Do consumer behaviours change over time? And if so, how they change?
I attended an executive brief session and was asked a question about whether and how millennials’ purchasing behaviours will change when they grow older in China. It is a very good question and a very challenge one to answer by many companies if their products target certain age groups. I reflected on my personal experience to share some of my opinions.
My overall view on the purchasing behaviour change, particularly relation to the product or service being consumed and their marketing / distribution channels, is that it will occur under the following three conditions:
- Change is aligned with consumers’ life style changes and thus new/different needs.
- Change leads to higher perceived value or less expensive products to satisfy with consumer’s same needs.
- Change leads to more convenience in consuming a product or service to fulfil the same needs.
Reflecting on my personal experience in China and some additional research, I can see examples of which consumer behaviours changed overtime and other examples that behaviours didn’t change much. I listed some of them below which I considered influenced my overall view.
Music vs. Ways to consume music
Like many people I have a good collection of music libraries. Yes, every-now-and-then I also add new music into the libraries, but I seldomly delete any because I still like the song I liked 10 years ago. Different people may have different preferences of type of the rhythm or genre. Research (https://pdfs.semanticscholar.org/4240/609dc87008c65c7825ce71c6f471ea55913a.pdf) shows that people preferences of music are reasonably stable over a long period time even more so when people are getting older, mainly because the preferences are influenced by personality characteristics. Conceptually, I can see changing of music types do not strongly correlate with any of the three conditions I mentioned prior.
On the contrary, I believe we will all agree that the way to consume the music has changed significantly for all age groups in the last three decades from CD to MP3 devices to iTunes like services and now Online music services like Spotify (Spotify’s user base growth: https://www.businessinsider.com/spotify-reaches-new-subscriber-milestone-2017-8/?r=AU&IR=T) (Note: in China, for many reasons, there are alternative services similar to iTunes and Spotify to provide popular music download and steaming services.). The content purchasing, and delivery channels have all experienced significant changes as a result. I see the change strongly correlates with all three conditions being met: 1. consumer’s life style changed as people listen to music at more occasions – because of the proliferation of the inexpensive mobile devices with high quality personal audio accessories. 2. Consumer can spend less to purchase individual tracks they like and can even listen to music for free providing they are willing to listen to advertisement. 3. Access to music is easier than ever before. Now it can be pretty much speaking to a smart speaker, which will automatically tell who you are based on your voice and get the online service to play recommend music according to personal preferences.
Phone purchase, smart phones vs. feature phones
Apply the three-condition test to digital devices like smart phones, I can explain the reasons why in recent years smart phones are embraced by old generations (60s+) in the market like China and feature phone market share is keep shrinking (https://www.statista.com/statistics/225321/global-feature-phone-and-smartphone-shipment-forecast/).
Firstly, the lifestyle changes including using digital channel to communicate with relatives and friends finally start occurring among old generations. According to the CAICTR WeChat economic and social impact report 2017 (https://walkthechat.com/wechat-impact-report-2016/), older generations (60s+) proportionally use more data on social media app like WeChat to keep in touch with others. Those social media apps require user to take procession of Android or IOS based smart phone devices.
Secondly, as the manufactures ramping up the production volume of key components of smart phones, the quality improves and price drops because of economy of scale and supply surplus. The average price of smart phones with a decent hardware / software specification dropped significantly in Asian market including China (https://www.androidauthority.com/next-billion-smartphones-trends-619307/). Spending less, consumers can now enjoy more values from those devices.
Finally, smart phones offer users almost instant access to digital content. They help older generations to get touch with relatives and friends and thus meet their social needs with more convenience.
All of those explain why the mobile phone purchasing decision of old generations changed from feature phones to smart phones in recent years even though consumers may need to pay extra for the data services.
Social media vs. Art work and gourmet
The conclusions of previous examples are largely based on historical data. If I apply the three conditions on other products / services, I believe I can also construct some hypothesis.
First hypothesis I will make is about social media. I believe the social media usage behaviours will change per age groups as part of lifestyle changes (e.g. having family, kids, busier at work etc.). The social media behaviours may change among same age groups, particularly among the younger age groups, for they may not have formed a strong and stable lifestyle, yet they are more attached to novelty and convenience brought by new products and services.
Using two real world examples, I would infer that when younger generation getting older, they will start to use more non-real time social network (such as Weibo, a China blogging platform with 7.2 percent of microblog users of Weibo in China were 50 years or older in year 2016 https://www.statista.com/statistics/320940/china-microblog-weibo-user-breakdown-by-age-group/ ), less real-time ones (like QQ – China’s close equivalent to snapchat).
Among the younger generation, there are social media newcomers fulfilling their needs of self-expression and demonstration of independence. Providing they can grow user base to meet the users’ basic social interaction needs and are easy to use, they can probably grab some market share of younger generations.
Art work like gourmet is another piece of puzzle I try to draw a hypothesis upon. I believe the fundamental needs associated with the acquiring of art work and gourmet is for self-expression, cultural and experience acknowledgement under given social / cultural context. There are many factors that can influence such kind of complex needs. To a certain extent, the convenience of purchase and lifestyles are far less determining factors than the perceived value of the actual products. For a younger generation, because their needs of self-expression usually outweigh their needs of cultural and experience acknowledge, I can argue they are likely to make predictable purchase decisions if products and services are self-expression oriented and well fit in a trendy social context (remember young generations are more attracted to novelties). When they grow older, they may change their purchasing behaviour to acknowledge more of their cultural and experience backgrounds. Moreover, as the overall social / cultural context changes over medium-to-long period, old generations could be influenced to adjust their purchasing preference as well.
What are the implications to the marketing to China? Soon I will follow up with another post to elaborate more.
