A new research study conducted by independent research agency HPI, in conjunction with Kitcatt Nohr, has found that although the UK has now been out of recession for nearly 12 months, consumers feel worse about their own financial and employment prospects than they did a year ago.
The study has found that although one fifth of all consumers feel insulated from the problems of the wider economy, even they have become more cautious in their consumer behaviour over the last year. As well as eating out less, giving less and doing more DIY, they are also keeping access to cash in case of emergencies.
HPI’s research indicates that this recession has been so deep and so scarring that a new kind of consumer is emerging: the “Coalition Consumer.” The Coalition Consumer is characterised by four factors:
Fearful about a constant threat of redundancy (themselves or others), the possibility of a double dip recession and a rising cost of living.
Taking greater care in deciding whether, and what to buy. Placing a higher value on things which are precious to them.
More savvy than in the past, determined not to go back to old, bad ways and benefitting from the internet and other information sources.
Using heuristics (shortcuts) to make decisions, happy to settle for excellent as opposed to the absolute best.
HPI has been tracking consumer attitudes to the recession since February 2009 using a nationally representative survey of 1,000 adults. The latest wave of research measured consumer attitudes following the recent government spending review. This research has been supplemented with a qualitative study for the purposes of this report.
Commenting on the study, Terry Prue, Senior Partner at HPI said; “Consumers have been deeply scarred – even the insulated ones. Their attitudes and behaviours will take a long time to change. Now more than ever, marketers need to follow the nuanced insights offered by behavioural economics rather than the one-dimensional ones provided by classical economics.”