Consumer Behavior during Crisis: a tall order for Advertisers (Part 2)

by Ronald Jabal

Evolving tastes in brands

The PSRC survey also tracked changes in consumers’ behavior across product categories revealing important insights to evolving preferences during less-than-ideal environment.

During crisis periods, Pinoys are kicking the habit of “going-solo” in paying for beer sessions with friends. Instead, sharing and dividing the costs of beer consumption are becoming the order of the day.

Even the choice of the place where they enjoy their favorite beer brand changes as they drink more at home or in cheaper places – forgetting for a while the flashy beer gardens they used to go to for night-outs. PSRC said 38% of consumers are likely to switch brands while 37% reduces the number of beer bottles they consume.

Pinoy smokers also feel the pinch as they reduce “puffs” of their favorite brands. They buy by the stick than by packs. They also are now more considerate of prices among outlets with some going out of their way just to get cheaper cigarette sticks.

The PSRC survey discloses that, in times of crisis, 28% of smokers switch brands while a staggering 57% reduces quantity.

As regards home care products, more and more Pinoys are showing very discriminating tastes scouring the market for more efficient and multi-purpose products that are suited for their basic needs.

In times of crisis, some are products and being considered unnecessary and a number of consumers are aggressively looking for promos. Some 42% of those surveyed says they switch brands while 43% reduce number of home care products in difficult times.

Tech-savvy consumers are also rethinking their purchases of electronic gadgets. Gadgets are fast becoming “on a need “and on an “exact-specs please” basis only replacing the “must-have-coz-my-friend-has” era. Gadgets that contain and promote multi-functionality, cheap and bundled with a lot of freebies are the current preference.

In the period of “tight-budgeting”, 33% is switching brands and 50% is reducing purchases of electronic gadgets.

The consumer behavior around telecom services is quite similar to behavior in gadget purchases. More users tend to be open to changing their habits. They limit the amount of use of phone for calls/ SMS. They downgrade plans; do not go beyond free minutes/SMS, use multiple SIM cards, and are switching from postpaid to pre-paid schemes t better control consumption.

Promos on free or unlimited calls/ SMS are most appealing. More than half (55%) of consumers switch brands and also more than half (53%) reduce purchase of telecom services.

Expectedly, behavior around food and beverage and personal care products are changing. Pinoys cut their consumption of soft drinks; eat less or in cheaper places; pay attention to amount purchase and are now likely to bring home “doggy” bags”.

Unlike before, people bring home unfinished food when eating out. While 36% switch brands, 51% reduce quantity of purchases in food and beverage category.

As to preference and purchases towards personal care products, Pinoys are more prudent in product purchase and consumption. ”Bottoms up” i.e. finishing all the contents before throwing out is becoming the norm among consumers. Shockingly, Pinoys are using products less frequently to save on purchases.

The “tipid” mentality is all over the place even as they pursue products that offer good promos. In crisis periods, 39% switches brands while 47% reduces the number of personal care products.

There is also a marked change in the behavior of consumers in the light of increasing fuel prices. More and more people plan trips and errands to save in gas. They use car less and more people are re-discovering commuting to and from the office.

Even driving habits are being changed to adapt to highly volatile fuel price environment. In purchasing fuel, 35% of Pinoys switches brands while 46% reduces quantity.

Esteban believes the key lesson that advertisers should learn from these is very basic- knowing their consumers really, really really well.

“Immersion with your consumers is a quick and insightful way of understanding the coping behavior of your consumers. In times like this, there is a need to redefine value in your category: absolute amount in relation to pack size, cash poor vs. cash rich segments, “Esteban said, even as he reminded PANA members that recessionary periods are rich in innovations.

“Consumers are willing to adapt new products, and companies are and will be forced to innovate to survive,” he added.

He ended his presentation with a clear message, “Promote, communicate value, heighten saliency and invest in marketing research”.