People have less cash, but it doesn't need to be bad news for brands

This combination has left many feeling more anxious, stressed, or depressed about money and how they will manage it this year. But while everyone is feeling their budget stretched, the people in their lives are still paying dividends, as we found the role of family, friends and community has become more valuable than ever as a resource for weathering this expensive and uncertain 2024 economy.

To uncover this, Alma’s team of strategists surveyed more than 700 people in the Fall of 2023 to learn more about how they’re feeling during this economic uncertainty. We found that 62% believe the national economy is doing worse today than before the pandemic despite their financial situation being the same or better than it was then. To keep their lives going in this economy, 93% of the people we talked to are making some kind of change to their finances –including spending less, delaying big purchases, or adopting a DIY mindset where they can.

As we dug deeper into the data, it was clear that behind these sacrifices and changes to spending in daily life, there was, at the same time, a coming together of people to make the most of their circumstances. Even though they are spending less on services or things, people are still spending the same or even more time together.

Here are some examples from the research.

● 52% are eating out less, but cooking at home to keep the family together in the kitchen and around the dining table.

● 29% are going out less to bars and/or clubs, but instead they are increasingly going to someone’s home to have a “night out.”

● 20% are canceling holiday travel, but more are choosing to take road trips or fly during off-peak times of the year for vacation and to see family or friends.

While many are entering 2024 with this more frugal and resourceful mindset, it’s not all bad news for CMOs. Consumers are changing their spending in ways that are bringing them closer together, which can be positive for brands who embody this sense of community in their corporation and marketing. What we heard directly from consumers of different ages and ethnicities is consistent with this:

● “It helps to be a part of a community that understands struggles and is not shying away from them.”

● “Having my family with me is something that I value a lot, and that’s helped me to endure this time of economic uncertainty.”

● “… it’s making us feel more connected.”

As marketers think about their strategies for 2024, they should consider what our research found consumers are looking for from brands and incorporate it into their planning discussions:

● 29% of the people we surveyed want to know how brands are helping local communities who are struggling. This means brands should talk more about how their people and profits are benefiting the same communities that are buying their products.

● 45% say they want to hear how brands are supporting social causes, which is an opportunity to align your brand with the hearts and minds of the people choosing between you and your competitors.

● And yes, more than 50% of consumers still want more discounts, promotions and coupons, but the value of demonstrating how your brand is bringing people together and helping those in need has never been higher.

Reduction and changes in consumer spending will be obvious to spot in 2024, but what’s less easy to see will be understanding how those shifts connect brands with consumers and create new opportunities on how to be allies. Ultimately, consumers will buy to meet their needs, but ultimately, these purchase decisions map back to being with and caring for the people they love. The brands that empower and support strengthening those personal connections will come out as winners in this economy and future economies.