The new consumer economy what to watch and what to do
Download
1 / 43

The New Consumer Economy: What to watch and What to do - PowerPoint PPT Presentation


  • 115 Views
  • Uploaded on

The New Consumer Economy: What to watch and What to do. James Russo, Nielsen. KEYS. TO. GROWTH. REACH: An increasingly economically divided consumer CONNECT: With consumer need states LEVERAGE: The redefinition of value TARGET: Economically powerful consumer segments

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about ' The New Consumer Economy: What to watch and What to do' - urielle-leach


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
The new consumer economy what to watch and what to do

The New Consumer Economy:What to watch and What to do

James Russo, Nielsen


KEYS

TO

GROWTH

  • REACH: An increasingly economically divided consumer

  • CONNECT: With consumer need states

  • LEVERAGE: The redefinition of value

  • TARGET: Economically powerful consumer segments

  • UNDERSTAND: New viewing habits


Increasingly economically divided consumers
INCREASINGLY ECONOMICALLY DIVIDED CONSUMERS

1 in 2 Americans own stock, mutual fund, 401K or IRA

1 in 7 Americans rely on food stamps

87% of Americans earning over $75,000 own stocks

20% of Americans earn less than $20,000 a year

Source: msnbc.com; CNN Money*Supplemental Nutrition Assistance Program (SNAP)


Retail spending driven by affluent households
RETAIL SPENDING DRIVEN BY AFFLUENT HOUSEHOLDS

Retail Spending: 2 year trend

Approximately

20% of HHs earn over $100k

Source: Nielsen Homescan, 52 w/e 10/1/2011 versus 10/3/2009

excludes gas-only or Rx-only trips


US MEDIAN HOUSEHOLD INCOME ON DOWNSLIDE

Source: U.S. Census Bureau; The New York Times & USA TODAY/Sentier Research


You can no longer afford to be middle of the road
YOU CAN NO LONGER AFFORD TO BE “MIDDLE OF THE ROAD”

Conventional Retailers can no longer be …conventional

They need to differentiate themselves more than ever – to get beyond price


KEYS

TO

GROWTH

  • REACH: An increasingly economically divided consumer

  • CONNECT: With consumer need states

  • LEVERAGE: The redefinition of value

  • TARGET: Economically powerful consumer segments

  • UNDERSTAND: New viewing habits


What we did
WHAT WE DID

  • Selected a list of major CPG & Retail advertiser brands to include in the analysis

  • Categorized ads (4000+) by creative approach: humor, narrative, sentimental, product, promotional & value

  • Evaluated the “effectiveness” of each creative approach throughout the recession (from 2006 through 2011) among Adults 18+


When desiging ads the smart money is on humor narrative sentimentality
WHEN DESIGING ADS, THE SMART MONEY IS ON: HUMOR, NARRATIVE, SENTIMENTALITY

2006 - 2007

2008 - 2009

2010 - 2011


Focus on the connection
FOCUS ON THE CONNECTION SENTIMENTALITY

  • Marketers focused on product features and promotion/price do not resonate with viewers . . . even during tough economic times

  • Consumers respond to marketing that makes a connection. Focus on creating messages that engage audiences with humor, sentimental/family themes, and relatable/engaging storylines over those that tout price/promotion/product features


KEYS SENTIMENTALITY

TO

GROWTH

  • REACH: An increasingly economically divided consumer

  • CONNECT: With consumer need states

  • LEVERAGE: The redefinition of value

  • TARGET: Economically powerful consumer segments

  • UNDERSTAND: New viewing habits


Value is not just about price it s about the balance of price and benefits
VALUE IS NOT JUST ABOUT PRICE, IT’S ABOUT THE BALANCE OF PRICE AND BENEFITS

Value Consumer = Benefits/Price

Value Consumer = Price

Greek Yogurt

Avg Price +107% higher

Unit Sales 134%

All other Yogurt

Unit Sales -8%

Premium Coffee

Avg Price 18% higher

Unit Sales 5%

Mainstream Coffee

Unit Sales -4%

Premium Chocolate

Avg Price 83% higher

Unit Sales 10%

Mainstream Chocolate

Unit Sales 6%

Pasta Excluding Health

Healthy Pasta

Avg Price 57% higher

Pound Sales 5%

Pound Sales 1%


Nearly half of consumers have shopped at alternative value formats

Shop PRICE AND BENEFITS

NEARLY HALF OF CONSUMERS HAVE SHOPPED AT ALTERNATIVE VALUE FORMATS

75%

72%

Plan to shop in the next 12 months

66%

56%

Shopped

In the past 3 months

56%

52%

46%

$100K+

<= $49K

$50K to $99K

Defined as: Thrift, 2nd hand/used goods, consignment, & pawn stores; Craigslist website; check cashing establishment

Source: Nielsen Homescan Survey – February 2012


KEYS PRICE AND BENEFITS

TO

GROWTH

  • REACH: An increasingly economically divided consumer

  • CONNECT: With consumer need states

  • LEVERAGE: The redefinition of value

  • TARGET: Economically powerful consumer segments

  • UNDERSTAND: New viewing habits


Key trends that will impact behavior
KEY TRENDS THAT WILL IMPACT BEHAVIOR PRICE AND BENEFITS

Increasingly Multicultural

Older but Wiser

Stagnant Population

Increasingly Urban

Declining Families

Smaller Households


ETHNIC HOUSEHOLDS WILL BE THE MAJORITY BY 2050 PRICE AND BENEFITS

54%

35%

Source: US Census


But the opportunity is today
BUT THE OPPORTUNITY IS TODAY PRICE AND BENEFITS

AFRICAN-

AMERICAN

HISPANIC

AMERICANS

17th

12th

ASIAN

AMERICAN

LARGEST

ECONOMY

LARGEST

ECONOMY

27th

LARGEST

ECONOMY


Connected but connected engaged
CONNECTED BUT CONNECTED = ENGAGED PRICE AND BENEFITS

HISPANICS

AFRICAN AMERICAN

ASIAN AMERICAN

view

text

talk


The gap
THE GAP PRICE AND BENEFITS

New Product

Ad Spending

Hispanic

African American


HOW WE GET THERE PRICE AND BENEFITS

REACH

RESONATE


KEY TAKEAWAYS PRICE AND BENEFITS

  • A successful ad is a successful ad

  • Everybody responds to humorous storylines

  • Prioritize universal drivers over cultural nuances


MULTICULTURAL DRIVERS PRICE AND BENEFITS

Asian Americans like product features

46%

85%

OF BOTTOM ADS DON'T DISCUSS FEATURES

OF TOP ADS DISCUSS

PRODUCT FEATURES

* Likability Index versus average Asian Ad likability


MULTICULTURAL DRIVERS PRICE AND BENEFITS

African-Americans respond to humor

42%

96%

OF TOP ADS ARE

HUMOROUS AND RELATABLE

OF BOTTOM ADS ARE NOT HUMOROUS OR RELATABLE


MULTICULTURAL DRIVERS PRICE AND BENEFITS

Hispanics prefer family references

41%

95%

OF TOP ADS

FOCUS ON THE FAMILY

OF BOTTOM ADS DON'T FOCUS ON THE FAMILY


TOP PERFORMING PRICE AND BENEFITS

GENERAL AD

RESULTING IN

41%

INCREASE IN HISPANIC MARKET SALES


Key trends that will impact behavior1
KEY TRENDS THAT WILL IMPACT BEHAVIOR PRICE AND BENEFITS

Increasingly Multicultural

Older but Wiser

Stagnant Population

Increasingly Urban

Declining Families

Smaller Households


You need to adjust to accommodate different shopping and product preferences
You need to adjust to accommodate different shopping and product preferences

It’s an age AND it’s an attitude

This Not this


Know the difference between age groups and generations
Know the difference between product preferences age groups and generations

Seniors Today

Seniors Tomorrow

  • More traditional

  • Less technological savvy

  • Conservative values

  • Conservative tastes

  • Requirements, conditions & ailments related to age

  • Less traditional

  • More technological savvy

  • Less conservative values

  • Willing to experiment

  • Requirements, conditions & ailments related to age

Different

People

Same

needs

Consumer

Patient


KEYS product preferences

TO

GROWTH

  • REACH: An increasingly economically divided consumer

  • CONNECT: With consumer need states

  • LEVERAGE: The redefinition of value

  • TARGET: Economically powerful consumer segments

  • UNDERSTAND: New viewing habits



Using new and traditional ways
USING NEW AND TRADITIONAL WAYS product preferences

DEVELOPED

3.5

Hours

21% of North Americans

have TV’s with internet connection

+

DEVELOPED

74%

Internet penetration

Source: Nielsen Global Survey Q3 2011


Cross platform viewing gaining
CROSS PLATFORM VIEWING GAINING product preferences

  • Average TV viewer is watching 6 fewer minutes per day of traditional television

  • Viewing is shifting to other devices, including to tablets. (Current penetration is 15% of US homes)

  • Nearly 36 million mobile phone owners in the U.S. watch video on their phones.


Leverage simultaneous usage
LEVERAGE SIMULTANEOUS USAGE product preferences

86% tablet owners and 84 % of smartphone owners use their device while watching TV

  • 44% of simultaneous tablet+TV viewers visited a social networking site during the program

Source: Nielsen Q2 2012 Connected Devices report



Social ads generate a 55 greater lift in recall
SOCIAL ADS GENERATE A 55% GREATER LIFT IN RECALL product preferences

Consumers will provide their personal information for:

52% Opportunity to save

37% Free service or app.

36% Exclusive information

33% News of interest

26% Charitable purpose


FOR OUR INDUSTRY…WHAT ARE CONSUMERS product preferences WILLING TO DO ON SOCIAL MEDIA?

Consumers are willing to get more involved

Source: 2011 Nielsen PanelViews Media Survey - Individual responses - Canada


Completely Completely/somewhat product preferences

Recommendations from people you know 28% 91%

Consumer Opinions posted online 9% 70%

Editorial Content (Newspapers) 7% 59%

Friends

&

Family

Completely Completely/somewhat

Brand Sponsorships 7% 47%

TV Ads 6% 48%

Radio Ads 5% 43%

Newspaper Ads 6% 46%

Magazine Ads 6% 47%

Ads before movies 4% 41%

TV product placements 5% 41%

Outdoor billboards 4% 46%

Traditional

Media

Completely Completely/somewhat

Branded websites 9% 57%

Emails I signed up for 6% 50%

Ads in search engine results 5% 40%

Online video ads 4% 36%

Online banner ads 4% 33%

Ads on social networks 4% 36%

Txt ads on mobile phones 3% 29%

Display Ads on mobile devices 4% 33%

New

Media

TRUST IN A SOCIAL MEDIA WORLD

Source: Nielsen Global Online Consumer Confidence Survey 3Q2011


Economic outlook
Economic Outlook product preferences

WHAT’S

NEXT?


U.S CONSUMER IS CAUTIOUSLY OPTIMISTIC ABOUT THE FUTURE product preferences

DO YOU THINK YOUR COUNTRY WILL BE OUT OF A RECESSION IN THE NEXT 12 MONTHS? % SAYING YES

Most

Optimistic

Source: NGCCI

Source: Nielsen Global Omnibus Consumer Confidence Survey 1Q2012


Looking forward coping mechanisms remain consistent
LOOKING FORWARD, COPING MECHANISMS REMAIN CONSISTENT product preferences

WHEN ECONOMIC CONDITIONS DO IMPROVE, WHAT DO YOU EXPECT YOU WILL CONTINUE TO DO……

Save on gas 51%

Reduce take-out 35%

Less on apparel 31%

OOH Entertainment 29%

Save on groceries 28%

Source: Nielsen Global Omnibus Consumer Confidence Survey 2Q2012


The consumer is in control
THE CONSUMER IS IN CONTROL product preferences

Brands

Retailers

Consumer


Success relies on even greater collarboration
SUCCESS RELIES ON EVEN GREATER COLLARBORATION product preferences

Collaboration

Trust

Loyalty


The new consumer economy what to watch and what to do1

The New Consumer Economy: product preferences What to watch and What to do

James Russo, Nielsen


ad