WITH THE "AMERICAN DREAM" IN JEOPARDY, BRANDS MUST SHIFT FROM 'LIFETIME VALUE' METRICS TO HELPING CONSUMERS CREATE 'A VALUABLE LIFE'

News provided by

Jul 20, 2022, 07:00 ET

New Reports from Horizon Media Indicate Consumers are Suffering Transformative Social and Economic Woes

NEW YORK, July 20, 2022 /PRNewswire/ -- Financial and social uncertainty—sparked by raging inflation, soaring housing prices, the COVID pandemic and the war in Ukraine—have become a reality for a majority of Americans and are expected to remain for some time, according to new studies by Horizon Media. What does this mean for marketers? They will need to respond quickly if they intend to not only stay relevant but ultimately survive in this change-is-the-new-constant environment.

The reports, Inflation Nation: The Status of The American Dream and How Brands Can Help, and Guidelines for Brands in Uncertain Times: Understanding the Psychology of Uncertainty and Loss, indicate that a new American Dream is emerging in which younger generations are reexamining their priorities and questioning traditional definitions of success. Economically, the average American consumer is now facing what the reports call "wallet lockdown" and are increasingly forced to sacrifice "wants" in order to ensure they can take care of their "needs."

"Millennials are increasingly coping with the notion that they will be the first generation who will not do better than their parents," said Maxine Gurevich, SVP, Cultural Intelligence of Horizon Media's WHY Group. "A revised American Dream has emerged on social media, one that deglamorizes the hustle to get ahead financially in favor of a simpler life."

The Horizon reports discuss this new mindset among American consumers and offer extensive insights and recommendations on what steps brands can take to address the issue.

"Brands need to take notice to restore people's faith through stability in pricing, an easy shopping and service experience, empathy for customers' psychological outlooks, over-communication, and demonstrating their values to make a positive impact on the world – not just sell product," said Gurevich. "CMOs need to pivot part of their metrics from getting lifetime value from consumers to giving their customers a valuable life."

INFLATION NATION
Here are some key insights from Inflation Nation: The Status of The American Dream and How Brands Can Help on what brands can do to help consumers meet the challenges posed by a new economic and social environment:

Tailor messaging to psychological outlooks. Consumers' optimism or pessimism about the future is key to how they perceive of and react to inflation.
Boost rewards. Brands can focus on rewards in some of the most painful categories, for example gas rewards for grocery purchases or bonus airlines miles.
Reward buyers with simple pleasures. With people sacrificing small joys in order to address pain points, brands can focus on rewards that deliver "simple pleasures" like a product bundle that provides the tools and ingredients to cook an international-inspired meal at home.
Deliver frictionless deals. Not everyone has time for bargain hunting, and brands can leverage AI technology to help shoppers make smarter decisions by serving up reactive pricing that's in line with their spending.

GUIDELINES FOR BRANDS
Guidelines for Brands in Uncertain Times: Understanding the Psychology of Uncertainty and Loss provides a path to help marketers navigate today's dynamics and help customers navigate an emotionally and psychologically stressful time.

"By utilizing the science behind consumer psychology and behavioral economics, we can provide more actionable and effective avenues for brands," said Sheri Roder, EVP, Chief of WHY Group. "The strongest strategies will be based on the subtle nuances of what drives people to act at a time when any action or spending seems fraught with uncertainty. How can a brand give their customers a feeling of control or lessen their uncertainty? How a brand responds today will reap tangible future benefits, as we know that people tend to value and stick with brands that they feel 'get them' and care about them."

Insights from the report include:

Buyers want emotional support as much as they need price support. Brands need to demonstrate empathy and transparency.
Consumers need a narrative that reframes familiar prices into "gain stories" instead of "loss stories."
Customers are still looking for pleasure, gratification, and bigger picture payoffs, even in the face of difficult economic conditions. Brands need to give consumers a reason to engage beyond their core product or service.
Consumer attitudes about the future – are they optimistic or pessimistic – seem to have an overwhelming impact on how much psychological pain and price sensitivity they experience. Aligning with the views of these different segments, often for the same products and services, will be make or break.

The full reports can here accessed here Inflation Nation and Guidelines for Brands in Uncertain Times.

HORIZON MEDIA
Horizon Media, Inc, the largest U.S. media agency according to Ad Age Data Center 2022, delivers data-driven business outcomes for some of the most innovative and ambitious brands. Founded in 1989, headquartered in New York, and with offices in Los Angeles and Toronto, the company employs 2,400 people and has media investments of more than $9 billion. Horizon Media's fundamental belief is that business is personal, which drives its approach to connecting brands with their customers and engaging with its own employees resulting in industry-leading workplace satisfaction levels (Glassdoor). The company is consistently recognized by independent media outlets for its client excellence and has earned several "Best Workplaces" awards reflecting its commitment to DEI and the life and well-being of everyone at Horizon Media.

SOURCE Horizon Media