It is now a full 10 years since the financial crash of 2008 but the post-recession psyche not only persists, but has become ingrained for large swathes of the population. Our most recent research into consumer behaviour and attitudes revealed that 61% of UK consumers feel compelled to seek value. The “tightening the belt mindset” has become entrenched. For the majority, the search for value is not a choice but a necessity. At the same time, largely thanks to technology and changes in the retail environment, notably the entry onto the market and rapid growth of discounter supermarket chains, we have seen the emergence of what we term the “savvy consumer”.
It is also clear to me that these learned behaviours are making themselves felt in many other aspects of life and that not only retail brand and product managers need to take note, but also guardians of employee brands. I will demonstrate precisely why this is the case, but first let’s take a step back and explain the background to the research.
Over the past three years, BJL has been involved in a research project to better understand the changing nature of people’s post-recession consumption and shopping patterns. What we have uncovered is that the quest for value – something that has been forced on many UK households – is about much more than low prices. The value people seek has many dimensions, some of which influence a lot more than shopping patterns.
BJL’s Marginalised Masses project began in 2014 when we observed that despite top-line economic indicators pointing to recovery, there seemed to be as much evidence to suggest that consumers weren’t feeling the benefit.
The research we conducted revealed that indeed the so-called green shoots of recovery weren’t reaching very far. 61% of the UK population fell into a group we labelled Marginalised Masses, a group who were taking extraordinary measures to pay for essentials – measures ranging from using a credit card, to taking out payday loans to make ends meet.
In 2016 we repeated the exercise to discover that, once again, 61% of the UK fell into this group. Even if we leave aside the economic and political uncertainty following the Brexit vote, it seems that nearly two-thirds of the UK population are adopting a range of strategies from using their credit cards to pay for groceries to downsizing their homes in order to pay their way.
However, one of the messages that came across loud and clear is that people across all market segments have developed a very sophisticated understanding of the difference between price and value. They understand that value is also about quality and durability. They are willing to consider and work out the benefits spending more on premium products – ultimately to avoid the risk of wasting money. Here is a typical response from our qualitative research:
“…our car needs tyres and we’ll get Michelin ones because we know they’ll last longer. It’s about getting those individual things that you’re willing to spend more on…”
But perhaps the most interesting finding from our research is how this value equation extends beyond the price-quality relationship. People’s limited means force them to work out what’s really important to them: what are they willing to make sacrifices for? What will they do without in order to be able to appreciate something that holds real value to them?
This outlook extends beyond people in the lower income brackets: 61% of the population includes a large number of middle-income earners. Thus we all know anecdotally about middle-class consumers who now buy their basics at Aldi or Lidl so that they can spend more on the finer things of life. The pursuit of value is at the heart of many of life’s most significant decisions too. The creation of great experiences through meaningful experiences and opportunities are all-important, and never more so than when children are involved. As one of our respondents said (whose household income had recently taken a hit):
“I’d live in a cardboard box to keep my son at that school [fee-paying Manchester Grammar]… that’s why I now get my food from Aldi and get my hair done at a college, so he can go on being happy and having the best possible schooling.”
The point here is that the quest for value is permeating not just the way we shop but bigger and broader life choices. And that includes career choices. HR professionals who are responsible for employee branding need to take note. It’s important that brands have a clear sense of how they are going to deliver value, and ensure that this is enshrined in the way they operate to create a clear and transparent contract with their customers, users, employees and candidates.
Attracting the “savvy candidate”
Can recognition of the many dimensions of value inform the way companies attract and retain their employees to good effect? Yes, very much so. Much has been written about the changing relationships and expectations different generations have with employment. Millennials in particular have high expectations and are often looking for more rounded experiences at work.
Even before the onset of the economic crisis of 2008, sociologists were noting a shift in attitude among Millennials. Larry Nelson noted that “In prior generations, you get married and you start a career and you do that immediately. What young people today are seeing is that approach has led to divorces, to people unhappy with their careers … The majority want to get married […] they just want to do it right the first time, the same thing with their careers.” People spend more time figuring out what they want from their life and careers. Now, given that fewer people can expect continuously rising incomes and an ever-broadening spectrum of opportunities, this mode of thinking has become more firmly entrenched.
As an example, it has become increasingly common for millennials to put off serious long-term employment, sacrificing income potential to travel the world or gain some life-enriching experience on a volunteer project.
So if money is no longer the be all and end all, what do employers need to offer? Morgan McKinley has already addressed this issue in some depth, but I would like to add some further thoughts, drawing on our research.
Putting value on memories
One of the most fascinating findings was that increasingly, people also put value on memories and the experiences that create them. Many respondents revealed that they’d sacrifice everyday events in exchange for an occasion that they’d remember. So, popping out for a drink several times a week is sacrificed for more meaningful outings that’ll be recalled in the future. Memories are part of the value equation.
In the context of employment, this could mean:
- Participation on a highly visible project
- An overseas assignment
- Participation on cross-functional projects
- Opportunities to work in the community
- Learning & development beyond core skills and qualifications
- More time with the family
In general, employers will find it increasingly difficult to attract people into jobs that are, or are perceived as being, routine – even if they are well rewarded. Routine does not create great memories, whereas rich experiences and momentous achievements do.
Employers who are interested in creating a really powerful employee brand need to give serious thought to how work can enhance life in its entirety, especially bearing in mind today’s increasingly always-on economy, in which work-leisure boundaries sometimes appear blurred.
Moreover, just as consumer brands from tyres to supermarkets are striving to build customer loyalty by alleviating the burden of life’s larger expenses, employers can do likewise. For instance, private companies and public sector organisations can leverage their superior buying power to add to their employees’ quality of life in innumerable ways, such as membership of gyms and sports associations through to support for mortgage and accommodation expenses and school fees.
The bottom line is that an offer of employment, a job, a career is also a value proposition and today’s “savvy candidate” is going to consider the many dimensions of value before choosing an employer.
MORE ON MILLENNIALS:
- The workplace in 2025: the generation of millennial explorers
- Millennials: true to the stereotype or true future leaders?
- Do you really recognise the needs of the millennial workforce?
- Why you should stop calling me a millennial/06
About the author
Tony Evans has been Planning Director with London and Manchester-based Marketing Agency BJL since November 2014. A Planning Director with over 20 years’ experience in market research, marketing and advertising agency roles, Tony seeks to simplify wherever appropriate in an increasingly complex communications landscape.
To find out more about BJL’s research on the Marginalised Masses please get in touch via www.bjl.co.uk.