Consumer thriftiness likely to outlive the recession

Changing consumer attitudes in Ireland have been revealed today (7 September) as consumer research specialists Mintel Ireland launch ‘Irish Lifestyles 2009’, their flagship research study.  The exclusive new research finds that after a prolonged period of wealth and opportunity, Irish consumers are still coming to terms with the new economic and social reality of recession.
The report provides a snapshot of Irish consumers’ attitudes and behaviour and shows that those of all ages and socio-economic backgrounds are feeling the effects of recession, albeit to varying extents – personally, professionally and financially.
One in four Irish consumers believe that their lifestyle or standard of living will change significantly as a result of the recession and many consumers are changing behaviours in a range of areas from personal finance to grocery shopping, through to amount spent on luxury goods and personal care.Media coverage of the role of banks and financial institutions in bringing about the current crisis has dramatically increased consumer cynicism. The report findings suggest this may bring an end to apathy among certain consumers; a third think it has been a wake-up call to get more involved with their finances. Julie Sloan, Director, Mintel Ireland commented  “Unemployment figures have shot through the roof as a result of businesses struggling in the recession and consumers – even those not directly affected – are wary of what the future will bring. Consumers are concerned about their children’s future as well as the immediate impact on their standard of living, and  almost one in four of us have postponed major purchases such as a new car.”
The report also outlines how consumers are regaining control in different aspects of their daily life, with a view to sustaining their current standard of living.
“Relatively low-key behavioural differences like shopping occasionally at discounters, or buying own-label instead of premium brands is helping consumers to assert control themselves. The risk for retailers and branded manufacturers is that these habits will persevere beyond the recovery from recession.”
According to the report, over a third (38%) of Irish consumers will think twice about spending more on premium brands in the future. One in five (20%) said they will buy more local produce to protect local jobs.
Whilst there are clear indications in the report that consumers do recognise the need to curb spending, few (14%) are prepared to sacrifice their foreign holidays in favour of holidaying at home. A steadfast 30% said they try to ignore media reports of the recession and to carry on life as usual – particularly young men aged 15-24 and both men and women aged over 65. Almost one in four claim that the recession has had little to no impact on their lifestyle.
In addition, the report outlined the perhaps surprising low levels of consumers which have lost trust in property as a means of securing their financial security despite the considerable percentage of consumers now in negative equity. Indeed, 18% of Irish consumers have lost trust in property as a means of securing their financial security. Renting is still a less attractive option compared to owning a home; the majority of Irish consumers retain their love affair with property.
The Mintel Irish Lifestyles report covers the island of Ireland and highlights some interesting differences between North and South – not least that the recession has had a much deeper impact in Ireland than in the North and that behaviours and implications are likely to be more widespread and longer lasting for consumers south of the border.