From Conspicuous Consumerism to Experiential Consumption: The Consumer of the Future
Buoyed by the rise of the Middle Class during the last 25 years and the bandwagon effect created, consumer behaviour has reflected a strong shift towards conspicuous consumption. Louis Vuitton, Porsche, Rolex, Jimi Choo, Channel and a host of luxury and semi-luxury brands have capitalised on this trend by profiting from consumer ego and helped to inflate it. Possession of these brands and similar ones have exemplified what it means to belong to an exclusive social circle. They represent the status symbol that consumers require to send signals and impress their friends. In the last few years, the internet and demographic changes; and in the post-recession period, the sharing economy, has helped to deconstruct and again reconstruct the notion of consumerism.
Similarly, the sharing economy and its appeal has exemplified the recent shift in the notion of consumerism and its new trends. In the sharing economy, consumers are no longer acting selfishly and consuming for the sake of impressing their social circles; rather, they want to consume along with their circle and share the excitement of the experience that they encounter. The internet has also opened consumers eyes to a plethora of product choices and responds to their demands for convenience and immediacy rather than the hedonistic values of status and exclusiveness. Abetted by the internet, in most cities, retail is now nearing an apocalypse and luxury consumption is fast losing its lustre.
Driven by these forces, consumers now have nuanced ways of signalling belongingness to their social circles, and have moved on towards the pursuit of values related to happiness and well-being. Today, they want to experience something different, engaging and exciting. The modern consumer does not merely want to visit the museum for the sake of learning about the past; there are many history lessons on the internet free of charge. Rather, they want to travel back to history in 3D and experience the future in immersive reality. More than ever, more consumers are drawn to dining spots that provide more than culinary offering; they care about the processes and environment that surrounds the culinary experience before, during and after their meal.
Consumerism is not dead at all; today’s consumers still want to satisfy their ego through tailored, personalised experiences that are unique, gratifying and engaging. It has only shifted from the desire for material to the pursuit of pleasure. To capture these opportunities, cities, brands, organisations and destinations now respond with festivals, concerts, open competitions, experiential activities and a plethora of social experiential events to grab the attention of the modern consumer. In cities, arts centres, theatres, museums and attractions are responding through immersive VR and augmented technologies that seek to immerse guests in unique experiences. Restaurants will now serve dinner in the sky, and some theme parks have started thinking about providing digital VR experiences.
But here lies the problem.
Experiential consumerism is not likely to last for too long, and businesses will have to deal with consumers’ complex behaviours in the coming years more than ever before.
The addition of Gen Z’s to the consumer generation will make customer behaviour more difficult for brands to understand. Banks, theatres, retail, hotels, tourism destinations, theme parks and attractions; many of whom have already been left behind, will become further obliterated in the years ahead. After retail, banks and theme parks will become the next major casualties because of their failure to respond to the demands of experiential consumerism.
Physical banks that will remain in the next 15 years are those that will be able to rethink and redesign how to match up with consumer’s experiential behaviours by capturing elements of speed, engagement, emotion and convenience. Similarly, theme parks and attractions that will exist in the coming years will be those that can offer digitally oriented experiential activities to their guests through immersive technology that will educate, engage and evoke positive feelings and emotions. The consumer of the future will not need to physically climb a 100ft ride at a theme park made of iron and steel. The theme park of the future will be the hotspot of entertainment and the place where consumers experience immersive fun, but also socialise, learn and become technologically empowered. The consumer of the future will stay true to brands that can empower and provide opportunities for them to socialize, learn and grow.