Advertising to the consumer amidst the cost of living crisis

Written by Reece Jenkinson, Media Planner

It seemed as if the world was just settling into the ‘new normal’ when the cost of living crisis hit the UK- and now as marketers, we must ask ourselves whether this sudden change has affected the new normal? As marketers, we understand the necessity for adaptability from a media buying prospective, but it’s time to consider the effects of the rising cost of living through the eyes of the consumer.

With costs of basic necessities on the rise and wages at a standstill, research by Global has found that people have had to make decisive choices and revaluate their priorities, with 86% of people saying they have been personally affected by the rising cost of living; 75% of which have had to make changes to the way they are living.

Between buying cheaper food brands and challenging their own beliefs, people are looking to find value in every purchase where they now consider things like heating the house and fuel prices too expensive, which is resulting in an +300% increase on enquiries for solar panels, and 23% of drivers looking to buy a hybrid / fully electric car in the near future.

VALUE FOR MONEY DOESN’T MEAN CHEAP

In overcoming the pandemic, consumer beliefs have changed and people are beginning to consider the lasting effects of a purchase, rather than just the cost. Although a lot of the country is struggling with the rising cost of living, people’s priorities place expenses such as TV Subscriptions as a main priority as this provides entertainment, distraction and escapism for the whole family. 42% of households have 2+ TV Subscriptions with 52% intending to hold on to them for as long as possible. Closely following TV Subscriptions are Days Out and Holidays as these provide life time memories rather than a temporary, short term influx of serotonin. Speaking of holidays, the intent to get away is the 3rd top priority for people living in the new normal, as 43% of people have a holiday booked for this year, and 31% of people are willing to sacrifice other desirable goods to ensure they get away this year. Additionally, with mental health concerns on the rise over the past couple years, getting away on holiday is considered to be important to an overall 40% of travellers staying healthy in both body and mind.

Below is a closer look at our audience age group and consumer changes they’ve made since the cost of  living increased:

18 – 24s:

54% Switched to cheaper food brands

46% Turned their heating down / off

42% Stopped impulse purchasing

38% Cooked more from scratch

38% Searched for discount codes

35% Switched to cheaper beauty brands

65+

84% Turned their heating down / off

56% Reduced car journeys

56% Switched to cheaper food brands

53% Stopped impulse purchasing

49% Cooked more from scratch

49% Shop around for a cheaper deal

FAMILIES:

60% Turned their heating down / off

56% Switched to cheaper food brands

52% Stopped impulse purchasing

50% Reduced no. of takeaways

48% Searched for discount codes

48% Cooked more from scratch

By adhering to these new consumer changes, there some more steps we can take to ensure we’re reaching our audiences:

BY MAINTAINING MARKETING SPEND

o   Brands who continue to advertise in an economic downturn win in the long term.

·         VALUE DOESN’T MEAN CHEAP

o   Understand what matters to your audience and build a brand identity that reflects this.

·         UNDERSTAND THE HIERACHY OF SACRIFICES

o   For your customers. Use this to inform your creative and moments you target.

·         REWARD LOYALTY IMMEDIATLEY

o   Nudge people to purchase by targeting action moments.

OVERALL, THE RISING COST OF LIVING HAS EFFECTED MARKETING

The rising cost of living has reshaped lives and marketing post-pandemic, leaving consumers more value driven and critical along their purchasing journey, therefore, it is crucial we take the above into consideration in order to create successful campaigns that resonate with our audiences in the new normal.

As advertisers, it is easy to stay informed and constantly expanding our knowledge on technology and trends, but it is just as important we keep in touch with our audience and the landscape we’re shouting into.