Jed Simpfendorfer – Director Strategy & Partner T garage.
The cost-of-living crisis is the unwelcome guest at everyone’s dinner table right now. We’ve all felt it—over the last few years, prices have been climbing like they’re in a competition to summit Everest, while our wages are sitting in base camp.
So, how are Australians coping? And how can advertisers and marketers best meet their needs in these tough times?
As cultural trend researchers, at T garage, we are continuously engaging with our community of 25,000 Australians. We ran a couple of interactive dips, coupled with some extensive qualitative research, to find out what’s going on with consumers and, importantly, what they want from us.
How Are People Feeling?
First, the reality check. 58% of Australians tell us they’re either struggling or just getting by financially. Money is tight, and consumers are understandably pulling back on areas of discretionary spending, like eating out, socialising, entertainment, shopping for clothes, and tech.
But there is some light. 61% of us are also hopeful about the future. Yep, amidst all this economic doom and gloom, we still have confidence things will turn around.
What Do Consumers Want From Their Advertising and Communications?
The message is pretty clear: consumers are feeling crap, but whilst they’re cutting back on spending, they’re still looking for products and brands that will make them feel joy, happiness, or even just feel again.
What comms are people loving and being inspired by right now? The regular contenders all crop up, including Mondelez’s Cadbury campaigns, Smith’s crisps, and the Telstra community-focused TVC’s, which all bring us a little moment of joy.
Also interestingly, consumers tend to gravitate towards Nostalgic flavours and brands during times of crises. Again, Mondelez has played this well, with consumers reporting their love for the 200 years heritage Cadbury campaign and Smiths bringing back to Gobbledok along with some nostalgic flavours, like Tomato sauce-flavoured chip rotations. Consumers loved this.
Even older ad campaigns, like AAMI’s Rhonda and Ketut or ANZ’s “Bank of Barbara” commercials from over a decade ago, are still etched in people’s memories. These ads make us smile, laugh, and feel something—an emotional connection that’s particularly important in times like these.
The Shift in Category-Entry-Points
Watching trends shift can be glacial at times. But right now, I’ve never seen things change faster.
Take the shift in spending behaviour, for instance: people may be cutting back on dining out but are opting to entertain friends at home, splurging on a bottle of Grey Goose vodka instead of a night out.
When the Cost-of-Living Crisis first began, you may have given up buying steak. But now that a restaurant steak night has become so expensive, shifting to buy steak to cook at home seems to be the go in recent times.
We can’t afford a nice weekend in Queensland (unless we live in Queensland), but we can afford to get away in our local cities.
And categories like supermarket premium pizzas also seem to be having a moment. Again, it’s too expensive to eat out, but we can treat ourselves at home.
Category-Entry-Points can take time to build and shift, but I’ve never seen them shift so rapidly as right now. Figure out where your brand can play a role in this new climate, and you can set yourself up for some significant growth.
Where Do We Go From Here?
The consumer sentiment right now is best described as "on hold". We’re watching, waiting, and hoping things will get better.
But at the end of the day, whether you’re selling gourmet pizza, chocolate, or weekend away stays, the golden rule remains: make people feel good. Joy may be harder to come by these days, but brands that help us find those moments will come out on top.
If you want to know more, you can deep dive into the report on our T garage. Tune in next month for our next update.