Insular or introspective: How attitudes will change consumer retail buying habits

This is the era of the introspective consumer, a consumer who is far more pensive, looking at the world differently and reassessing what matters most. 

Over the past four months, there has been a fundamental shift unfolding in how people decide to spend their time, and money. To some extent, this shift is driven by financial necessity and the associated angst that comes from the current economic downturn. It is also driven now, more than ever before, by a shift in how people prioritise their values.

EY’s Future Consumer Index tracks changes in attitudes, outlook, values and behaviour across 18 countries each month.

In our most recent research in June, only 11 per cent of respondents said they were feeling worse than last month, with most saying they were about the same. We expect this could change , depending on how New Zealander’s respond to the news that Australia is experiencing a significant second wave in Victoria that has caused border shutdowns. 

The loss of control in their lives has made people more inward focused and self-protective as they worry about what the future holds. We are seeing a pronounced shift in values due to deep reflection about ‘what matters most’ for people.  

While the shift in values is not necessarily surprising when we consider the likely impact of major health and economic crises, it will have a lasting impact on the behaviour of consumers and should change the way retailers and consumer facing organisations think about the way they plan to interact with their target markets. 

“While the economy in Australia wasn’t at full horsepower in 2019 with a number of key metrics below where they needed to be, life was still quite good,” EY Sweeney partner Marc L’Huillier says.

“Most New Zealanders had a comparatively stable foundation and largely felt in control of the direction of life. They had more certainty than not and could look to the future with a degree of confidence. With the pandemic came an immediate loss of control and anxiety about what it all meant. People felt disorientated. Large numbers lost their job or had their hours reduced, with many reliant on the different forms of government support. Of those remaining in employment, over one-third are worried about the security of their job. It has been an incredibly confronting and unsettling period.

“The coming period of a sustained economic downturn also holds profound implications at a social and political level. The acute pressure it puts on people and the associated feeling of vulnerability has an impact. We will see much harder-line social perspectives and uncomfortable prejudices emerge.” he says. 

The relevance for organisations of this pressure on consumers and how it will play out in the future lies in the way their values are being re-defined. This latest data shows consumers pulling in quite different directions as they prioritise different things. We saw five value-based segments emerge in our study. For some it’s about the base level of affordability and financial survival; while for others its about prioritising areas like health and safety, the planet and environment, societal good, and putting personal experiences first. Any organisation looking to connect with consumers needs to understand this evolution and fragmentation.

As part of the shift and in accordance with the data showing a move to more self-protectionist and insular values, the Index shows nearly two-thirds of consumers now want to buy domestic brands produced in their own country. More specifically, 60 per cent of those surveyed said they would prefer to buy local and independent brands produced by businesses within their local community, compared to only 14 per cent for either local or domestic brands produced outside their home country. 

“The shift to a highly contemplative and pensive mindset was accentuated by the monotony, deprivation and social isolation of lockdown. The forced reclusion created time to think, to reflect and to worry. It’s seen the emergence of what can be called the introspective consumer,” L’Huillier says.

He suggests how well retailers and consumer facing brands weather this next period will be predicated on their commitment to being human centric by putting consumers values and behaviour at the heart of decision-making, the confidence to evolve business models to meet the expectations of customers with different outlooks, and the ability to deploy technology solutions at speed. A transformative mindset needs to prevail.