Pazaren kompas 2010 - Lifestyle in crisis

Bulgarian lifestyles

2010

The only holistic lifestyle analysis of Bulgarian consumers

Market Compass

How is the weather forecast prepared?

• Intensive data research...

• Very precise geographic maps

• Very good understanding of the interactions between various weather fronts and an area's relief

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Market Compass

What do the weather and marketing have in common?

Because we are all in the forecasting business

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Market Compass

Market Compass is ...

Trend analysis ...

...which answers not only the question "What's happening in the market?" but also ...

WHY?

...which makes possible to forecast and conduct strategic analysis

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Market Compass

The Market Compass team

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Market Compass


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Market Compass

Lifestyle

• A marketing approach "as old as the world"

• We all know that demography is just the beginning... and that we all study consumers' lives, thoughts and values

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Market Compass

Lifestyle

However, in the context of the business problems we solve, the starting point are the products and services we sell

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Market Compass

Lifestyle - limitations

• Atypical (non)consumers?

• What living environment surrounds our products?

• Under what changes would they enter or leave the shopping baskets of consumers?

• What are the other products with which they complete for the consumer's budget?

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Market Compass

Lifestyle

Because consumers are not rational and they are not consum-ers... They just live their lives the way they can, to their best

understanding

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Market Compass

Lifestyle is a way of life, not consumption patterns

• Lifestyle is a characteristic set of behaviors that makes sense for everyone as well as for a specific person at a given time and place including: social interactions, consumption, entertainment and clothing style.

• The behavior and practices in the way of life are a combination of habits, common ways of doing things and deliberate actions.

• Lifestyle is a reflection of the predispositions, values and world outlook of a person.

• Not all aspects of lifestyle are desired. The social and technological systems that surround a person limit his/her choice in life.

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Market Compass


1. Predispositions, values, outlook - the factors that drive the differences in lifestyle

2. Consumption, clothing style, free time - describe the differences in lifestyle

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Market Compass

Lifestyle map of Bulgarian consumers

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+

-

Социално

положение

Чувство за

принадлежност

+

-

Чувство за


АктивниСоциално

положение

+

-

Доволни

Чувство за


Социално

положение

+

-

БезразличниСоциално

положение

Чувство за


+

-

ПасивниСоциално

положение

Чувство за


+

-

ПозитивниСоциално

положение

Чувство за


+

-

ЗатворениСоциално

положение

Чувство за


+

-

НеприемащиСоциално

положение

Чувство за


+

-

Attitude towards the world and new

technologies

Sense of belonging

Social status

Market Compass

Disproves stereotypes

• People in Sofia ....

• People who live in countryside villages ...

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0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Village

Town

City

Sofia

Active Content Indifferent Passive Positive Confined Rejective

Market Compass

• A way to plan and think about the communication of our products outside the conventions of the specific product category

• Helps us think and generate ideas about new products and services that go beyond their category

• Gives us a chance to integrate our products or brands more naturally in the lifes of our target customers

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What does Market Compass give us?

When we study the influence of the economics crisis on society, we usually talk like this:

Market Compass

Impact of the crisis

Half of Bulgarians believe that their households have become worse off economically during the last year

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4%

50%

43%

3%

Can't estimate

Worse off

Did not change

Better off

How did the economical status of your household change during the last year?

Market Compass


The impact has been strongest on people with the lowest incomes

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0%

1%

5%

10%

66%

57%

41%

28%

Up to 400 leva

401 - 800 leva

801 - 1500 leva

Above 1501 leva


Worse off Better off

Market Compass


People with low income lose their jobs. The salaries of high income people have decreased.

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11%

8%

6%

6%

7%

11%

12%

9%

Up to 400 leva

401 - 800 leva

801 - 1500 leva

Above 1501 leva


My salary was decreased I lost my job

Market Compass

Impact of the crisis in 2009 and expectations for 2010

Postponement of big purchases, shifting to cheaper brands, buying on promotions.

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45%

51%

64%

I shop on promotions more frequently than as

usual

I go to restaurants more rarely than as usual

I started buying cheaper products and brands

What happened in 2009?

41%

50%

61%

…will go to restaurants more rarely than as usual

…will shop on promotions more frequently than as

usual

…will start buying cheaper products and brands

Bulgarians' expectations for 2010

Market Compass

The crisis through the lenses of Market Compass

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Rejective

Confined

Positive

Passive

Indifferent

Content

Active

Sense of belonging

Attitude towards the world and new

technologies

Social status

Market Compass


People with the lowest social status complain the most

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2%

1%

2%

4%

3%

5%

9%

70%

60%

57%

44%

44%

40%

21%

Rejective

Confined

Positive

Passive

Indifferent

Content

Active


Worse off Better off

Market Compass


Income per household decreases in segments with mid- to high social status

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Comparison of household income in various groups - 2009 vs. 2010

Year Active Content Indifferent Passive Positive Confined Rejective

2009 2160 1180 1160 980 650 460 460

2010 2200 1100 1100 970 670 530 480

Diff. in % +2 -7 -5 -1 +3 +15 +5

Market Compass


The higher the social status, the more active the spending by consumers

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Purchase of products in 2009


Market Compass


What happens during crisis?

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Market Compass


Less spending in segments with higher social status and vice versa

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But is it sufficient to look only at social status in order to explain the influence of the crisis on consumption?

Market Compass


We will look in more detail at the change in behavior of the Active segment

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Comparison of household income in the various segments - 2009 vs. 2010

Year Active Content Indifferent Passive Positive Confined Rejective

2009 2160 1180 1160 980 650 460 460

2010 2200 1100 1100 970 670 530 480

Diff. in % +2 -7 -5 -1 +3 +15 +5

-1% AVERAGE CHANGE IN INCOME FOR ALL SEGMENTS

Market Compass


• just over 8% of the Bulgarian population above 15 years of age

• very high social status

• striving for development, particularly ambitious

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Ambitious and successful, open to the world, high social

statusA and B class

In 2010, they become much more cautious in their market behavior

Active:• consider carefully their

purchases• spend moderately• save

Active

Market Compass


The reaction of this segment to the crisis is demonstrated most clearly in the change in consumption for daily product categories

such as food and drink.

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Active

72

82

69

74

18

66

47

85

93

83

90

35

90

68

58

72

57

74

11

58

38

Milk Yogurt Meat Processed meat Conserved/ Frozen vegetables

Fresh fruit Pastries

Active 2010 Active 2009 All 2010

%

Market Compass


The Active segment has also decreased spending on most non-food products.

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19

68 69

62

47

1516

7672

77

64

16

11

4440 40

31

4

Mobile phone Clothes Shoes Cosmetics Perfumery Jewelry


%%

Active

Market Compass


The Active feel more unsecure about their future and they have started caring actively for it.

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18

20

36

24

1112

29

18

7

9

15

13

Life insurance Deposit in private pension

fund

Credit card Savings account


%

Active

Market Compass


• How do we react in a crisis?

• It depends not so much on social status but more on our perspective on life.

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Market Compass


• Despite bad weather - life goes on

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48

16

48

15

23

38

11

38

11

16

Internet access at

home

Notebook computer Desktop computer I consume products

with proven origin

I read the

ingredients on the label of the product

All 2010 All 2009

%

Market Compass

When we understand the people we call our target

consumers...

• We will truly understand why they are our customers

• What changes in their life and environment would alter their choic

• Who are the consumers who would become our new customers, because of such changes?


2010

The only holistic lifestyle analysis of Bulgarian consumers

Pazaren kompas 2010 - Lifestyle in crisis

Business

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