The most important driver of consumer behaviour
In this blog, we use behavioural economics to explain why a person’s work-life stage is most likely to determine their consumer behaviour. We focus on three stages that typically have the biggest impact on an audience’s mindset.
We hope to make this interesting by moving beyond conventional theories of defining markets. In doing so, we make the assumption that you already have some knowledge of how to do this, but we’ve developed a comprehensive guide of the fundamentals if you’d like to read it first.
Work-life stage
As it sounds, work-life stage refers to the work stage in life that people find themselves in. There are many variants of this, so for the purposes of this blog we consider those most relevant to marketers and specifically three work-related life stages that people find themselves in. They are linked to age, but increasingly loosely so as society becomes more fluid and jobs become increasingly unstable.
The stages are so important as they influence both demographic factors such as age, location, and salary as well as psychographic aspects such as personal interests, media interests and personal drive. We therefore believe them to be the most significant determinant of a person’s consumer behaviour.
So, for example, if you are asking someone a question about themselves, the quickest way to empathise with them would be to understand which of the following three life stages they are in. This certainly does not mean that this information can predict that much about each individual personally, but it provides a foundation from which to better find this out. Moreover, but taken at a group level, it is highly valuable.
Student
The vast majority of students across the world go to university after finishing secondary school. However, times are changing, as retraining is increasingly required due to changes in the work environment, and careers rarely lasting a lifetime.
Students all share key behavioural similarities, irrespective of their age or education level. They have the greatest control over their time, and the greatest spare time. However, they are often cash strapped, which often means requiring second jobs, relying on discounts and being very sensitive to price changes in basic goods and services. Moreover, they are more positively engaged in society and their futures. And perhaps most significantly, they are more likely to read the news and keep up with societal events.
Career-oriented
If a person has ‘a career’ more than just a job, this has a major influence on their lives. Their behaviours are then likely to be conditioned by the industry in which they operate, as they have to ‘commit’ to long-term success. For example, doctors, lawyers, and estate agents may all meet as friends at university but become very different afterwards due to the demands of their careers.
As a whole, and unlike students, career focused individuals tend to plan and work for the future. They like to save, enjoy stability, pursue homeownership and have larger disposable incomes than the majority of the population.
However, in today’s society a career is rarely for life, which means a person can have multiple careers throughout their lives. A professional athlete may then become a physio, a mortgage provider may then become a property developer and an entrepreneur may become an investor.
Self-employed
The self-employed are a unique group with notable characteristics. They are typically more astute with accounting and tax implications as they have to manage their finances. They are also more likely to understand work/life balance considerations because they have greater control over their work commitments. And most importantly, they are not salaried, which means they have a much greater connection to success as a way to make money than simply ‘turning up’.
However, as in the case of career-focused individuals, within this group are many work profiles such as entrepreneurs, freelancers, and part-time individuals as well as industries such as actors, musicians, electricians, plumbers, influencers, and writers. For this reason, beyond the broader behavioural characteristics that they all share, their career choice will likely determine further their behaviours more specifically.
As is the case with the other two life stages covered here, being self-employed is only loosely correlated with age. Many people also regularly shift between self-employment to full-time employment and back again. For example, an actor may move into payroll employment when waiting for their next big gig. Alternatively, after being made redundant, an individual may freelance before considering another full-time role.
Implications for marketers
Deciding on one characteristic as a way to determine a person’s behaviour is essentially pointless in practice, as marketers never need to do so. However, they do need to build a foundation from which to further understand a target audience. For this reason, life stage may well be the most significant aspect to begin with. This is because it has the largest impact on the four aspects of a person’s mindset, namely the spare time they have, their disposable income, their passions, and their worries.
We hope you enjoyed reading this blog as an alternate way to consider developing a target market, either as a way to test your methodology or to find a way to develop one to begin with.
If you require any further assistance, then don’t hesitate to get in touch.
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