IN BLACK & WHITE | Aki Kalliatakis
Shifts like this require a catalyst and catalysts don’t come much bigger than a global recession. In the post-recessionary world, attitudinal change is confirmed by the return to popularity of wartime posters like ‘Keep Calm and Carry On’ and ‘Make Do and Mend’. Also making a comeback is the Great Depression saying, ‘Use it up, wear it out, make do or do without’.The slogans resonate with millions of South Africans who have to cut out luxuries like expensive gifts, regular restaurant visits, long holidays and fancy gadgets. Some even cut out necessities (school uniforms, staple foods and personal transport). Shifts like these create winners and losers.
Early in the global financial crisis, US media highlighted the businesses that were doing well. They included shoe, clothing and appliance repair companies and those selling pirated music.In a much-changed environment, people are unwilling to pay for things they don’t need. They may need a new car, but will opt for manual rather than electric windows. Premium purchases are re-examined and major brands can be affected. When Coca Cola temporarily ran out of carbon dioxide, sales were permanently impacted as consumers decided they actually liked non-premium alternatives.
Meanwhile, ‘Needless Markup’ has entered the Urban Dictionary as slang for Neiman Marcus, a sour consumer reference to premium pricing at this upscale department store.Behavioural shifts can be dramatic. Some consumers stop buying vegetables and grow their own. Or they keep chickens or make items for sale at craft markets; DIY becomes MIY (make it yourself) and SIY (sell it yourself).The post-recession consumer can’t be conned by packaging trickery or changes offering zero benefit. Today, toothpaste-makers that widen nozzles in order that more goo oozes out per brushing session are unlikely to see smiling acceptance.
The voluntary simplicity movement ensures continuing interrogation of waste, needless sophistication and ‘added value’ that adds more cost.Costs can be avoided entirely by exploring simple alternatives. For instance, after years of getting a rash after shaving with shaving soap, I followed a friend’s advice and began shaving in warm water only. The only rash I now experience is a rash of savings by foregoing shaving soap.More broad-based self-sufficiency trends drive the shift to home-brewing. Web-based peer-to-peer lenders cut out the banks and families self-insure for life, medical and property protection.Home schooling, barter networks and buying cooperatives are all on the rise. Some even develop at-home power generation to escape Eskom. Developments like this threaten unresponsive businesses. However, huge opportunities beckon those that ‘get it’. Responsive post-recession businesses will offer genuinely better deals and find ways to simplify and thereby satisfy the customer.
They will build enduring consumer relationships by responding to real needs. They will create options that enable customers to obtain good value without cluttering the product with useless special features and levels of specification that affront canny consumers. Friendships forged in tough times last a lifetime. The same can be said of relationships with a business or a brand.
Prosumerism in Action
Create your own pop star by voting for the winner of this ITV show in which 10 000 wannabe stars were auditioned for the chance to win a record contract. Nine million viewers voted by telephone on the final sing-off between Gareth Gates and Will Young. Young became the Pop Idol. Three weeks later, he hit number one in the UK charts with the fastest-selling debut single of all time.
More than 1.1 million pop prosumers went out to buy the record of the star they had created.
Help design the jeans of the future, was one of the ideas that Levi's took to panels of hip young consumers in style capitals around Europe, including Milan, Berlin, Paris, and London. The iconic red-tab brand had become more famous for clothing 40-something men than trendsetting youngsters, and was in need of a brand makeover in order to rescue ailing profit margins.
Levi's executives developed the concept of engineered jeans.
The panels still take place around every six months.
Users of Nike's web site were invited to design their own shoe - picking colours and trim. They could also include a single word ID-tag on the shoe ordered over the web. But then, a student tried to put the word 'sweatshop' on his shoe. The company refused to carry the word and became embroiled in an e-mail conversation about its refusal.
The Nike site continues to be a success, but the anti-Nike e-mail appeared in newspapers and TV globally
Make your own TV messages. MTV is inviting viewers to send messages by text. The messages then pop up in little speech bubbles on the screen during programming. MTV Live, the broadband TV channel in Sweden and France, lets viewers assemble virtual environments and e-mail their creations for consideration as background images.
The channels have received thousands of messages and it's become a cult activity in Sweden and France.
Source: University of Alaska
Prosumers can't be CONNED but they can be Courted
Consumers don’t go soft in hard times. They toughen up and become resourceful – a phenomenon that has ambushed most South African businesses. Rather than adapt to this strategic shift, they throw old remedies at new challenges. Price pandemonium is one manifestation.
Companies engage in an orgy of special offers to drive sales that remain stubbornly flat. They then repeat this behaviour, vainly hoping for a different result – the classic sign of insanity. Future-spotter Alvin Toffler gave hints of the more challenging attitudes to come. He coined the word ‘prosumer’ to highlight an imminent blurring of the roles of producer and consumer as the public learned to create their own solutions rather than rely on readymade offerings.