Marketers need to acknowledge the impact of the cost of living crisis and start grouping consumers by housing status, not age, or risk damaging the effectiveness of their campaigns, reveals Kantar.
The revelation follows new research from media research group Kantar Media, which looked at how rising costs are influencing people’s behaviour and attitudes as interest rates hit a 15-year high in August.
It found that demographic models on their own are failing to capture the social and economic pressures of rising costs on consumers and that marketers should now label and identify audiences in far more “sophisticated ways”.
This means living circumstances are sometimes more likely to indicate alignment between consumer groups than age – highlighting the challenges of using demographic shorthand alone.
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For example, 27% of 21 to 26-year-olds living at home with parents say they prefer to buy premium goods and services, the same proportion as over 55 year olds who own their home outright, suggesting that exposure or not to the housing market can be a better indicator of buying preferences.
In addition, Kantar Media focused on consumer’s housing status by studying 1.5 million people planning to renew their mortgages in the next year. Their findings showed that this group is significantly less happy with their living standards compared to homeowners.
Only 47% of this group say that they are ‘perfectly happy’ with their standard of living – a fall of almost 20% in just the last 12 months. In contrast, 64% of people who own their home outright are happy with their living standards.
“The cost of living crisis is hitting people in very different ways. Marketers must understand these trends to make sure their messaging lands in the right way with the right consumers.” said Kantar Media TGI managing director, Sarah Sanderson.
“The trouble is many campaigns are still planned largely using demographics, but this misses the nuance of how people’s lives are being impacted. While campaign planning teams probably know the limitations of demographic models, their apparent simplicity can be seductive.
“Our TGI data shows that even labels like homeowner are too broad brush now given the mix of financial pressures consumers are facing.”
