Four ways the recent recession made consumers savvier

Sixty-eight percent of Americans now hold library cards, a record level. Marketing guru John Gerzema says this tells us a lot about the post-crisis consumer.

By all accounts, the economic crisis of 2008-2009 sent consumers scurrying for cover, victims of falling home values, tight credit, and generally fearful conditions. Right?

John Gerzema, chief insights officer for marketing giant Young & Rubicam and co-author of The Brand Bubble: The Looming Crisis in Brand Value and How to Avoid It, begs to differ with pundits and analysts that harp on the fact that today's consumer was victimized and traumatized by the recent economic crisis.

No, he says, if anything, the consumer has asserted and empowered him or herself even more forcefully than before -- and businesses need to sit up and take notice.

"It's not about the consumer being in retreat," he told attendees at the TED conference a few months back. "The crisis that exists today... has been tremendously powerful for consumers.... What we're seeing with consumers right now is the ability for them to actually lead us forward out of this recession. We believe that values-driven spending will force capitalism to be better. It will drive innovation. It will make longer-lasting products. It will create better, more intuitive customer service. It will give us the opportunity to connect with companies that share the values that we share."

He calls this "post-crisis consumerism," and sees four new values emerging as part of this shift:

"Liquid life:" Gerzema defines this as "the movement from Americans defining their success on having things to having liquidity," which is more nimble and flexible. This is an era of déclassé consumption, he says -- "the whole idea that spending money frivolously makes you look a little bit anti-fashion." He urges businesses to connect with this common-sense mindset. Frito-Lay, for example, discovered that their consumers had more money at the beginning of the month than at the end, so "they started to change their packaging. Larger packs at the beginning of the month, smaller packaging at the end of the month."

Ethics and fair play: The consumer is demanding empathy and respect, Gerzema says.  "Increasingly, consumers are looking at the culture of the company, looking for their conduct in the marketplace." Part of this equation is providing more transparency. Gerzemait talked about one of my favorite companies, W.L. Gore & Associates, which has been practicing enlightened management for decades. "Gore-Tex is all about personal accountability of their management and their employees, to the point where they really kind of shun the idea of bosses. But they also talk about the fact that their executives, all of their expense reports, are put on to their company intranet for everyone to see. Complete transparency."

Durable living: Consumers are more value-minded. "Witness the fact that Americans are holding on to their cars longer than ever before, 9.4 years, on average, in March. A record. We also see the fact that libraries have become a huge resource for America." Gerzema also makes a point that I was completely unaware of -- that 68% of Americans now carry a library card. "The highest percentage ever, in our nation's history." This trend reflect a growing thirst for knowledge, and is related to growth in demand for continuing education.  Another big trend -- the do-it-yourself (DIY) movement. "People are getting their hands dirty. They are rolling up their sleeves. They want these skills... the principle is there that it's about being sustainable and taking care of yourself."  The lesson for marketers, Gerzema explains, is that "what brands can do, and companies, is pay dividends to consumers, be a brand that lasts, offer transparency, promise you're going to be there beyond today's sale."

Cooperative consumerism: "Trust is not parceled out... It's now about connecting to your communities, connecting to your social networks.... Seventy-two percent of people trust what other people say about a brand or a company, versus 15 percent on advertising." He calls this emerging trend "cooperative consumerism" -- consumers working together to get what they want out of the marketplace. Gerzema urges companies to get out in front of the cooperative consumerism trend and become "community organizers." An example is Johnson & Johnson's Momversations, "a phenomenal blog that's been built up where J&J basically is tapping into the power of 'mommy bloggers,' allowing them to basically create a forum where they can communicate and they can connect. And it's also become a very, very valuable sort of advertising revenue for J&J as well."

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