BCG: Consumers' Recession Mentality Remains Strong

Consumers in developed markets exhibit a deeply ingrained "recession mentality," feeling financially insecure and prepared for a prolonged period of low or no income growth, according to a 2012 survey by The Boston Consulting Group (BCG).

The eleventh annual Consumer Sentiment Survey, which polled over 22,000 consumers across 16 countries, revealed that anxieties in many markets were at or near peak 2008-2009 levels. Key findings indicated consumers blamed governments for economic turbulence, expressed widespread pessimism about the pace of recovery, and faced job loss fears, particularly in the U.S. and Europe where one in four respondents worried about their employment.

Few in developed nations believed their children would have a better life compared to those in China and India, where optimism was higher. Values such as saving money and staying healthy gained significant importance, while spending on luxury goods declined. China represented a relative bright spot, though some consumer segments there also reported increased anxiety.

This pervasive pessimism presented opportunities for companies capable of innovating to offer lower-cost solutions, segmenting customers effectively, and providing "affordable luxuries." The study identified three key consumer behaviors likely to result: investment in education, increased savings, and a focus on value.