DYG's view of how consumers are winding their way through the recession

In a session called “What’s Next? Navigating the Economic Crisis,” an important speaker at this year’s ACT conference was Lee Boylan, senior associate at DYG, Inc.

Citing contractions in the economy, housing, and labor markets, Boylan provided a quick review of what has brought the consumer to her current state of mind, and asserted what she described as a corresponding shift in values. These value shifts include increasing personal responsibility and self reliance, thoughtful sacrifice, “smarts” (not intelligence, so much, as cleverness, or savvy), increased caution and risk reduction, and a more populist approach to their opinions (trust the opinion of people like me, over traditional authorities/information resources). The tendency toward thrift/frugality was seen as another shift attributable to recent economic turmoil, as well as a sense of essentialism (paring down, less is more), and choosing personal priorities over materialism.

Boylan offered a number of trends and attitudes that DYG considers responsive to these changing values:

Soldiering on. Consumers are responding to the economic storm with a sense of stoicism. (No matter what you throw at me next, I can handle it.)

Suspicion and scrutiny. The economic crisis has caused consumers to begin examining everything more closely, including the news, and virtually all purchase decisions. Homework is the name of the game, including research about coupons/specials, and long-term value on major purchases. A new premium is placed on knowledgeable, credible employees… and reviews found on social sites, through word-of-mouth, etc. 64% of consumers in a DYG survey said they’re striving to reduce risk.

Sobriety. “The race is on to abandon excess and frivolity, to strip away over-abundance and over-indulgence and get back to basics. Now it is coming a badge of honor to have something that is old and dated - no need to have the newest blackberry.” Consumers almost feel embarrassed to indulge in vast excesses.

Streamlining. The economic crisis is providing the impetus (excuse) to deal with super saturation. According to Boylan, there are 120 different choices when it comes to toothpaste at Walgreen’s. People are overwhelmed by all of these choices. Streamlining helps us cut-down on choice overload.

Status from self, not stuff. As economic life grows harder and status from materialism grows elusive, consumers are finding new sources of satisfaction… including their relationships, ethics, personal well being, health and appearance. According to DYG data, the percentage of people “feeling better about family relationships” is up 4% since 2005, hitting 60% in 2008 (the heart of the recession).

One example of “Status from self, not stuff,” is a phenomenon Boylan called “Parentensity.” Whether infants or 30-year-olds, parents continue to spend on their children… and seek ways of staying involved in their children’s lives.