CHICAGO, IL--(Marketwire - May 21, 2012) - Today A.T. Kearney's Global Consumer Institute released a study of world-wide spending patterns that addresses how people in different markets spend their money and how their spending changes over time.
A.T. Kearney partner and study co-leader Mike Moriarty said, "This study provides global retailers and manufacturers with critical information for developing their brand and market strategies. Using the insights from the study, brand and product portfolios can be crafted for specific markets based on future consumer spending patterns. Marketing and promotional resources can be modified as necessary to deliver the products and services consumers will demand."
The A.T. Kearney Consumer Wealth and Spending Study is based on a detailed statistical and economic analysis of 70 consumption categories in 86 countries -- over a period of 30 years (1990 - 2020) as well as 3,000+ social/economic variables. Cluster analysis was used to determine the 12 consumption patterns while factor analysis was used to identify key spending drivers. All data for the study was sourced from Euromonitor.
Global wealth and spending have soared since 1990 and will continue to do so. Adjusting for inflation in both unit cost of goods and currency, growth in real spending will increase $12 trillion in the next 10 years. Spending on food will account for about 10 percent of this sum.
According to Hana Ben-Shabat, A.T. Kearney partner and study co-leader, "One of the key findings of the study is that consumers behave predictably as a country's wealth increases and consumption patterns mature. The study found that there are 12 spending patterns globally that are distinct, concise and have been stable over a long period of time."
Vishwa Chandra, A.T. Kearney principal and study analyst, added, "Throughout our study, we found demographic metrics that had a positive -- or negative -- impact on consumer spending regardless of country, category, or time period. These metrics relate to population, labor and education, and the business environment, and reveal some interesting correlations. For example, we found a strong negative correlation between unemployment rates among females, smoking rates among males, and spending on personal care."
Based on spending analyses by country, the study identified four consumer groups whose spending is linked to economic development. These groups are identified as Basic, Emerging, Escalating, and Established. Within these groups, consumer spending differs based on income level and needs, sometimes in unexpected ways. While the poorest consumers spend the highest proportion of their money on the necessities to survive -- food and juice for example -- they are also the highest spending group on tobacco. The richest consumers have a higher percentage of discretionary spending, and dominate not only such categories as hotel stays and financial services, but also hospital and outpatient services, as well as newspapers and magazines.
Strategic Insights for Consumer Goods Companies and Retailers
As consumer spending increases worldwide over the next decade, consumer goods companies and retailers need to understand how to tap into this $12 trillion opportunity. Understanding these spending patterns will help business leaders:
- Understand which products consumers will be more likely to use without customization
- Reevaluate and reassess their product portfolios within specific countries to identify expansion opportunities
- Align marketing and promotional resources with products and categories that consumers are more likely to prefer
- Transfer best practices across borders among countries with similar spending
- Take advantage of major, disruptive change in upcoming spending pattern transitions
To view the A.T. Kearney Consumer and Wealth Study Report go to www.atkearney.com.
About A.T. Kearney
A.T. Kearney is a global team of forward-thinking, collaborative partners that delivers immediate, meaningful results and long-term transformative advantage to clients. Since 1926, we have been trusted advisors on CEO-agenda issues to the world's leading organizations across all major industries and sectors. A.T. Kearney's offices are located in major business centers in 39 countries.
About the A.T. Kearney Global Consumer Institute
The A.T. Kearney Global Consumer Institute is a worldwide network of professionals and executives. The Institute combines proprietary and public data resources with local knowledge to deliver strategic and operational insights to executives in consumer-facing industries seeking long-term growth and competitive advantage. For more information, please contact firstname.lastname@example.org.