Most of us believe we are pretty much like everyone else because we are pretty much like else everyone we know. However, this is almost certainly a false view of the world because of our very limited view of the world. Everyone we know is pretty much like us because we hang out with people pretty much like us. Statisticians call this a truncated sample. It is the goal of researchers in marketing to either look deeply into narrow samples of the market or to broaden the view much beyond what any one of us would likely to experience directly in our lives.
This interesting new book talks about what has happened to the middle market consumer who doesn't have enough to live upscale, but is certainly willing to be selective and can trade up market on items that matter to her and down market to find very satisfying purchases that also leave them the funds to splurge on higher ticket items and services. The idea is that for these folks, who have pretty decent incomes (especially when combining two incomes), and also have their spending under control, view shopping as an entertainment and finding what they want as a kind of adventure. The experience of finding something just right for less money is emotionally rewarding in a similar way to indulging the $600 designer purse is when they decide to go up market.
Michael J. Silverstein of the Boston Consulting Group (and his co-author, John Butman) take us into the budget and spending lives of several different representatives of this middle market segment and then into the some business case studies to show us the problems some face being stuck in the middle, how others are revitalizing themselves, and how some have successfully exploited this rewarding group of consumers.
Fundamentally, the issue is this. In the old days, manufacturers could make what they wanted, define the segment on their own, market to it, and sell everything they made. That doesn't work anymore. There are just too many choices. And the seemingly infinite number of choices for the consumer are not simply about direct competition. Substitution of emotional satisfaction can count as much as the function of the item. These consumers are looking for things in addition to the item itself and will buy from the vendor that provides them with the sense of having found the price and emotional value they are after.
Interesting read, especially for those involved in marketing to this segment.