The Baby Boomers may never quite catch on – but mobile payments have won fans among the young US consumers coveted by so many brands.
The GfK insights help our clients to increase the investor’s return on investment by around one percentage point.
Among Canadians, cash is no longer king. For the second year in a row, Canadian consumers are showing a growing preference for non-cash payment methods.<
GfK’s long-running Consumer Confidence Index has increased two points to +4 in January.
GfK’s long-running Consumer Confidence Index has increased two points to +4 in January.
Consumer mood has changed only slightly in January of this year, while the consumer climate has remained stable. Following a value of 9.4 points in January, the overall indicator is still forecasting 9.4 points for February. While both economic expectations and willingness to buy have risen by a small amount, income expectations have suffered losses.
Consumer mood is improving as the end of the year approaches. After four declines in a row, the consumer climate is rising again slightly. The overall indicator is forecasting 9.4 points for January 2016 compared with 9.3 points in December.
First time the Index has shown positive scores for an entire calendar yearGfK’s long-running Consumer Confidence Index has increased one point to +2 in December.
There is consistent evidence in analyzing consumer trends that Americans today are less focused on amassing possessions in defining what a “good life“ is and are more focused on enjoying life experiences with friends and family. Even home ownership, long the defining pinnacle of the American Dream, has diminished in priority, particularly since the Great Recession. This shift in attitude and values is reflected in the relationship consumers have with financial institutions as well. With a greater desire for stability, security and authenticity in their lives and with lingering distrust in the institutions that failed them in these regards just a few years ago, consumers are resetting their expectations of their financial partners.
Money (perceived lack of it) the biggest cause of stress in the world!
Mark Zuckerberg, the founder of Facebook, has declared that he will give away 99% of his shares in the company, worth $45 billion, for philanthropic purposes. He is in good company, as several other billionaires, including Warren Buffet and Bill gates have pledged their wealth to charity. Perhaps the over-abundance of money brings a feeling of responsibility, or even burden and stress, driving the wealthy to philanthropy. However unlike Zuckerberg, for the general public it is the absence of money rather than its excess that causes stress. In a global GfK investigation into what causes stress, a conversation with over 27,000 consumers indicated that a feeling that they do not enough money, is the biggest culprit.
Chinese blame themselves for their stress
Interestingly, the Chinese differ from the rest of the world, by saying that it is not money that causes them stress, but it is the relentless pressure that they put on themselves that troubles them.
In fact, money is not directly mentioned as the top three causes of stress – the other two irritants being “not getting enough sleep” and “not having time for the things that they want to do”. The “self-caused stress” also seems a strong phenomenon in other developed East Asian countries with Confucian influence, including South Korea and Japan. The relentless strife and pressure to get ahead in life is a reality in several Asian countries, and has several sociological and cultural underpinnings. China and other Asian countries, have undergone transformational economic development in a very short period of time – in fact China is very much still in the midst of it, and is far from a developed nation economically. In this environment of progress and development, no one wants to be left behind, and the pressure to continue to move ahead is high.
Confucian values also play a role. In a ranking of 50 values, in GfK Consumer Life (a syndicated study), the Chinese rank “duty” as the 2nd most important, and “working hard” as the 5th most important.
In the US, the same values are ranked 19th and 44th respectively. On the other hand, the Americans rank “enjoying life” as the 5th most important value, whereas the Chinese rank it only as number 13. Clearly the Chinese values are instrumental in driving and pressurizing them – often stressfully.
Isn’t it all about money in the end?
Of course one can argue that the eventual goal of this self-imposed pressure to succeed is money. While it may be true, interestingly it is not the lack of money which bothers the Chinese (also the South Koreas and the Japanese) but the fact that they must strive hard and exert themselves to the fullest to achieve that final goal. This perhaps indicates a feeling of confidence in their ability to achieve the final goal of making enough money for their needs. Chinese have a self-assurance that they will finally make it, but they realize the journey could be hard and stressful – with stress being a direct result of their ambition and desire to surge ahead. Secondly, it could also indicate a lower obsession with money alone as the indicator of success and a belief in multi-dimensional concept of having made it.
Help me make it through the night
For marketers, this mindset has a clear implications. Products and brands, which can alleviate the stress, without diluting the confidence and the focus on success, would be welcome. Brands need to support the consumers in their journey towards their goal, offering support and comfort, making the path more bearable and less stressful. Communication needs to portray brand use and brand benefits to alleviate the Confucian stress caused by ambition, duty and toil. Successful brand communication will convince the consumer that they will reach their goal, but they can still smile, enjoy the life’s pleasures and relax in the journey.
For more information, please contact Ashok Sethi, Managing Director of GfK Consumer Experiences in China, at email@example.com.
Last month, Apple announced that they planned to launch a P2P payments capability using the ApplePay infrastructure. What was compelling about the story was that the plan might involve bypassing the traditional payment networks (MasterCard and Visa). This has been a common theme over the last few years as technology companies (and other players leveraging technology) methodically move into the consumer financial services space. Whether this involves peer to peer lending, robo-advisors, alternative payments, or virtual banks, the story is the same. By cutting out “the middleman” and/or dramatically improving the user experience, these disruptors aim to take over the market. But does this really mean doom for the industry’s bellweathers?
Yesterday, I stepped out of Union Station in Washington DC and seeing the long line for taxis, I opted for Uber – one of the few poster children for tech disruption. I’ve used Uber many times before and have found it to be a compelling alternative to taxis (for all the reasons that have been rehashed in every story about disruption). This time, my experience was a bit different. The driver couldn’t find me at first. When I got in the car, I learned that I had inadvertently hit the “pool” option – which means that the driver was supposed to pick up another rider. I didn’t want that and neither did the driver, so he kept driving even as his Uber phone kept beeping, telling him to turn around. Like I always do, I ask how the driver started working with Uber, and his story was different than I had heard in the past. Less a hungry entrepreneur, and more a semi-retired guy who got in because “everybody’s doing it. Therefore, he wasn’t quite a professional as others I’ve had – very nice, but it felt like my friend’s dad had picked me up at the airport. Then the fun started. He really didn’t know where he was going. The GPS on his Uber phone was acting up, making him miss critical turns. He got flustered. A 20 minute ride turned into 40. The apologetic driver continued to mention that I would have to grade him and he was hoping I understood it wasn’t his fault. In the end, not a terrible experience, but not the one I expected. I’d still use Uber because most of the time, its not a mission critical transaction.
My money, on the other hand, is a different story. As usage of tech disrupters grows, we will undoubtedly see more and more holes. A late taxi is one thing, but a missed payment, a loss of funds, or a mistaken hit to a credit report is another. The clear advantages that the big players have are the well-tested infrastructure they have in place and the comfort with a vigorous regulatory environment. These are not easily replaced. As industry incumbents continue to make strides in customer and user experience, my thought is we’ll see the balance tip away from the disrupters. That said, infrastructure alone cannot protect them. Tech disruption will be the force that parses winners from losers with the winners embracing a new relationship with customers, empowered by technology. As we continue to move from a “me” perspective to a “we” perspective, the firms which use technology to offer personalized, helpful, and memorable experiences will be tomorrow’s leaders.
For more information, please contact Keith Bossey at firstname.lastname@example.org.
GfK’s long-running UK Consumer Confidence Index has decreased one point to +1 in November.