The global economy has been going through some level of turmoil for quite a while, no doubt. Businesses and consumers across the globe have had their share of ups and downs to face, especially when it comes to financial instability.

Jim Needell, Chief Client Officer, Local Markets, Ipsos agrees that the financial state of the global economy is one of the key factors driving brands to make decisions that can help them adapt to the changing consumer trends.

“The majority of markets now report that financial instability is the number one problem consumers are facing. So brands have to adapt their behaviours to how consumers are feeling about their financial situation, and that can come from anything, from pack size to formulation. Because the only way a lot of the big global brands are growing at the moment is through price increases in many markets,” Needell told exchange4media in an interview.

Needell, along with Suresh Ramalingam, Chief Client Officer APEC, Ipsos sheds light on the changing trends in purchase behaviours, along with added focus put by brands on sustainability.

Edited excerpts:

What is the one big issue that your clients are coming to you with today? 

Needell: The big question that the brands are asking us is ‘how do we grow volume?’ And the volume question is difficult because now, consumers in general have less disposable income in their pockets to be able to buy.

Ramalingam: In some cases volume growth, in some cases they want to address value growth too. Both are important, but sometimes one works and the other doesn’t. The other question they ask is ‘how do I reach my target efficiently?’

So what needs to be the way forward for them? 

Needell: Brands have to adapt. For them to grow in any normal situation or any abnormal situation they need three key things – they need to understand the context, the consumers operating in and the current global context. India is not that much different either, when it comes to financial difficulties. So they have to adapt the way they're promoting and packaging and selling their brands.

And then finally and probably more important is understanding the empathy you need, to interact with consumers. So we need the brands to understand what we as people find important and that could be environmental issues, it could purely be price, it could be any number of things.

So the real trend and something that we said earlier, globally, over the last 15 years there's been an increase in people talking about brand values. However, what we've seen since COVID is actually brand values being replaced by value brands.

So people who've got less money are having to twist that occasion from ‘even though I share a value with you, I can't, my wallet won't stretch that. Therefore, I'm going to have to move to another brand to match what I can currently afford in this economic situation.

With such economic headwinds, how are the consumer trends changing across APAC? 

Ramalingam: See, post Covid it is all about leveraging technology. What is happening now is that the use of technology for day-to-day work is becoming more and more prevalent across all social classes. This is the one that is set to get even stronger going forward.

E-commerce was also thought of to be huge for a considerable amount of time when everyone thought e-commerce would take over all aspects of shopping. However, what we are noticing is that brick-and-mortar retail is also seeing a transformation as we move along. More specialised stores are coming into play and people want the touch and feel aspect.

There also is increased consumer consciousness about sustainability now, so brands need to be conscious about this. Although there won’t be a direct impact on sales, in the future it will get better.

Coming back to India, several global brands have been making their way into this country. What is it that is making them so bullish about the Indian market? 

Needell: So the Indian market is the most populous market in the world and by 2100, it'll still be the most populous nation in the world, while the top 10 keeps changing dramatically. India also has a very adaptable population.

In fact, I read last night that you dwarfed China in terms of financial commerce, and digital transactions because of the way you've democratised mobile phone usage, and the apps right across all levels of society. So India is hugely attractive for the size of the market, and your ability to adapt and adopt new technologies.

Also, the growth in the middle classes in India over the last 10-15 years, where people are coming out of poverty marks huge opportunities for big global brands.

But in times like now, when the global economy is going through a difficult phase, are these brands readily and willingly investing in advertising for the Indian market? 

Ramalingam: So the shift is basically that some of the clients who probably used to spend 80% of their budgets on traditional media, are now spending 80% of their budgets on digital media. Marketers need to assess what is giving them the most returns. Instead, what they tend to do is follow the leading brand, spend money on the same and then struggle to find ROI.

However, no matter what the channel, the product & the message is the king.