Maybe it’s my job, maybe it’s just me. But I seem to be having the craziest of conversations about the state of the consumer economy. It never fails to amaze me how, at very senior levels of management, people jump to the oddest of conclusions.
Somebody’s complaining that the cellular subscriber isn’t spending any more than last year. The sales of somebody else’s brand of cigarettes, or instant noodles, or shampoo is down. Amazingly, the universal culprit of choice is the consumer. It’s all his or her fault. Either they aren’t spending as much as before or they’re spending on other things. Those are the common explanations for a brand’s lack of growth. What’s wrong with the economy, is the usual question. Is it that too many are spending too much on eating out, on cellular phones, on motorcycle loans, on holidays? It would seem that the people asking these questions are either oblivious to the truth or they’re creating a smokescreen to mask it.
Here are some simple facts that are worth remembering. Like unemployment, which is down. Like wages, which are up. Like Consumer Confidence, which is up. Not surprisingly, the sales and consumption of just about every type of product and service is up. There are a few exceptions, like instant noodles, cigarettes, or lipsticks. Anybody who bothered to tried to uncover the truth would see that Indonesians are increasingly more health-conscious, they are eating and drinking better foods and beverages, shopping more at “modern trade” outlets. But they are also increasingly becoming more conservative, not liberal. These are the facts, not my opinion. Facts gathered not just in a handful of this large country’s metros, but from 21 of its major cities, many of its towns and many of its villages as well. These facts are too often ignored by too many city-centric marketers, who find it difficult to comprehend that their millions of humble consumers can change their habits, make aspirations come true, switch their choices. Where ignorance is bliss. Make that peril. How hard is it to believe that people trade up when times are good, trade down only when times are bad? Times are good right now, never been better.
Why are some marketers complaining? Marketing and advertising folks are trained to be good at spin, many are particularly adept at shifting the blame to someone else. If it isn’t the economy, it’s the consumer. If it isn’t that easy to pin the tail on the donkey, then it must be the minions in sales, or the factory, or logistics. Anybody but the folks in marketing and advertising. Too often, they are the people who miss the woods altogether, not just the trees for the woods.
Let me change analogies. A veteran who’s spent a few years in the marketing battlefield would readily agree that a sniper’s rifle is a much more appropriate weapon to aim at a target, rather than a shotgun. Better prospects of hitting the target hard, with no collateral damage. If you have read about snipers, or talked to one, or seen the movie, you would know that a good sniper needs to see the big picture in detail, before he puts his eye to the telescope. He needs to see the weather, the traffic, the windows, the passers-by, the comings and goings, not just the target. If he doesn’t, a flashing billboard, a passing cloud or a busy secretary can hide the target. And so it is with understanding your consumer.
A consumer isn’t just a wallet, a mouth, a body, or buttocks on a seat. As David Ogilvy was fond of saying, “the consumer is not a moron, she’s your wife”. If you care to watch, societies change, trends change, people change. That includes your wife, or your husband, not just your son or your daughter. If a marketer isn’t watching these trends, if she’s got a shotgun in her hand or his eye only on the telescope, there’s a very good chance the target will get away. You need to see the big picture, before you look at the small pieces of the puzzle. Here’s an example. If you look at the shampoo market in the last two years, a clear picture emerges. More people are buying shampoo today, more users have a “Brand Used Most Often”.
As the chart illustrates, brands at the low-end of the market are travelling flat. At the higher end, Procter & Gamble’s Pantene is racing upwards with more loyal users joining the fold. Unilever’s Dove is growing too, but at a snail’s pace, trapped by its older target audience in a young country. The same company’s Sunsilk suffers from a similar malaise, an older brand used by older women with not enough young ladies adding to its ranks each year. And so Unilever has a problem. The market’s trading up, the bottom’s flattening out. With costs rising, the better margins are upstairs where their brands aren’t getting enough traction. Look at toilet soaps and a similar picture will emerge. Move on to instant noodles, or cigarettes, or carbonated drinks and you won’t get too different a story.
The situation has little to do with the economy, the sales guys, or the folks at the factory. It has everything to do with the marketing guru’s understanding of the changing consumer, a holistic view of an ever-changing society. It has a lot to do with using a shotgun instead of a sniper’s rifle. It is symptomatic of tunnel vision, looking only at sales figures and demographics, without giving enough time or attention to the consumer’s mind, the consumer’s societal context. Nobody can understand consumer behavior by studying pack sizes or witnessing a handful of focus group discussions. My favorite of slogan is one created by and for an advertising agency, one I have never worked for. That’s “Truth Well Told”, from McCann. That’s about as good as it gets. The truth, in marketing, starts and ends with how well you know the consumer. The changing consumer.
These observations are based on Roy Morgan Single Source, the country’s largest syndicated consumer survey with over 25,000 respondents annually. The insights are gathered from across the country and projected every 90 days to reflect the views of 90 percent of the population, 14 years of age and older.
The writer can be contacted at debnath.guharoy@roymorgan.com
