My grandfather grew up during The Great Depression, and wouldn’t let you forget it.
One of his favorite stories involved receiving a baseball glove for his birthday. It wasn’t the one he wanted, and when he abandoned it, my great-grandfather squirreled the glove away and gave it to him again at Christmas.
Grandpa died in 1986. I heard his baseball glove story many times over the 14 years we had together, and while he usually told it in the vein of “you kids don’t know how good you have it today,” there was always a sad shame that rode along with it. His Depression-era stories made him seem ashamed of the frugality of the times, almost as if he bore some responsibility for the Great Depression itself.
Those of us who have been in marketing long enough to have marketed to people in the U.S. who lived through the Depression know that audiences in that age demographic often carried a seemingly stubborn frugality that permeated all of their spending habits. These were people who responded well to the promises of brands like Craftsman, knowing that if anything ever went wrong with a Craftsman hand tool, they could always bring it back for a replacement.
While U.S. economic conditions today may not be as dire as they were in 1929, there are some statistics that ought to frighten consumer marketers. In January, we found out that nearly six in 10 Americans couldn’t handle a $500 surprise expense. It’s not isolated to the U.S. only, either. Earlier this week, it was reported that more than half of Canadians were $200 away from not being able to pay their bills.
A product of these economic conditions is a trend toward frugal lifestyles. Perhaps driven by the social connectivity of the Internet as much as economic realities, many young people have developed a certain pride in adopting and sharing their tips for spending less and making their money work harder in challenging times.
Take Meal Prep Sunday – the notion of cooking the coming week’s worth of meals the night before the start of the work week in order to save money while eating healthy. Or Patient Gaming – enjoying new video games not when they’re newly-released and expensive, but when they’ve been around for months or years and can be acquired for a fraction of the cost. Or Buy It For Life, which focuses on durable products from companies that stand behind them. Hashtags related to these trends also relate closely to minimalist lifestyles, financial independence and even anti-consumerism, in some cases.
These trends should be alarming to consumer marketers who work on brands that might be premium-priced without a corresponding perception of quality, or brands that emphasize excess or conspicuous consumption. The U.S. recession may have spawned TV shows like “Extreme Couponing,” but the extended economic malaise has mainstreamed everything from “Tiny Houses” to “Design on a Dime” to “American Pickers.”
With lifestyle characteristics of younger Americans trending this way, it makes sense for marketers to think about appealing to the frugal mindset. Particularly when thinking about marketing to consumers that might be early in their careers or mired in college or credit card debt, emphasizing a product’s durability or lifetime warranty might be a stronger move than associating it with trendy celebrities or sports heroes. Marketers might also want to consider investing more in price testing, as price sensitivity might increase as target audiences skew younger.
Whatever the case, marketers should consider that attitudinally, young people have moved beyond simply pinching pennies. They’ve progressed to celebrating and sharing their strategies for surviving extended economic hardship. That has the potential to affect every single consumer category, especially considering the favored marketing lens of focusing on younger consumers, brand loyalty and lifetime value.