Middle Class Retreat: Fickle Consumers

Megatrends

About This Report

Dec 2017

In their continuing struggle to maintain their economic status ever since the 2008-2009 global financial crisis, middle classes in developed countries focus on obtaining the most value for money and optimising their limited resources. The search for value – not just a ‘nice’ price, but also other intangibles such as quality, consumer experience, convenience, authenticity and more – has given rise to Fickle Consumers who are savvy, value conscious, and disloyal to brands.

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Middle Class Retreat: Fickle Consumers

Harder to connect to cash rich consumers

Post-recessionary middle-class consumers with more information and more choice than ever before, are becoming harder to connect with and are more fickle and less loyal to brands. They listen more to each other than to company messages when making buying choices.

Value driven purchasing decisions

Fickle consumers flit between brands in pursuit of value. Value is more important than price, as it also relates to other factors such as, quality, consumer experience, convenience, authenticity and novelty. These factors allow brands to stand out.

Product ownership becomes secondary

Product utility a product is more important than the ownership of it. They enjoy the convenience of subscription services even for big-ticket items, and want to experience more.

Technology as a gateway for connecting with consumers

While increased digital connectivity can discourage loyalty by making consumers better informed, it represents an opportunity for brands by offering new ways to communicate with target audiences. Mobile apps, virtual reality and augmented reality are among the most popular digital strategies.

Bricks-and-mortar remains relevant

Key to engaging consumers is offering a social, in-person experience. Players across a range of industries are devising innovative ways of connecting with consumers on a more personal level in a bricks-and-mortar environment.

Innovative business models revolve around key pillars of loyalty

Popular strategies to inspire loyalty range from educating and engaging consumers to expanding brand portfolios or offering subscription-based flexibility. However, all successful approaches must look to incorporate key focus areas of value, convenience, technology and uniqueness/exclusivity.

Introduction

Megatrend analysis at Euromonitor International
Megatrend framework
Middle Class Retreat is one of our eight focus megatrends
Key findings
Fickle Consumers: a key trend pertaining to Middle Class Retreat
Fickle Consumers

Who are Fickle Consumers

Why Fickle Consumers tend to be middle class
Knowledge is power
Challenges and opportunities

How to Win Fickle Consumers

Brand strategies centre around four pillars of loyalty
Inform and educate
Johnnie Walker: whisky education that leverages technology
Intelligentsia: immersing US consumers in coffee culture
Whole Foods: grocer educates customers on its core values
Brand portfolio expansion
LVMH: multi-brand online store offering special experience
Marriott International: global leader expanding its brand collection
Beiersdorf AG: narrow portfolio of brands hurts growth
Subscription services
HelloFresh : winning with convenience, flexibility, and value
Avenue A by adidas: curation , exclusivity and good value
Volvo: car subscription made simple
Consumer engagement
Capital One: creating a relaxed social environment
Nike: engaging directly with consumers and using augmented reality
Mastercard : priceless experiences and location-based engagement

Conclusion

Fickle Consumers: how to stand out from the competition
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