Unprecedented changes in consumer behavior lie ahead, says Deloitte report
Consumer 2020: Reading the signs
* Dr. Ira Kalish, Director of Consumer Business for Deloitte Research, part of Deloitte Services LP in the U.S.
* Alison Paul, Vice Chairman and Retail Sector leader, Deloitte LLP
* Lawrence Hutter, Global Head of Consumer Business, Deloitte Touche Tohmatsu Limited
The convergence of economic, demographic, and technological forces will bring about unprecedented changes in consumer behavior, according to a new report from Deloitte Touche Tohmatsu Limited (DTTL), Consumer 2020: Reading the signs. The report, which was presented at the National Retail Federation in New York today, draws together insights into economic and demographic trends, considerations of finite resources and sustainability, and the ever- more dramatic impact of technology on our daily lives. The report also includes predictions about how consumer attitudes and patterns of consumption will change over the next decade.
Global economic rebalancing
The report posits that over the coming decade we will see a rebalancing in the global economy, as countries that previously saw economic growth that was fueled by heavy borrowing and excessive consumer spending move to an era of export-driven growth. Conversely, countries whose growth came from exporting to borrowing countries will no longer be able to rely on such markets. Countries such as China will shift away from export-oriented growth toward growth driven by domestic consumer spending.
This fundamental change in the structure of the global economy will shift the manner in which retailers and brands obtain growth. In the U.S. and Western Europe, this means growth will most likely come through market share gains rather than by simply latching on to a growing market. For countries like China and India, this adjustment means taking measures to stimulate consumer spending, such as liberalizing consumer finance or improving social security in order to discourage saving.
At the same time, the world faces significant demographic challenges. While Europe faces losing 60 million people over the next five decades, India is on course to surpass China as the world’s most populous country by 2030. Africa’s population is forecast to nearly double from 1 billion in 2009 to 1.9 billion in 2050.
Rapidly developing economies will see a huge population increase within their middle classes, presenting an enormous opportunity for retailers and brands. However, such population growth will also place an added pressure on resources and the environment.
Communicating, connecting, and socializing
Methods of engaging consumers in adopting more sustainable behaviors or purchasing more products and services will no longer just be about marketing and communicating. Rather, customer engagement will be about connecting and socializing with them. Consumers now have the power of information at their fingertips, enabling them to comparison-shop and make purchases anytime, anywhere. This trend is likely to accelerate, as mobile communication is expected to be an ever-larger transformative technology in the future, as it provides independent access to information.
Trust will remain a key issue with consumers, who will continue to trust peer recommendations over company information. Additionally, the sense of customer loyalty that existed in previous generations will be more short-term and influenced by social networks.
Dr. Ira Kalish, Alison Paul, and Lawrence Hutter are available for commentary and further discussion about this report. Please contact James Igoe on +44 20 7303 8247 (firstname.lastname@example.org) or Christine Selph at 212 492 4517 (email@example.com).
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