Archive | March, 2011

The Euro RCSG Report on the New Consumer

Euro RSCG interviewed over 5700 adults in five countries and their results are contained in a report titled The New Consumer in an Age of Mindful Spending. The report describes a shift historic in scope away from mindless hyperconsumerism toward an approach that is at once more conscious and more satisfying, and certainly more sustainable.

Consumers still want MORE, but they are defining that differently. Not more shiny trifles and mountains of consumer goods but, rather, more meaning, more deeply felt connections, more substance and more of a sense of purpose. People are looking to live life in a way that offers longer-lasting satisfactions and pleasures than can be found at the Mall.

 

A few statistics from the Euro RSCG report sketch the outline of an emerging “new consumer”

  • 72% say they are trying to improve the way they live
  • 71%  are trying to improve who they are as individuals
  • 59% worry that society has grown too disconnected form the natural world
  • 51% would like to be part of some important cause
  • 67% believe most people would be better off if they lived more simply
  • 69% claim to be smarter shoppers than they were a few years ago
  • 64% say that making environmentally friendly choices makes them feel good about themselves.

The authors of this report summarize a myriad of statistics into four main paradigm shifts:

  1. Embracing Substance – people perceive a loss of depth and meaning. They want more substance and the fulfillment that comes with it. They want to feel connected to something more real than the artificial world that surrounds them. This means connecting with nature and with other people
  2. Rightsizing – in response to a rising mountain of personal and national debt and dazed by the excess of choice, consumers are feeling more anxious and more and more are opting to hop off the consumption treadmill and enjoy the simpler pleasures of life. They seeking to buy and own neither too much nor too little and the majority (70%) respect and admire people who live simply

  3. Growing Up – New Consumers want to feel more certain of themselves and more in control and are taking steps to make that happen, accepting personal responsibility and seeking to build individual competencies  (DIY, gardening, growing food, making clothes) This self-reliance whether alone or in collaboration with others offers a much needed measure of control in a time of anxiety and uncertainty.
  4. Purposeful Pleasure – Where many of us used to prize instant gratification and adhered to the credo of “More is More” the new Consumers are seeking more purposeful pleasures that are longer lasting. They are more interested in how and where products are made, enjoy buying locally produced goods that enables them to get to know the makers.

Can we Create “Intelligent” Destinations?

The trigger for this post came from another that I came across today by The IdeaHive and a conversation held late last night with a friend who asked:  “Why do we call tourism an industry?  It makes it sound so mechanical and sterile.”

Dark side of tourismI sighed internally at my friend’s question – not because it isn’t a very good question – but simply because I have spent the past 20 years arguing that tourism should not be viewed as an industry. The question rem inded me that I seem to have failed miserably in convincing others of that view. My sadness stems from a belief that until we change the way we “see” tourism, we’ll continue down a destructive path.

In 1991, drawing my inspiration from Shakespeare I argued that tourism was not an industrial machine but a living organism, a body – a “body politic of tourism” with the flesh, bones and organs equivalent to its diverse sectors (lodging, transport, attractions etc); the energy and blood flow being the market; and the arteries and veins being the in and outbound transport sector. I further argued that the tourism body wasn’t a closed, self-contained structure but an open dynamic system involving complex sets of relationships – even thoughTim Berners Lee hadn’t even dreamed up the world wide web at that point. At that time, DMO managers and tourism operators thought I was either irrelevant or simply being academic – and I can’t blame them. What has a worldview got to do with putting “bums in beds tonight”?

So you can imagine my excitement when the Internet did become reality and we started to think about creating a “digital nervous system” for tourism destinations that increased their intelligence. The vision was consolidated back in 1998 when we suggested at ENTER 98 that

The challenge at hand is to use the glue of information combined with the wires of telecommunication to bind the discrete elements of a region’s tourism industry into an intelligent whole; into an intelligent enterprise that is sensitive (can anticipate the demands of a marketplace before they are fully expressed); creative (can develop products and services that add value); and nimble – can generate more value faster than the competition.

We started developing an “Intelligent Destination Management System” and, as there were precious few systems  at the time, I was criticized by several academics at the conference for being pretentious in applying the adjective “intelligent.” But I had my reasons….

In terms of implementation and, with technology that was infinitely more cumbersome and expensive than today, a number of us made rapid progress developing and installing multi-functional information systems that enabled one rich database about products and providers to be distributed electronically across a number of channels (over-the-counter information and booking systems in Tourist Information Centres; kiosks, online information search, retrieval and booking systems via the web) – and all before 2001 when the “dot.com” bubble burst delaying the emergence of web services and proliferation of mobile apps for nearly a decade.

NeuronBut sadly what we didn’t shift was the metaphor for understanding the nature and structure of the industry and that is now what’s holding tourism back from realizing its full potential. Because the primary perceptual filter is that of machine and or assembly plant along which inanimate products are packaged for consumption by consumer markets; we’re not harnessing the creative force underpinning the phenomenon as effectively as we could. Machines don’t evolve or self-organize, people do. Tourism is a living system because it comprises people who live in and are supported by living systems. Ironically, the best innovative thinking within destination tourism is coming from those closest to technology not because of their technical knowledge but because they are applying a more effective mental model (ie a living network). The larger tourism community, on the other hand, is stuck because its leaders haven’t changed their mental models from static machine to living ecosystem.

Other parts of our economy are changing their mental models as the full impact of what it means to be living in a globally connected network sinks in. Which leads me to The Ideahive post The author, likely influenced by such luminaries as Peter Russel (The Awakening Earth, 1976)  and  Howard Bloom (the Global Brain)  suggest that to deal with the global challenges facing our species we need to choose to become part of an emerging global mind.  I’ve quoted The Beehive post extensively below and ask my readers to read it with a tourism destination in mind. Ask yourself what might happen if we applied an understanding of neural networks to the way we do tourism? How could we apply their formula for success – either for competitive advantage or, better still, to create a better world?  How can we help destinations smarten up – because if they don’t, they’ll find their sterile, machine-like products as empty and ghostly as the badly planned,  vacant condos littering some costa somewhere on the Mediterranean.

Here’s the contribution from the The Beehive:

Imagine yourself as a neuron. You are connected to many other neurons. You are continuously receiving information from many different directions, deciding which information to pay attention to, and which not. You are constantly synthesizing this flow of information into some form of meaning — a best understanding of the current situation —  and then you share that best understanding with your friends. If neuron Bob is telling me that he thinks we don’t need to worry about global warming, and yet neuron Sarah is telling me that global warming is causing the flooding in Pakistan, then how do I make sense of that, what is the story I tell to others as a result?

What ends up happening, over time, is that each neuron starts to pay more attention to those connections whose information helps make most sense of the world, and pay less attention to those connections whose information increases confusion.

This creates a network that is an integrated, living mirror of the reality that it is experiencing. It is a system that is in a continual process of refining its model of the world, so that its experience of reality makes more sense. This is because it is only from seeing a world that makes some kind of sense, that you can begin to take more effective action.

The function of your brain it to make sense of your world; the function of your social network is to make sense of your collective world, whose complexity requires far more than a single human brain to understand.

By  learning from the stories of others, we can paint a better shared picture to achieve a clearer understanding of the world.

From this understanding arises an equation that describes the potential for a social network to leave a dent in the universe:

O x C x D x A x P = Better Future

O: the openness with which each node deals with information of all kind: its active willingness to learn — (multiplied by)

C: the amount of creative energy each node puts into the network: its willingness to synthesize & share (multiplied by)

D: the cognitive diversity of the network, so that we can collectively see things from the widest range of deeply informed viewpoints possible (multiplied by)

A: the degree of access to resource networks (multiplied by)

P: its shared focus around a common purpose to create a better future for all

This is the formula for how to be part of global mind.

Choose to act as if you are one of the neurons, to help create a better future

Perhaps so called “destination managers/marketers” might find it useful to take a closer look at the work emerging from neuroscience… more  to follow.

Conscious Consumers at Work in New Zealand

This New Zealand project demonstrates New Consumers at work. A “collective” of conscious consumers have a vision of Wellington as a place where it’s easy for people to live socially and environmentally responsible lifestyles.

Their goal is to: To

  • empower consumers to make more informed purchasing choices; and
  • encourage and support Wellington cafes to adopt more environmentally and socially conscious business practices.

Badges Awarded to Cafes in Wellington

The project promotes nine practices which they believe make good business sense, respect people and the environment and reflect current consumer preferences. Participating cafes get awarded a badge for each of nine actions or practices that result in higher levels of sustainability. The nine badges encompass such topics as Fairtrade, composting, organic, recycling, BYO cups, eco-friendly cleaners. free range, and eco packaging.

Emergence of The New Consumer

Source BBMG Conscious Consumer 2009

Use of the term conscious – as applied to business – only emerged in mainstream thinking shortly before the recession got underway. Business leaders like Anita Roddick (The Body Shop) and writer-thinkers such as Paul Hawken, author of Natural Capitalism paved the way for the the new values-based approach to business. Subsequently, books such as Patricia Aburdene’s  Megatrends 2010: The Rise of Conscious Capitalism and Fred Kofman’s Conscious Business: How to Build Value Through Your Values have been cited as influential in the business community.

During the same period there has been a substantial shift  in the approach to Corporate Social Responsibility. Companies initially applied CSR as an optional extra – adding philanthropic projects to demonstrate a degree of responsibility but not really examining and changing their fundamental approach to the utilisation of resources and people in pursuit of profit. As will be described elsewhere, the term CSR is fast disappearing as the business commnuity grapples with the notion that all commerce is about relationships between people and is inherently social in nature — see FutureLab’s short video here.

If there was a reluctance by mainstream business to embrace concepts associated with responsibility, sustainability, or even “green,” it was because they lacked conviction that the market for products and services created by conscious companies was large enough. This feature applied particularly to tourism where responsible/eco/green/sustainable tourism enthusiasts were perceived as a minority fringe. The primary source of research that did identify a customer segment attracted to green, organic, natural products and lifestyles had an unfortunate acronym LOHAS (Lifestyles of Health & Sustainability) that reinforced the fringe element.

Conscious Consumer Segments (BBMG 2009)

As we slowly climb out of  the deepest recession to hit many economies since the 1930s, it has become apparent that a major shift in consumer attitudes and values has taken place that is changing their behaviour “for good” – literally and metaphorically.Conscious consumers are no longer the minority.

BBMG, whose report on the Conscious Consumer is summarized here, suggest that they comprise 60% of the total population. Even if this percentage may be a little inflated, there is no doubt that thanks to their affluence, education and proclivity for community, what conscious consumers do today will shape what the mainstream does tomorrow.

We’ve looked at five major resource sources, all undertaken independently of one another,  some global, others national, that show a remarkable degree of consistency. While the BBMG study is the only one that specifically applies the adjective “conscious” to the so-called New Consumer (BBMG), all describe how a more considered, mindlful, cautious approach to consumption has evolved during the recession and is unlikely to wane should the economy pick up speed.


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