Consumer Trends

Introduction.

If we are engaged in planning our service delivery over the longer term, then we need to have some idea as to what is likely to be demanded by the consumer in the longer term. Consumption plays an important role in the modern economy, as it provides the point at which social groups interact with the economy. Our purchases reveal a great deal about ourselves in terms of lifestyle, outlook, and attitudes. It is very rare nowadays for a purchase to be strictly utilitarian. This, in turn, means that Small Businesses have to keep a special view to demographic changes, as they will shortly reflect in changing patterns of consumer demand.

If the small business is working in the B2C sector (the Business to Consumer sector), then it is likely to have a keen eye for what consumer trends are likely to predominate in the next few years. Even if the small business were providing an offering for the B2B sector (the Business to Business sector), then it would need to have some view as to the likely demand patterns that would affect the clients and customers who are located in the B2C sector. For these reasons, it is important to have a view on the longer-term consumer trends if we are engaged in planning for the longer term.

As we are looking at the prospects of the Suffolk Small Business Community out to the year 2020, we felt that it would be important to give some consideration to the likely patterns of consumer demand over that period. If the future of the Suffolk Small Business Community is to provide a B2C offering, then we need to consider how markets are likely to develop during the study period. If the future of the Suffolk Small Business Community is to provide a B2B offering, then we also need to have a view of what the ultimate consumer will be demanding because somewhere along the value chain would be an ultimate B2C offering.

In examining these issues, we have tried to focus on the final point of consumption, as this will give us an idea of the type of business organisation that will be best suited to provide those goods or services. We have tried to avoid the issue of how the organisation will provide the offering as, in this section, we want to restrict ourselves to the issue of consumption as the point at which demographics comes into contact with the economy.

Consumption As Self-Definition

Over the past fifty years, there has been a substantial change in the way in which individuals interact with each other and society at large. In a “Post Modern” society, autonomy, and diversity have come to replace the authority, conformity, and hierarchy of society under Managerial Capitalism. People have come to judge themselves on their own terms and not the terms of others. This means that they act more as individuals and see others as individuals. This phenomenon is “The New Society Of Individuals”.

The new society of individuals is giving rise to a new model of consumption. The new approaches reveal new modalities in the expression of needs: the claim for sanctuary, the demand for voice, and the quest for connection – new interdependencies.

Capitalism follows the line of least resistance – it re-invents itself to fit the current realities. The new consumption is that which allows us to live an ever more individuated life. We are willing to buy our self-determination. However, this does not mean selling to an ever more differentiated market. Something new is needed. What is needed is a market for Deep Support. This is support in the invention and sustenance of a unique life.

These approaches manifest themselves in expressions of independence, self-control, and self-definition. They are transforming the market from being one in which goods and services are bought and sold (the transfer of transaction value) to being one in which relationship value is being released. Relationship value is released through a process of the Individuation of Consumption.

Managerial capitalism has helped to transform people from being “customers” into being “individuals”, who seek meaning from life as well as material comfort. We need to understand the New Society of Individuals because it will generate a New Enterprise Logic, the key to future wealth. The new values emphasize the rights of the individual and the importance of self-actualisation.

The Market For Dreams

The quest for self-actualisation is predominant in our consumption patterns. This has been expressed most eloquently as the “Dream Society”. The concept of the Dream Society arose from a consideration of what would come after the Information Society.

In many ways, the Information Society contained the seeds of its own destruction. The rise of the knowledge worker depended upon the development of information and communications technology. This same technology can be used to automate most routine Information Society work, much as most Agricultural and Industrial work has been automated away. This technological trend, in conjunction with the trend in off-shoring to cheaper labour markets in a quest to drive down unit costs, is leading to the demise of the Information Society.

In turn, the Information Society is being replaced with what has come to be known as the Dream Society. In the Dream Society, our purchases are an expression of our personal values, our self-identity. It is the story value that creates the added value in goods and services. The story value allows the providers to charge a premium for their goods and services. In the future, the successful companies will be those that can leverage the value added in the story value, by unlocking the relationship value that exists between them and their customers.

The emotional market underpins the Dream Society. Consumption will become a value statement, and the value statement will be encapsulated and embodied in the story of the products or services. The companies that will do well in the Dream Society are those that can leverage the story value in their goods and services and that can leverage lifestyle value as more important than value in use. The goods and services will allow spirituality to take precedence over materiality. The successful company will recognise storytelling as a core corporate skill as the raw materials of the Dream Society are stories, myths, and legends.

Critical Uncertainties.

If this is so, then the successful business community will be that which can assimilate a core of Dream Society businesses to form a cluster that reaches critical mass. The critical uncertainty facing Suffolk is whether or not such a cluster could be formed.

The evidence so far is mixed. On the one hand, Suffolk is not a creative centre and has a low incidence of Dream Society businesses. The existing population in Suffolk is seen as traditional, conservative, and inwardly focused; which argues against the development of a group of entrepreneurs who can leverage Dream Society businesses. On the other hand, the trends could be favourable to Suffolk developing this feature. The traditional Country Dwellers are in decline, Suffolk is attracting both the urbane and the Bohemian as residents, and the absence of a developed industrial heritage augurs well for the development of a post-modern small business sector.

In many ways, this is the critical uncertainty facing Suffolk. Can Suffolk develop a Creative Class by 2020? Will this Creative Class reach sufficient mass by 2020? Will the mix of businesses reflect the demand for Dream Society companies?

Consumer Trends

THE SUFFOLK SMALL BUSINESS PROJECT

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One of our Focus Groups examined the detail of the Consumer Trends that could be discerned to 2010.

Click here to go to that page.