Navigating the New Consumer Realities

Despite assurances by many governments that an economic recovery is under way, most consumers continue to feel apprehensive about the future—more so than they did before the downturn. The slight uptick in confidence over the past two years has leveled off and in some cases retreated, as a string of global crises—the massive earthquake and tsunami in Japan and unfolding unrest in the Middle East—drown out news of modest economic progress. Consumers have come to accept instability as normal, and this attitude is affecting their feelings about spending across most markets. Yet natural disasters and political turbulence aren’t the only factors bringing about change in consumers’ spending habits. The emergence of a middle class in developing markets and advances in digital technology are introducing new shopping behaviors that have significant implications for both retailers and their suppliers.

Over the past three to five years, The Boston Consulting Group has been tracking four of the most important developments in the consumer industry: the increasing relevance of new markets, changing shopper demographics, the rise of new shopping channels—especially the Internet—and, finally, trading up and down and the shift from conspicuous to “conscientious” consumption. This report brings hard data on these new realities and their impact across markets and categories. ¹ 1 The latest edition of our annual consumer survey, taken in March and April 2011, was based on original research to capture spending trends in 21 countries around the world. As in previous years, we tracked consumer behavior in Brazil, China, India, Mexico, and Russia, as well as in Canada, Japan, the U.S., and several European countries (France, Germany, Italy, Spain, Switzerland, and the U.K.). New to the survey this year are the markets of Australia, Denmark, Finland, Greece, Norway, Sweden, and Turkey. After adjusting our data to exclude the bottom quartile of income, we surveyed approximately 24,000 consumers. Notes: 1 The latest edition of our annual consumer survey, taken in March and April 2011, was based on original research to capture spending trends in 21 countries around the world. As in previous years, we tracked consumer behavior in Brazil, China, India, Mexico, and Russia, as well as in Canada, Japan, the U.S., and several European countries (France, Germany, Italy, Spain, Switzerland, and the U.K.). New to the survey this year are the markets of Australia, Denmark, Finland, Greece, Norway, Sweden, and Turkey. After adjusting our data to exclude the bottom quartile of income, we surveyed approximately 24,000 consumers. We also discuss how consumer companies can anticipate changes to their business and so secure an advantage from understanding new patterns of trading up and down and serving new kinds of consumers.