There may be a rebound on the horizon for the current recession or as Microsoft CEO Steve Ballmer says, there's going to be a "fundamental economic reset" which would require marketers to revisit their target audience and marketing communications.
Based on results from Media Atlas between Q4 2008 and Q1 2009, Steve Garton, global head for Synovate media research, observed that financially pressed consumers are exiting the target audience to drive many categories more upscale.
He said this posed key issues for marketers to re-think their current target audience, the company's brand health and changing consumer media habits as well as what marketers should do about their marketing communications.
Garton said there is a loss of momentum in consumer spending such as in retirement plans between the period of Q3 2008 and Q1 2009, which dropped from 26.3% to 23.1%.
Demand for jewellery that costs $4,000 per item also decreased from 28% to 26% and those between 15 to 64 years old that were spending on jewellery was down from 32% to 25%.
Garton said the results showed jewellery is no longer an essential item to purchase.
In skincare, spending has taken a hit, down from 57% to 51% but the core audience that remained actually spent more from $709 to $752 with similar observation in perfume, cologne and air travel categories.
Garton said in areas where ownership is not dependent on short-term purchase cycles or people don't want to sacrifice yet, is holding steady.
While insurance spending has gone down overall from 59% to 55%, either because consumers let it lapse or not renew their policies, mean spending has gone up in higher income brackets.
Garton said in a backdrop of different purchasing triggers emerging, a shift in media use and marketing budget cuts, marketers should now take a hard look at what they should be doing differently.
"Any marketer who is not staying close to his changing target audience risks going out of business," he added.
Hong Kong - 31 July - 2009