– BMK501-Marketing Management
Case Study Analysis
I. EXECUTIVE SUMMARY
The shift in consumers’ behavior and attitudes today is attributed to a number of important global developments. Chief amongst those are the changing demographics as we head towards an increasingly aging population while at the same time we are witnessing the rise of a new consumer group - the “Generation Y” or the Millennials that threaten to dictate the new rules in buying and doing business.
Notably too is the impact of an increased level of wealth and affluence amongst consumers before they were crippled by the recessionary effects of the 2009 Global Financial Crisis. Globalization and the pervasive internet and digital technologies have become the two most powerful forces re-shaping our family lives and in redefining how they communicate, socialize and shop.
This analysis goes on to trace the causes of these global developments and the impact exerted by the Millennials and the “carer” role as required for our aging population. The other silent cause, the viral ability of social media tools comes under our scrutiny. At least five alternative solutions backed by their respective decision criteria packed our fourth section before we conclude with four recommended solutions, its implementation together with their justifications.
II. STATEMENT OF PROBLEM
As a result of recent global events, there is a dramatic shift in consumer attitudes and behaviors. Chief amongst these profound changes and impacts include the following: a. Changing Global Demographics – these are sub-divided into three sub-categories: i. Increasing Life Expectancy - life expectancy is forecasted to increase three and five-fold times for those in the 60 and 80 years old and more categories respectively. In absolute terms, we are getting ready for an aging population which is expected to increase from 606 million to 2 billion; and 69 million to 379 million for the respective age groups. ii. A Rise in One-Parent Families – there is a significant rise in one-parent families today. For example in Australia, this is forecasted to rise from 1.8 million (2001) to 2.8 – 3.7 million (2026). This syndrome is contributed by those shying away from marriage and those delaying marriage. iii. Increased Wealth & Affluence – there has been a significant rise in earned incomes (and disposable incomes) both from the aging “baby boomers” (those born after the World War Two between 1946 and 1964) due to their seniority and their higher take-home pay thereof; and the higher entry salary packages of the better skilled and qualified Gen Ys or Millennials (those born between 1977 and 1997). This combined effect has brought about a higher unprecedented aggregate demand for goods and services never seen before for their respective market segments before this.
b. Uncertain Global Economic Outlook – Globalization which is a result of the phenomenal increase in international trade, global trade and the wide-world exchange of information meant that our national economies are all intertwined and inter-dependent. This has translated the impact globally via a chain effect. In the last decade alone, we have witnessed two major market crashes, the biggest single terrorist attack (on 11 September 2001) two wars, two deadly pandemics and the bursting of no less than three global economic bubbles (dot-com, property and now the 2009 credit crunch). The recent global financial crisis which is the most severe since the Great Depression has dampened consumers’ confidence worldwide making them more pessimistic and selective in their buying decisions to maximize their incomes and their choices.
c. Global Family in the Digital Age – The internet has been all-pervasive. Media Metrix in 2006 reports that there are some 718 million internet users who daily accounted for some 1.9 trillion page views. And in marketing and buying terms, more than half of online users made...