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Analyzing the Main Changes in New Consumer Buying Behavior during Economic Crisis

Authors:
  • Bucharest University of Economic Studies, Bucharest, Romania

Abstract

The negative social effects caused by consumerism and especially hiperconsumerism leaded, in the recent years, to the emergence and rapid growth of economic importance of new types of consumer - the new consumer - whose attitudes, aspirations and purchasing patterns are different from those existing in the past. The paper outlines at first, a portrait of the new consumer, highlighting its main features, derived primarily from the need for authenticity, which distinguishes it from the so-called traditional consumer. Amid global economic crisis, which turned out to be not only a financial crisis, but also one of capitalism, the new consumer behavior has encountered a series of changes. The recession has led the consumers to look for new landmarks: they became more economical, more responsible and more demanding. Research conducted in different countries showed that the recession had a strong economic and social impact on consumers. The paper analyze the results of some research realized in different countries in the recession period in order to highlight the main changes occurred in the new consumer buying behavior and to draw a portrait of him after the economic crisis.
International Journal of Economic Practices and Theories, Vol. 1, No. 1, 2011 (July)
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Analyzing the Main Changes in New Consumer Buying Behavior
during Economic Crisis
by
Lelia Voinea, Alina Filip
Bucharest Academy of Economic Studies
E-mail: lelia.voinea@gmail.com, filip.alina@gmail.com
Abstract. The negative social effects caused by consumerism and especially hiperconsumerism leaded, in the recent years, to the
emergence and rapid growth of economic importance of new types of consumer - the new consumer - whose attitudes,
aspirations and purchasing patterns are different from those existing in the past. The paper outlines at first, a portrait of the new
consumer, highlighting its main features, derived primarily from the need for authenticity, which distinguishes it from the so-
called traditional consumer. Amid global economic crisis, which turned out to be not only a financial crisis, but also one of
capitalism, the new consumer behavior has encountered a series of changes. The recession has led the consumers to look for new
landmarks: they became more economical, more responsible and more demanding. Research conducted in different countries
showed that the recession had a strong economic and social impact on consumers. The paper analyze the results of some research
realized in different countries in the recession period in order to highlight the main changes occurred in the new consumer
buying behavior and to draw a portrait of him after the economic crisis.
Key words: changes, consumerism, consumer behavior, economic crisis, new consumer.
JEL classification: P 46, M 31
1 Introduction
Consumer behaviour has changed greatly over the
last 25 years, but it has been evolutionary and the
seeds of change have been apparent for
generations (Kar, 2010).
Mutations occurring in the new consumer’s
perception of goods quality should not be
understood as a quickly process or easy to locate
in time.
In any case, we believe that the origin of these
changes in consumer behavior is found through
the introduction of the US Consumer Bill of
Rights in 1963, which gave the consumer a higher
status, because the Government took on the
responsibility of protecting his rights: the right to
safety, the right to be informed, the right to
choose and the right to be heard.
From that moment, manufacturers could no
longer simply produce, because the consumer
needs and wants needed to be taken into account.
Consumers had choice for the first time and were
aware of it (Kar, 2010).
Underlying the consumption choices is a desire to
feel good, not only physical, but also emotionally.
But, in the last decades, consumers have faced an
explosion of product choices and it is causing so
called “consumer vertigo.” The consumer became
increasingly anxious about choices and
sometimes he chooses not to buy something for
fear he will make the wrong selection.
What makes people feel good emotionally is
changing now. Thus, the consumers are seeking
more purposeful pleasures that last longer and
offer deeper satisfactions. Impulse shopping gives
way to a more considered and conscientious form
of consumption. All these announce a new era:
the era of mindful consumption and of new
consumer.
In this paper is realized first a literature review in
order to identify the determining factors of the
emergence of new consumer and to highlight the
main features of this one. Further, through a
International Journal of Economic Practices and Theories, Vol. 1, No. 1, 2011 (July)
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15
research from secondary sources, it was analyzed
the main changes occurred in the new consumer
buying behavior during economic crisis.
2 The failure of consumerism and the
emergence of the new consumer
Few decades ago, the driving force behind
consumption was the desire of individuals to
improve their social condition through possession
of material goods, which ensured middle-class
membership.
But consumerism proved unable to make people
happier, especially by the fact that it did not cause
an increase in welfare in other ways than the
psychological ones. Excessive consumption that
has created so-called "paradox of happiness",
which is that once a basic level is provided,
happiness does not increase with income above
this limit (Drakopoulos, 2008: pp.303-315).
Hyperconsumerism has failed to satisfy the
consumer, leaving him unhappy and alienated
from others and from the natural world. A
paradox of modern consumerism is that even as
those who have come to own more, had less.
Consumers are experiencing feelings of
emptiness and disconnectedness. In response,
they began to want real and authentic
experiences. They are seeking more: more
meaning, more connections, more substance,
more satisfaction, more purpose (Euro RSCG
Worldwide, 2010b).
That’s why in recent years we have witnessed the
emergence and rapid growth of the economic
importance of new typologies of consumer - the
new consumer - whose attitudes, aspirations and
purchasing patterns are different from those
existing in the past.
Because the new consumer largely exhausted the
things he must bought, he is focusing instead on
what he wants to buy and is therefore looking for
opportunities and experiences that could make
life happier and more satisfying.
New consumer focuses even more on the original
products, innovative and distinctive and on the
services. As a result, it tends to reject goods
produced and sold in mass for products and
services that can claim to be authentic in some
way.
If in the past every major aspect of a transaction,
from the price paid to distribution channels
available, was dictated by the manufacturers and
suppliers in the new context of market, power is
transferred more and more to consumers who are
increasingly able to dictate not only what they’ll
buy, but how and where the goods they purchase
are made and even for some products, what they
are willing to pay for it. The new consumer has
become a major player in an increasingly
fragmented market, contributing also to the
increasing in its fragmentation.
While traditional consumer was usually not
involved in production, conformist, and most
often uninformed, the new consumer is
individualistic, involved, independent and
generally well informed.
Lewis and Bridger (2000) show that mutations in
the new consumer behavior derives mainly from
its desire to purchase authentic, stressing that the
main difference between these two types of
consumers is that, while the consumption
behavior of traditional consumer was largely
motivated by a need for comfort, the new
consumer behavior is determined by looking for
authenticity.
Authenticity is the new consumer mind
equivalent to that level of quality able to produce
him fascination. It has become a new quality
standard, and manufacturers must strive ever
more to achieve it, in order to ensure the
authenticity of their products that the new
consumer seeks.
The search for authenticity determined the new
consumer to become individualistic. New
customer assumes the freedom to seek those
subtle differences that distinguish an authentic
product from one produced in series. For the
International Journal of Economic Practices and Theories, Vol. 1, No. 1, 2011 (July)
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16
uninitiated, subtle differences might go
unnoticed. For new customer, however,
differences are a source of pride and self-
assertion, because in his view, it symbolizes not
only belonging to an exclusive group, but is also
a stamp of authenticity.
To ensure authenticity of products and that what
he are buying exactly matches its needs, the new
consumer is often more closely involved in the
production and/or consumption process, this
approach aimed at health protection of his family
and respect of certain ethical principles.
Traditional customers, although sometimes
engages in production or consumption, are
generally detached and more likely to accept what
they offer. They addressing quality as according
to a referential (standard, technical regulation),
trust that producers provides them goods that will
meet their expectations, without having to enter
the depth of things.
Information is the fuel that operates the new
consumer. Due to expansion of information
technology and the Internet, information is now
cheaper and more accessible than ever to
consumers. The permanent need of the new
consumer to be informed is justified by the fact
that information, opening many ways to choose,
permits him to make more careful judgments
about future purchases, and thus providing greater
control over expenditure. New customer check
labels and study the content of products, compare
prices, review brands promises, weighing options,
puts pertinent questions and knows his legal
rights.
All these pave the way for a consumer to become
better, more active and more responsible.
In recent decades, new information and
communication technologies in the world have
been suffered dramatic changes, more
pronounced in recent years with developments in
information technology which increasingly
transformed reality into a virtual world.
Currently, the new consumer is characterized
primarily by cynical attitude manifested for
classical advertising (which tell him to buy
something, but not to explain why) and Internet
addiction, the media that enjoyed a growing
confidence on the part of consumers and from
which it gets information that it directs the buying
decision (Onete et al., 2010).
We note therefore the obvious tendency of
decreased consumer’s confidence in brands,
displayed simultaneously with that of increasing
their confidence in the opinions of others.
Consumers credit less and less the brand message
transmitted through TV commercials, they are
more inclined to take into account what others tell
them, with which interact in different
environments, especially online. These are the
conclusions drawn from the study "The New
Consumer Study", conducted in 2009 by the Euro
RSCG Worldwide, showing that the new
consumer clearly have increasingly higher
confidence in online content generated by their
peers and therefore uses the most of online tools
to connect with others and to document in order
to make the best purchase.
Consumer choices are made increasingly more
and more on the basis of social media
information. In addition to deciphering the
advertising message and reading the websites of
companies, consumers use different online
formats (forums, chats, blogs, etc.) to share ideas,
to form communities and to contact their peers.
As pointed by Kozinets (2010) social media is
increasingly seen as a more objective source of
information and all these communities have a real
existence to their members and therefore have
effect on many aspects of behavior, including
buying behavior.
3 Mutations in new consumer buying behavior
during the economic crisis
The global economic crisis has determined many
changes in the new consumer behavior and has
led the vast majority of consumers to look for
new landmarks: they became more economical,
International Journal of Economic Practices and Theories, Vol. 1, No. 1, 2011 (July)
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17
more responsible and more demanding. Many
market researches realized in the last three years
showed that.
An U.S. study realized in 2009 by Booz &
Company, which involved a total of 2000
consumers, confirmed that a “new frugality”
appear at the beginning of the recession and
highlighted the first two years of declining
consumption per capita, was so strongly rooted
among American consumers and it changed their
consumption patterns in such a manner that is
expected to persist even if the economy recovers.
This new frugality, characterized by a strong
awareness of the value that dictates compromises
in terms of price, brand and comfort, became the
dominant mentality among U.S. consumers, as
shown by M. Egol, A. Andrew Clyde and K .
Rangan (2010).
The study mentioned above revealed that 65% of
American consumers increasingly using coupons
more often, preferring to buy at low prices at the
expense of comfort shopping, focusing on saving.
The new frugality and value consciousness,
which now directs consumer behavior, does not
apply to products such as “opening price point”
(OPP) (produced with the lowest prices at
branded retailers).
Consumers continue to buy the products at
different prices, in turn they need more reasons to
justify the purchase, regardless of price segment
of which the product belong. They refuse to buy
at higher price unless they clearly perceive
quality advantage. If they are loyal to some
brands, they prefer to wait for a price drop, by
promotions or discount coupons. Inherent
behavioral differences in this new frugality are
reinforced by demographics, including income,
gender, ethnicity and age. For example, although
in general, consumers buy products in different
price categories, there are certain segments of the
population (such as women, people with low
income, middle-aged people) seeking to make
savings, buying products at reduced prices (Egol
et al., 2010).
A study made in 2009 on a sample of 2400
people in France, U.S. and UK, by Euro RSCG
C&O, in partnership with Harris Interactive, was
aimed at understanding the factors that influence
preferences and consumer choices and sketching
a portrait of him after the crisis. The study
showed that most consumers surveyed changed
their consumption behavior by adopting a logical
standby or a replacement, distinguishing their
purchases or dropping different brands.
Thus, before being interested in the price of
products, consumers are asking questions about
their usefulness (64% of respondents wonder
whether they really needed, 60% if the product
could not find a lower price elsewhere and 59% if
they can afford to acquire). In the context of
crisis, perhaps contrary to many expectations,
quality is what comes first for the new consumer
before the lower price. Consumers surveyed
defined quality by: looking for healthy products
(42%), looking for strong and sustainable
products (47%) and for responsible products
(http://www.eurorscgco.com).
So, we notice that the place of the reckless
consumer was taken by the temperate consumer,
doing permanent arbitration. New consumer
seems to have understood that true progress is to
consume better, not more.
Research conducted by Euro RSCG has found
that in the countries surveyed, the crisis has
caused a net slowdown in consumption. Apart
from modifications in the priorities of consumers,
the crisis has substantially changed the perception
and representation they have on brands and their
benefits.
The results of an online survey, realized by
Market Probe International (in 2009 and 2010),
on 5700 adults in 7 markets (SUA, Brazil, UK,
France, Netherlands, Japan, China) show three
keys to understanding the relationship between
consumers and society in the post-crisis period :
A high sensitivity to risk. Although economies
of the developed countries are on the rebound,
the consumer anxiety remains high and it has
International Journal of Economic Practices and Theories, Vol. 1, No. 1, 2011 (July)
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18
its roots not so much in today’s reality as in
imagining what tomorrow might bring. The
consequences of this sensitivity are: reticence
to make long-term decisions, avoiding risk
will be the main reason in taking decisions,
consumer orientation towards the brands that
manage this risk.
Consumer depression echoes societal
problems. According to David G. Myers
(Hope College psychologist) young adults
nowadays grown up with more plenty, less
happiness and a greater risk of depression and
assorted social pathology. The widespread
discontent of modern life on both a personal
and societal level affects the mental health.
Consumers have forgotten the essential in
their endless search to consume more with
less effort.
Consumers seek for change and know they
can rely only on themselves. Recession is an
opportunity to step back and think deeply.
They will look for something “bigger than
self”, from “active pessimism to “proactive
mindfulness”. Despite their anxiety, people
are changing the status quo and take greater
control of their present lives and futures. A
primary way in which they will do this is
through their consumption choices. Their
strongest means of power and influence it is
the advent of “proactive mindfulness”.
4 Conclusions
Each feature of the socio-economic situation has
substantially changed not only the way the new
consumer purchases, but especially what they are
buying and why they are buying. In developed
countries, new consumers are more economical,
more responsible and more demanding than
traditional consumers. Currently, new consumers
are increasingly aware of all aspects involved in
purchase of products, from design, safety, origin,
to their social and economic impact.
Thus, consumers have become more vigilant new
and more aware of their ability to influence the
world with their consumer choices (Salzman and
O'Reilly, 2010).
During the economic crisis a series of parallel
steps have made their presence, resulted in the
new consumer orientation on organic products or
on fair trade products. Thus, a particular point of
view, the crisis served as a mini - electric shock,
announcing a new era, maybe the era of
responsible consumption.
In Mansoor (2011) opinion, the main changes in
the new consumer behavior, which are the result
of economic recession could be summarized as
follows:
The need for simplicity: during recession
consumers are accustomed to limited offers
and tend to simplify their demands, so that
after the crisis is expected that they will
continue to accept simple offers, but with
greater utility.
Temperance: even rich people save, although
they are not required to do so. This is one way
they show their dissatisfaction on excessive
consumption. They began to recycle and to
teach children traditional values.
Smart consumption: consumers today are
"agile" and act quickly to price changes, with
the ability to change brands looking for the
lowest price, sacrificing the quality and
loyalty.
Green consumerism: this trend slowed during
the recession because people are not willing
to pay more for certain products that can be
substituted with others with cheaper price.
The demand for environmentally friendly
products has declined during the economic
crisis, but anticipated a recovery after the
recession.
Ethical consumerism: people are less willing
to charity actions, because they are more
concerned about the welfare of their families.
In this case, is expected to rebound slowly.
International Journal of Economic Practices and Theories, Vol. 1, No. 1, 2011 (July)
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19
Acknowledgment
This work was cofinanced from the European
Social Fund through Sectorial Operational
Programme Human Resources Development
2007-2013 project number POSDRU
89/1.5/S/59184 „Performance and excellence in
postdoctoral research in Romanian economics
science domain”.
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Authors description
Lelia Voinea, Ph.D. is a Lecturer in Business, Consumer Sciences and Quality Management Department,
Academy of Economic Studies from Bucharest, Faculty of Commerce. Her research and teaching covers
Food Science, Fundamentals of Commodity Science, Design and aesthetics of merchandise.
Alina Filip, Ph.D. is a Lecturer in Marketing at the Marketing Department, Faculty of Marketing, The
Bucharest Academy of Economic Studies, Romania. Her research and teaching interests encompass
relationship marketing, customer relationship management, business to business marketing and
international marketing. She has participated in research projects and various publications in the field of
marketing.
... As a result of the 2008 economic crisis new trends in consumer behaviour have been identified (Flatters and Willmott, 2009;Voinea and Filip, 2011;Mansoor, 2011): a) consumers tend to simplify demand and become discretionarily thrifty and frugal; b) even many affluent people economise, recycle and avoid excess consumption and waste; c) consumers switch brands looking for the lowest price, sacrificing quality and loyalty; d) green consumerism slows and demand for green products declines because people are not willing to pay more for products that have cheaper close substitutes; e) ethical consumerism declines as consumers focus on their families' welfare and reduce their support for social causes. ...
... Frugality becomes a common predecessor of purchasing in situations of economic constraint (Lastovicka et al., 1999). Consumers are more aware of the environmental impact of their actions, but at the same time they are more restrained and buy products at lower prices as they are unwilling to pay more for a product if they do not see a clear advantage or utility in it (Voinea and Filip, 2011). ...
... The greater tendency towards materialistic values in times of crisis (Abou-Chadi and Kayser, 2017) may explain the greater importance of EI found in this study for such times, as lost post-materialistic values must be remembered (Cotta and Memoli, 2020). This, added to the facts that consumers tend to minimise the advantages of green products in times of crisis (Voinea and Filip, 2011), that economic motivations do not override environmental motivations (Zavali and Theodoropoulou, 2018) and that attitudes are highly influential on ecological behaviour, as determined by the present study, suggest that environmental information policies may be more influential as an activating element for pro-environmental attitudes, i.e. EI could help to keep pro-environmental attitudes at the same level both during a crisis and afterwards. ...
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Abstract The educator in modern society interacts with a diverse group of children/students when she/he works with or teaches extremely heterogenous groups of individuals who may be characterised by diversity that is not only cultural and linguistic in nature, but also moral. A similar situation arises in terms of moral customs, modes of behaviour and habits. A whole range of lifestyles and normative opinions converge at school and in the classroom. Consequently, educators need methods and sound knowledge in order to be able to address moral and ethical problems. According to Banks, Stárek, the most controversial area of ethics in helping professions is the conflict between ethical values and principles. The job of educators is becoming more and more complicated and demanding. Educators have to increasingly take into account the voice and reaction of parents. Students are more diverse. School management is becoming more professional and more administratively complex. Schools and other institutions are newly defined and there are changes in legislation and key documents. Consequently, educators have to work strategically in a field that is increasingly more determined by the social and personal interests of higher positions along with cashflow/economy, legal frameworks and political power. On the other hand, it is becoming increa+63singly clear that the core of the teaching profession includes not only teaching but also the relationship with students and parents. Educators can barely cope with the speed of changes in the teaching profession when they have to protect its core and sometimes even fight for it, not only in schools but even in society, where the issue of teacher status is often addressed. Educators can better protect themselves and have a professional space to defend the quality of their profession. Professional ethics can play an important role in this task. For the teacher, it is not a top-down ethics but the ethics of educators that frames what governs and interconnects teaching professionals. The research sample consisted of teaching staff working at a primary school in Prague. The teachers work in the first stage of primary school. The selected primary school has a code of ethics as an internal regulation. In total, five interviews with teachers were conducted. Respondents agreed that the Code of Ethics and Ethical Decision-making Model are good support for their professional practice. They are primarily useful in the communication process, especially when talking to children, colleagues and parents.
Online food delivery services (OFDs) have gained the attention of researchers due to the rapid growth of society. With COVID-19 wreaking havoc on markets worldwide, it compelled retailers and service providers to adjust their way of doing business drastically. OFD's emerged as an option either due to consumers' inability to cook, fear of exposure to Covid if they leave the house, monotony of eating home-cooked meals, and safety measures practiced by them. Hence, during this pandemic, the OFDs created a win-win situation for restaurant owners and consumers. However, the current literature does not clearly picture the factors influencing customers' behavioural intentions while using hospitality services in the wake of the COVID-19 pandemic. The primary objective of our study is to understand the factors influencing customer satisfaction during the pandemic. In addition, explore the mediating role of consumer resilience and consumer attitude to strengthen the relationship between product involvement and customer satisfaction in the OFDs context. We have used the social cognitive theory as the theoretical framework for framing our hypotheses. The present study focuses on Indian consumers who have used OFDs during the pandemic. We employed a cross-sectional survey method to test the proposed research model. Two hundred forty valid questionnaires were collected to empirically test the research model using tools like confirmatory factor analysis (CFA) using AMOS-28, direct and indirect relationships were tested using SPSS PROCESS macro. The results indicate that all the proposed hypotheses were supported. Theoretical and Practical implications of the study along with limitations are discussed.
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In response to grocery shortages during COVID-19, UK supermarkets limited the number of products consumers could buy, to keep products on the shelves for longer, discourage stockpiling, and help fairer distribution. The effectiveness of this strategy has been questioned, as shortages continued for months and reappeared during further waves of the virus. To better understand the consumer perspective, primary data collected online from over 400 respondents during the UK’s initial lockdown period has been analyzed. By drawing on key concepts from hoarding and scarcity literature, such as commodity theory, the bandwagon effect, and regret theory, we identify factors that influence the effectiveness of the pandemic rationing policies. The broader themes of consumer (dis)empowerment, routine disruption, and emotional fallout are considered, with recommendations for future strategies provided. The findings highlight the importance of timing, consistency, and communication for implemented strategies, and the need to consider the difference between ‘equal’ and ‘fair’ product distribution.
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research technique for providing consumer insight. “Netnography ” is ethnography adapted to the study of online communities. As a method, “netnography ” is faster, simpler, and less expensive than traditional ethnography, and more naturalistic and unobtrusive than focus groups or interviews. It provides information on the symbolism, meanings, and consumption patterns of online consumer groups. The author provides guidelines that acknowledge the online environment, respect the inherent flexibility and openness of ethnography, and provide rigor and ethics in the conduct of marketing research. As an illustrative example, the author provides a netnography of an online coffee newsgroup and discusses its marketing implications.
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The consumer is the most elemental basis for any business organization; hence, their core behaviour is also ofgreat importance and significance for a successful marketing experience and financial affluence. However,consumer purchasing behaviour can vary severely and has a very intricate trend. Consumer buying behaviour hasbeen attracting the studies and interest of a large amount of commercial and academic faction for a long time.The level of intricacy of the process where the consumer buying can relate to has made the trend greatly difficultto be predicted and managed. This research aims to study the impact of the Global Business Crisis on Bahrainiconsumers, investigate their perception of this problem and whether their consumption behaviour has changed asa result.As known, the current financial downturn had a huge influence on the economic and social aspects of consumersaround the globe. Different behaviour has been shifted through different level of economies, one of which, theBahraini culture purchasing pattern. For this reason, this research is aimed to focus on the changing trends inconsumer buying behaviour in the present global business crisis.
The New Consumer Frugality, www.strategybusiness.com/article/00023?pg=all
  • M Egol
  • A Andrew Clyde
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Egol, M., Andrew Clyde, A., Rangan, K. (2010), The New Consumer Frugality, www.strategybusiness.com/article/00023?pg=all, Accessed 2/06/2011
Consumer behaviour over the last 25 years, Oxirm Research Themes, Oxford Institute of Retail Management, The Retail Digest
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Kar, M. (2010), Consumer behaviour over the last 25 years, Oxirm Research Themes, Oxford Institute of Retail Management, The Retail Digest, pp 46-53;
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