The Great Recession has redrawn the American consumer map into four groups:
Steadfast Frugalists, Involuntary Penny-Pinchers, Pragmatic Spenders and
Apathetic Materialists
CHATHAM, N.J., Nov. 16 -Four distinct consumer segments are emerging from
the Great Recession, according to a new study, entitled “Marketing to the
Post-Recession Consumers,” by marketing strategy and research firm Decitica
(www. decitica.com) The four consumer segments , which promise to redraw the
brand landscape are: 1. Steadfast Frugalists, 2. Involuntary Penny-Pinchers,
3. Pragmatic Spenders and 4. Apathetic Materialists.
Dr. Val Srinivas, principal at Decitica, stated, “This research decisively
shows that marketers need a fresh lens through which to view consumers in
the post-recession world. Marketing strategies that ignore the diversity of
consumers’ recession experiences will not have the desired potency.” These
four categories were derived by analyzing the frequency, satisfaction and
the self-efficacy associated with a variety of spending, purchase and
consumption behaviors.
Steadfast Frugalists
Steadfast Frugalists are committed to self-restraint, engaging in prudence
with unequivocal enthusiasm. They make up about one-fifth of the American
consumers, representing all income and age groups.
“Marketers will find this group to be the most challenging, as they are the
least brand loyal and most likely to discount marketing messages,” notes Dr.
Srinivas.
Eighty-percent of Steadfast Frugalists say the new behaviors they have
adopted will likely stay with them for a long time. This is in contrast to
twenty-four percent of Apathetic Materialists who feel this way.
Involuntary Penny-Pinchers
Involuntary Penny-Pinchers, about twenty-nine percent of the population,
have been severely affected by the recession. They are mainly made up of
households with less than $50,000 in income, with more women than men.
This segment has been forced to embrace thrift like never before.
Presently, their actual behaviors do not differ widely from those of
Steadfast Frugalists. Where they drastically diverge is in their aversion to
expending effort in money-saving strategies. Only seventeen percent find
buying store or generic labels to be satisfying, compared to fifty-nine
percent of Steadfast Frugalists.
Also, the recession has had a heavy emotional impact on Involuntary
Penny-Pinchers; they admit to being more scared (seventy-seven percent),
stressed (eighty-one percent) and worried (eighty-seven percent) about the
future than other groups.
Pragmatic Spenders
“Pragmatic Spenders are the most attractive group for marketers because of
their higher spending power,” says Dr. Val Srinivas. “While it is true that
they have also curbed their spending, they are the most capable, both
psychologically and financially, to willfully resurrect their past spending
patterns,” he added. This group comprises twenty-nine percent of consumers.
Income has blunted the effects of the recession on this segment. Only
twenty-eight percent of Pragmatic Spenders feel the recession has changed
what and how they will buy in the future, compared to fifty-five percent of
Steadfast Frugalists.
Apathetic Materialists
Apathetic Materialists seem least changed by the recession. They have not
embraced the new frugality to the same extent as others and get minimal
satisfaction from such behaviors. Only about six percent in this group find
price comparison to be satisfying, in contrast to eighty-five percent in the
Steadfast Frugalists camp.
The Apathetic Materialists segment has more men (fifty-five percent) and
younger consumers (seventy-two percent are below the age of forty). They
are the least driven by price: only eight percent admit to being very
focused on value compared to thirty percent of Pragmatic Spenders and
fifty-two percent of Involuntary Penny-Pinchers.
Table 1
Satisfaction from Frugal Behaviors and Self-Confidence in Practicing
Restraint
Data shown for select items. Total Steadfast Frugalists Involuntary
Penny-Pinchers Pragmatic Spenders Apathetic Materialists
Percent Who Find each Activity “satisfying”
Buying on sale or using coupons 40 87 37 34 11
Buying store labels 22 59 17 15 6
Shopping at discount stores 29 77 24 19 8
Surfing the Internet for coupons and discounts 30 73 24 24
10
Comparing prices before purchase 35 85 32 26 6
Percent Who are Highly Confident in their Ability to Practice
Restraint
Resisting the temptation to spend now and worry later 53 87 46
73 5
Saving money 35 70 18 54 5
Sticking to budget 44 87 46 73 5
Survey Methodology
Decitica engaged OTX Research to conduct the survey online between August
5-12, 2009 among a sample of 1,055 individuals spanning various income and
age groups.
More information…
http://www.decitica.com
