June 30, 2022 / Thought Leadership
Q2 Emerging Trends Report
CP’s team of senior strategists and anthropologists regularly release insights on cultural, economic, and social shifts that can impact our clients. Here are their most recent observations.
1. People still dream, the scale is just getting smaller.
In the U.S., purchase decisions are shifting as people adjust to their shrinking disposable incomes. With inflation at heights unseen in four decades, cost of living has become a major concern. Although costs like driving to work and buying groceries are impacting people most, attitude and behavior changes are the most dramatic when it comes to larger expenditures like home improvement and remodeling. Even with home values soaring today, consumers fear embarking on bigger home projects due to higher cost of materials and a shrinking contractors universe. But we expect homeowners will still aspire to improve their homes, and will reframe those dreams with more scaled-back, practical approaches.
2. A reawakening for ‘accessible luxuries.’
Inflation in Q2 and beyond will affect household finances. People are most concerned about energy and agricultural markets and their associated rising costs. Over the past two decades, luxuries and indulgences have evolved in perception from a human want to a human right, perceived to be reward necessities to counter stress and depression. As such, when it comes to tightening the budget belt, we expect consumers to trim their spending on essentials in order to still afford their ‘new need’ indulgences.
3. She-flation is real and it’s being felt in a big way.
The recent spikes in goods and services is disproportionately affecting women (referred to as “she-flation”). Women tend to do most of the household purchasing of goods and thus are more often reminded of inflation in their everyday lives. People’s individual experiences with inflation depend on their purchasing habits and gender. But brands can identify customer sentiments like optimism or pessimism based on these factors and, in this case, account for the heightened emotional toll of the “pink tax” women feel right now. Brands should assess who’s most affected by inflation and do something about it.
4. Treats and rewards as today’s self help.
People are re-evaluating what is a necessity and what is an indulgence. Many people are turning to treats and indulgences as a form of reward and coping or self-help. COVID and lockdown heightened our consciousness on the importance of mental wellness and self care. A brand who encourages people to put their well-being first and encourages treating one’s self is destined to earn affinity.
5. Standing up for something means defying something else.
Alignment against Russia is one of the most extreme alignments among consumers in recent history. People don’t want companies selling to Russia, buying from Russia or maintaining operations in Russia. Younger generations in particular are contributing to effectively canceling a whole country. People want brands to act on their values in ways that may be risky in the short-term, but represent a commitment to personal and organizational human values and equity. Any imaginative brand can find a way to do something similar to create natural affinity.
6. People don’t save for a rainy day when it’s raining.
Lockdown and the pandemic provided the chance for many people to consider what was a priority in the short and longer term. Inflation has now made a lot of our longer term goals seem derailed or unattainable in the present day. Consumers need to be reassured by credible sources that they shouldn’t let go of longer term goals. The economic ebbs and flows are normal and in every environment, there are opportunities to take, and plans to be made or to stick with. Reassurance from a bank to go forth with goals and plans can be very inspiring and reinforce those discovered priorities established during lockdown.
All good things expire. Look out for more trends coming soon.