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Targeting Emerging Consumer Segments The Conscientious Consumer

Datamonitor
January 8, 2010
77 Pages - SKU: DFMN2579101

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Introduction

Regardless of affluence, Conscientious consumers have emerged from the recession with the flexibility to repay their debts on time every month, and this reliability along with other key attitudes and behaviours mean they are represent a valuable segment for FS providers to target. Providers must understand what these consumers want and how their Conscientious status influences their behaviour.

Scope

Using data from our global FSCI survey this report profiles the attitudes and behaviours of the emerging Conscientious consumer segment
The report identifies these consumers and analyses the drivers of their future behavior
The report provides concrete actions for FS providers to position themselves competitively in order to capture a share of the Conscientious wallet

Highlights

Their appetite for notice savings accounts matches that of instant access savings, and yet a significantly higher number look to other providers for this product. The apparent preference for holding instant access savings products with the primary bank is therefore misleading.

Though seemingly debt-averse, Conscientious consumers have more credit cards than the average consumer. Since Conscientious consumers pay off their debts every month, this would therefore imply that they are attracted to credit cards for some other purpose not because they require credit, but because their credit cards offer some other value.

The very term 'Conscientious' implies concern for more emotive factors surrounding product choice. Datamonitor's findings confirm that green or ethical concerns are a key part of the value they seek in their products, and this is significantly more important to this segment than it is to the average consumer.

Reasons to Purchase

Access the results of Datamonitor's Global FS Consumer Insight survey in order to profile this key emerging Conscientious segment.
Identify why the Conscientious consumers are potentially the most profitable segment and predict their future behaviors.
Identify strategies you can take to effectively gain share of the Conscientious wallet.

OVERVIEW: Catalyst; Summary; Methodology; Table of Contents; Table of figures; Table of tables; Introduction; Customer segmentation is vital for an effective marketing strategy; The recessionary environment is forcing providers to make tough decisions; Identifying fads as opposed to long term trends is important; Conscientious consumers are a valuable target for providers
The Future Decoded: Trend: Lower numbers of Conscientious consumers have emerged than expected; Insight: Financial pressures do not dictate Conscientious behavior; Conscientious consumers are found in the fastest growing emerging markets; Higher number of Conscientious consumers in China are due to reinforced confidence about the state of their economy relative to others and builds on cultural foundation of prudence; Russia has disproportionately few Conscientious consumers compared to other emerging economies; Insight: Demographic and lifestage findings have had some bearing on the emergence of Conscientious behavior; The emergence of Conscientious behavior has been more prevalent amongst younger Accumulators; Australia has a surprising number of older Conscientious consumers; Japan has no young or old Conscientious consumers; Employment status has also influenced the emergence of more conscientious behaviour; Australia contains significantly more recently unemployed Conscientious consumers than elsewhere; Demographic and lifestage influence should not be overstated; Trend: Conscientious consumers have a greater appetite for FS products than the average consumer; Conscientious consumers in the UK are particularly receptive to instant access savings accounts; Notice savings accounts in India are more popular than elsewhere; Life insurance is relatively unpopular in Australia; Credit cards are most popular amongst Conscientious consumers in Japan, Singapore and the US; Insight: Though seemingly debt-averse, Conscientious consumers have more credit cards than the average consumer; Conscientious consumers favor pre-paid cards more than most; Conscientious consumers are predictably attracted to savings and insurance products; Conscientious consumers are likely to be regular savers; Conscientious consumers have more pensions and life insurance as well as travel, home and health (etc) insurance; Insight: Conscientious consumers are financially intelligent; Conscientious consumers apply financial intelligence to their product choices, and are keen to shop around; Conscientious consumers are also price-driven; 'Conscientious' does not mean 'risk-averse'; Conscientious consumers in all countries are financially aware; Conscientious consumers in the US are more Conscientious than others; Conscientious consumers in Australia, Japan and Singapore are actually slightly less financially intelligent than average; Brazilian and Indian Conscientious consumers are at odds in terms of financial awareness; Insight: Conscientious consumers still have higher than average product holdings with their primary bank and represent a key cross-selling opportunity; Conscientious consumers in France are by far the most loyal to their primary bank; There is still an opportunity for non-primary bank providers to capture share of the Conscientious wallet; Insight: Conscientious consumers are more trusting than the average consumer; Conscientious consumers have had less negative experiences; Conscientious consumers in different countries feel different about governmental and bank responses to the crisis; Conscientious consumers in the UK and US feel very differently about the way the crisis has been handled by their banks; Conscientious consumers in China and Singapore are positive about governmental control and confident that their banks are protecting their money; Insight: Conscientious consumers are receptive to financial advice through a wide variety of sources; Conscientious consumers can afford professional advice but still shop around for the best deals; For new players entering the industry, proof of financial stability is vital; The Conscientious segment are particularly drawn to products with green or ethical credentials; Conscientious consumers in all countries like a wide variety of sources of advice available to them, but cross-country preferences differ; Conscientious consumers in the US are comfortable making their decisions through online research rather than using other sources of advice; Australian Conscientious consumers are comfortable with their financial decisions despite not being overly receptive to advice; Chinese CC's are receptive to all forms of advice; Trend: Conscientious consumers are optimistic about the future; Conscientious consumers have had a better than average experience over the last 12 months; Insight: Conscientious consumers' future actions are aligned with their positivity; Conscientious consumers intend to pay more into their savings but cut back on insurance premiums; Conscientious consumers also plan to maintain their quality of life; Conscientious consumers in all countries are disinclined to spend more money in the future but attitudes towards savings for the short-term and investing for the long-term vary; Australian and German Conscientious consumers would rather focus on long-term rather than short-term savings; Conscientious consumers in the UK are still disinclined to save for either the short- or long-term
Action Points: Action: Emerging markets can provide valuable lessons for FS providers; Action: Target Conscientious consumers with innovative regular savings products; Financial stability is of biggest importance to the Conscientious segment; Do not offer them high cost / low risk products; Action: Datamonitor's Megatrend Framework can help identify strategies for targeting this segment; Target Conscientious consumers through the Comfort Megatrend; Conscientious consumers desire elements of the Connectivity Megatrend in their financial needs; Harness new connective technology; Experiment more boldly with Web 2.0 technology; Ethical consumerism is a key component of the Connectivity Megatrend; Capture Conscientious consumers through highlighting the Convenience of the offering
APPENDIX: Data tables; Methodology; Definitions; The Datamonitor Financial Services Consumer Insight Megatrend Framework; Authenticity; Comfort; Connectivity; Convenience; Individualism; Wellbeing; Demographic Complexity; Financial Intelligence Complexity; Lifestage Complexity; Wealth Complexity; Further reading; Ask the analyst; Datamonitor consulting; Disclaimer
List of Tables: Table 1: Conscientious and Non Conscientious consumers segmented by country; Table 2: Degree to which household financial situation has worsened over the last 12 months versus percentage of Conscientious consumers, segmented by country; Table 3: Conscientious consumers segmented by age; Table 4: Conscientious consumers segmented by age and country; Table 5: Conscientious consumers segmented by employment status; Table 6: Conscientious consumers segmented by employment status and country; Table 7: Average product holding amongst Conscientious and global consumers; Table 8: Product holdings amongst Conscientious and global consumers (those with two or more); Table 9: Instant access savings holdings amongst Conscientious consumers, segmented by country; Table 10: Notice savings account holdings amongst Conscientious consumers, segmented by country; Table 11: Life insurance holdings amongst Conscientious consumers, segmented by country; Table 12: Credit card holdings amongst Conscientious consumers, segmented by country; Table 13: Indicators of financial intelligence amongst Conscientious and global consumers; Table 14: Indicators of financial intelligence amongst Conscientious consumers, segmented by country; Table 15: Non current account primary bank product holdings amongst Conscientious and global consumers; Table 16: Non current account primary bank product holdings amongst Conscientious consumers, segmented by country; Table 17: Products held with primary bank amongst Conscientious and global consumers; Table 18: Indicators of trust amongst Conscientious and global consumers; Table 19: Opinion of bank handling of the crisis and governmental intervention amongst Conscientious consumers, segmented by country; Table 20: Steps before making financial decisions amongst Conscientious and global consumers; Table 21: Steps before making financial decisions amongst Conscientious consumers, segmented by country; Table 22: Expectations for the future amongst Conscientious and global consumers; Table 23: Actions over the next six months among Conscientious and global consumers; Table 24: Actions over the next six months among Conscientious consumers, segmented by country
List of Figures: Figure 1: Lower numbers of Conscientious consumers have emerged than expected; Figure 2: Financial pressures do not dictate Conscientious behavior; Figure 3: The emergence of Conscientious behavior has been more prevalent amongst younger Accumulators; Figure 4: Australia has a surprising number of older Conscientious consumers; Figure 5: Employment status has also influenced the emergence of more conscientious behaviour; Figure 6: Australia contains significantly more Conscientious consumers who are recently unemployed than elsewhere; Figure 7: Conscientious consumers have a greater appetite for FS products than the average consumer; Figure 8: Conscientious consumers are almost doubly likely to have two or more of each product than the average global consumer; Figure 9: Conscientious consumers in the UK are particularly receptive to instant access savings accounts; Figure 10: Notice savings accounts in India are more popular than elsewhere; Figure 11: Life insurance is relatively unpopular in Australia; Figure 12: Credit cards are most populat amongst Conscientious consumers in Japan, Singapore and the US; Figure 13: Conscientious consumers are financially intelligent; Figure 14: Conscientious consumers in the US are more Conscientious than others; Figure 15: Conscientious consumers in Australia, Japan and Singapore are actually slightly less financially intelligent than average; Figure 16: Brazilian and Indian Conscientious consumers are at odds in terms of financial awareness; Figure 17: Conscientious consumers have higher than average product holdings with their primary bank; Figure 18: Conscientious consumers in France are by far the most loyal to their primary bank; Figure 19: There is still an opportunity for non-primary bank providers to capture share of the Conscientious wallet; Figure 20: Conscientious consumers are more trusting than the average consumer; Figure 21: Conscientious consumers in the UK and US feel very differently about the way the crisis has been handled by their banks; Figure 22: Conscientious consumers can afford professional advice but still shop around for the best deals; Figure 23: Conscientious consumers in the US are comfortable making their decisions through online research rather than using other sources of advice; Figure 24: Australians are not keen to take advice from family and friends; Figure 25: Conscientious consumers in Brazil are most confident in seeking advice from their primary bank; Figure 26: Conscientious consumers' are optimistic about the future; Figure 27: Conscientious consumers intend to pay more into their savings but cut back on insurance premiums; Figure 28: Conscientious consumers in the UK are still disinclined to save for either the short- or long-term; Figure 29: SmartyPig has created an innovative savings platform; Figure 30: ING Direct has employed innovate use of Web 2.0 technology; Figure 31: SmartyPig has also harnessed Web 2.0 and social networking to appeal through Connectivity; Figure 32: Virgin's Climate Change ISA is a prime example of ethical and green credentials

Targeting Emerging Consumer Segments The Conscientious Consumer

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