How To Reach The Recession-Proof Consumer

How To Reach The Recession-Proof Consumer

Few Americans have been untouched by the economic downturn gripping the country. But how we respond varies widely by demographics, according to a Nielsen study. Understanding how we differ in the ways we cut back can create opportunities for manufacturers and advertisers.

Nielsen created eight segments that divided households into groups based on their behavior and reaction to the decline.  Despite conventional thinking that these segments are based primarily on income, characteristics such as age, household size and location were important factors in determining groups based on how they cut back expenses.

Eight Household Groups To Watch In A Recession

  • Recession Indifferent – those who do not alter their purchasing habits at all
  • Recession Insensitive – those who will cut back on luxuries such as entertainment and dining out
  • Switch to Private Label – younger, larger households that will buy generic brands or store labels
  • Light Coupons & Sales – typically older and smaller households that will take advantage of discounts and promotions
  • Stock-Up & Save – “empty nesters” who tend to remain loyal to name brands, but will depend on coupons and sales to stock up while they can
  • Switch Stores for Best Deal – typically urban consumers who are willing to shop around for the best prices
  • Brand Disloyal/Promo Sensitive – will easily switch from name brands to generics or sale brands for the best deal
  • Panic Stricken – those who will greatly reduce living expenses in all categories and do whatever they can to save money

Advertisers can reach the least-affected segments by understanding what media these people consume.  For example, “Recession Indifferent” consumers tend to view sports and news programming while “Recession Insensitive” consumers prefer comedy and quiz shows.  By targeting and reaching an audience based on their purchasing habits during difficult economic times, marketers can make the most effective use of their ad spending.

To learn more about how to effectively reach optimal audience segments for your products, read more about Nielsen’s segmentation analysis in the current issue of Consumer Insight.