neweconomy 300x188 - New Economy, New Consumer


New businesses will have failed to notice that consumers are different these days. They have become more knowledgeable, more demanding and less dependable. These changes are of great significance, but, first, it is helpful to look at the background from which they have sprung.


Advertising in its earliest form was promoted by the industrial revolution in the 18th century. As manufacturing hit its stride on both sides of the Atlantic and products rolled off assembly lines, firms needed ways to stimulate demand for the goods they were making. Mass advertising started to appear in the 19th century and took off in the 20th. The consumer society that emerged was one where products and services were clearly branded, and brands were designed to reflect appealing values in a bid to differentiate them in the mind of the average shopper. Emotive characteristics were attributed to goods: “if I buy this soap, I will be happy”. Marketers promoted a lifestyle that people were encouraged to aspire to. Advertising was in the business of selling dreams.


From dreams to reality


But the industrial age has given way to an information age, and today consumers are increasingly aware of the wiles and ways of clever marketers and slick advertisers. Mass production is no longer the dominant feature of the economy. The proliferation of the internet has made cultural and geographical barriers seem insignificant. Globalisation has meant that brands such as Coca-Cola, McDonald’s, Microsoft, and Apple. are known throughout the world.

As Naomi Klein points out in her book “No Logo”, many companies have been focusing more on creating a strong brand than on creating a strong brand than on the product itself. There is no better example of this than the explosion of advertising generated during the dotcom boom of 2000. All the companies shared the same desire – to establish their name as a trusted entity in the minds of potential consumers. With many of them, the service offering turned out to be secondary to the image and perceived standing in the marketplace.

The hard business facts are that consumers are becoming more intelligent in their reading of marketing messages and more discerning in their purchasing. the internet has made it much easier to these products and prices, and, in general, distribution channels and more easily accessible information. Consumers are also becoming more intolerant of standards they find unacceptable – for example, age-old practices whereby cheques paid in take several working days to clear while a debit or credit card and Internet transaction with a bank takes place almost instantaneously.

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