one of four main trends we’ve isolated by literally ‘joining the dots’ between macro trends in society and the economy, the numerous people we talk to every day in our surveys and the communities we work with.

The UK economy is still being kept alive by the life support system provided by low interest rates. In spite of this, the patient is suffering from declining living standards for the first time in many decades.

The conspicuous and careless consumption of the 80s and 90s is at an end and we are firmly in an era of greater prudence - essentially there has been a marked decline for many people in the amount of ‘stuff’ they are buying.

An illustration: Levi's published some interesting research recently showing an increase in ‘mission shopping’ and how consumers are trying on less clothes now and even touching less of them in store to try to cut back.

More generally, the competitive set now often extends outside the product category, as consumers prioritise whether to spend at all in a category. Despite this, there appears to be a ‘sacred box’ of items that are not being affected as much – witness the success of the iPad. For most this box includes: mobile phone usage, TV entertainment packages, provision of broadband and the use of a car.

Declining demand and sales has meant the pricing power is now literally in the hands of the buyer in many markets. Think of Amazon’s shopping app which allows users to scan any item they see in store and immediately be offered a competitive quote. There are also an ever increasing number of markets covered by price comparison websites.

Vouchercloud has been very successful in driving localised discount sales. However ideas like Groupon have the most potential to really put pricing pressure on many markets, particularly when local personalisation is sorted out.

One implication of this trend is that people appear to be becoming less brand loyal. Nielsen calculate that 40% of grocery sales in the UK are now accounted for by BOGOFs and similar promotions. In a recent US survey by the Amp Agency of 25-49 year olds, only 3% said they were loyal to a particular brand across a range of product categories. It is our view that in many sectors loyalty can be explained in terms of either convenience (in the case of petrol stations for example) or price (where an fmcg brand is frequently on offer).

We discover these sentiments from our primary research but, as is clear here, by looking at secondary sources and combining findings from multiple projects it become possible to learn so much more. More importantly, it becomes possible to make connections that give clients a real understanding of how their products and services fit into a broader consumer context. And with understanding comes opportunity – the chance to change, react and ultimately profit by increased consumer awareness. That’s the real value of joined up research.

The first report in the series will be available on 23rd June. To order a copy please contact g.lawrence@jointhedotsmr.com