Tuesday, June 17, 2008

Exploring consumer lifecycle

Brands have to continuously evolve to stay relevant to consumers

Marketers have realised the importance of psychographics in consumer behaviour which is useful to analyse the mindset and lifestyles of consumers. Age as a segmentation criteria is nothing new to marketers but its implications to the current-day con text needs to be revisited.

India may have a low per capita income and low penetration levels with regard to several categories of products and services, but scores over several developed markets in terms of its demographics connected to the youth population, with about 40 per cent below 21 years. Longevity too has improved with the 65-plus population on the increase. There is also the children's segment, especially in the urban markets, for products ranging from apparel to watches.

While the actual percentage of the Indian consumers with discretionary income regarding these segments may be low, they form sizeable numbers in terms of market size. These segments not only require just a different approach towards marketing communications: they also require new product offerings that need to be developed. There is also the challenge of developing a line of products/services that will ensure customer loyalty in this era of customer migration.

Adaptability and brands

There were several brands in the past that were extremely successful before liberalisation but have declined after lifestyle changes came about. There are a number of reasons for the disappearance and decline of these brands but one of the important lessons that can be learnt for the successful brands of today is the need for 'ongoing' products and services that will adapt itself to the changes in segments and also produce new offerings for the emerging segments.

A marketer of a plain conventional shaving cream during the Seventies should have moved quickly into brushless creams and gels for the emerging segments. Marico is a good example of a brand that is catering to both the emerging lifestyles without losing track of its conventional segments. The brand kick-started the hair cream category (that has been in the Indian mindset for several decades but did not develop systematically) for the urban youth but also caters to the traditional markets that use hair oil. It has several offerings that blend the goodness of coconut oil with changing lifestyle needs. After drawing attention to its hair cream offering 'After Shower', it has introduced herbal variants of the brand, making the sub-category contemporary with offerings that deliver benefits that are anchored in tradition. The brand is able to straddle the youth segment and also the conventional older segment with appropriate offerings.

Raymond – all along a men's brand – has launched kids' apparel.

Several categories such as foods, footwear, furniture, snacks, cosmetics and apparel, to name a few, offer extensive scope for introducing offerings for the elderly.

For example, a consumer would have grown up with Cadbury's through his youth and may long for a chocolate in his present condition of a diabetic aged over 55 years. The option is a foreign offering that may be expensive. A brand that has strong goodwill built among consumers through a period of time should be able to use the goodwill through the age-cycle of its consumer base. Cadbury recently introduced a variant for diabetics.

Product development efforts coupled with appropriate marketing communication that reinforces a brand's values will be a useful strategy for brands that use the concept of the age-cycle. There is also a need to research the trends and the gaps that may emerge as a consumer base ages. For example, the 50-plus woman of today may have used a well-known brand of cosmetic during her youth but may require an affordable offering to take care of her cosmetic needs that are significantly different today. Currently, there are a few brands that address the higher end of the cosmetic market. There is a huge potential at the middle end of the cosmetic market, if tracking studies are done on the usage patterns of cosmetics users about two decades ago.

Seamless transition and brands

The most important implication of the age-cycle concept of segmentation is the possibility of a seamless transfer of a consumer base when they transit from one role to another over a period of time. The 'transition point' captured with specific needs and highlighted with clarity will ensure that consumers will perceive a brand as genuinely caring and have a lasting relationship with it. If the mobile market is considered, a slew of services and offerings is being advertised for several segments and an average consumer fails to understand how certain services are relevant to his/her needs. Besides being drawn by symbolic/emotional appeals, the consumer is likely to develop an inappropriate 'value for money' perception with the feeling that the greater the features or range of services, the more the value.

Age-cycle and consumers

Teens in colleges have the need to communicate with friends; there may be a generic need for fun and entertainment but transition from college to jobs/higher studies brings in different perspectives with regard to mobile phone usage. While the fun element continues to some extent, the focus shifts to how the services will be useful for different kinds of professions.

This is the point at which the brand has to research and innovate to offer appropriate services to the individual than offer standardised entertainment or other services. When the same consumer has children below five years of age, he requires one kind of service, and with teenage children, the consumer looks for different kinds of information and needs different service content. Nuclear families with both the husband and wife working require a distinctive service content.

The interest in product categories too will be different from the viewpoint of advertisements and promotions that are heard through the mobile service. The concept of permission marketing (that uses the receptivity of a consumer to receive information about a service or product) can be applied effectively along with the age-cycle concept in the area of advertising through the digital media.

Brand symbolism still holds good

One of the challenges for a brand is to stay relevant to the original segment of buyers as they age. Should the brand appeal to loyal, age-old consumers? If so, would the brand imagery hold good for the emerging segment of youth even with new offerings? What about categories that have the cohort effect?

Cohort effect is the effect of growing up at a particular point in time. Music and films are examples that illustrate the cohort effect relevant to aging consumers. The Beatles of the Sixties make headlines in London with a new launch and closer home, millions of Rafi's and Kishore's cassettes/discs find their destination in the nostalgia experienced by consumers who grew up listening to them.

Brand associations, brand symbolism and usage of new brands are some of the challenges that marketers may face in attempting to put age-cycle concept into use.

In a marketing environment that creates several complexities for the brand managers, age-cycle concept will offer a firm direction for brands that believe in concepts rather than just a fanciful blitzkrieg of advertising.

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