The "Affluenza" Epidemic
Consumers are buying fewer things, but (in their minds) better things. How can your product or service be repositioned to meet both the wants and needs of today's consumer?
Lifestyle gurus like Martha Stewart, B. Smith and Colin Cowie have convinced millions of people that living well is not just for the wealthy. The result is the consumer who wants the best but may well be on a budget.
Savvy retailers cater to this faux affluent customer by offering high-end products at affordable prices:
- Giorgio Armani is designing bridge lines
- Target sells 200+ items by renowned architect Michael Graves
- Home Depot sells Ralph Lauren paint
- Supermarkets offer gourmet meals in the frozen food aisle
While this desire for luxury, elegance, and beauty appears to be at odds with the downtick in consumer spending since 9/11, it is actually on a parallel course. Here's why: Long before the terrorist attacks, many Americans had reached the saturation point for consumer goods and services.
"American consumers have become overstuffed," said consultant Wendy Liebmann in an address at the annual Retail Advertising Conference. "After half a decade of frenzied shopping, Americans have run out of things to buy. Still, they will eagerly try a new store or a new format in the hope of finding that something different, something intriguing, something worth spending their money on."
Today, we have a massive infrastructure (malls, discounters, club stores, e-commerce) serving a smaller population of frequent shoppers. For many, shopping is no longer just mindless acquisition. Consumers are buying fewer things, but (in their minds) better things. They filter their decisions through their evolving personal standards for quality, function and form.
How can your product or service be repositioned to meet both the wants and needs of today's consumer?
Seena Sharp authored the recently published Competitive Intelligence Advantage: How to Minimize Risk, Avoid Surprises, and Grow Your Business in a Changing World (Wiley). She founded one of the first competitive intelligence firms, Sharp Market Intelligence, serving clients from Fortune 500 firms to those whose names are unfamiliar – throughout the US, Europe, Asia and Africa. She speaks to business groups globally and has published numerous business articles.