Implications of Frugality as the New Black

I have heard some dialogue about consumers freeing up their spending even without their salaries going up or their house value going up (although their portfolio may have recovered by now).  But, the question is how the frugality that was learned in the past year will impact consumers long-term.  Will it change the way they buy?  Will that be true across generations or will this just have a major impact on certain generations that are just coming of age?

An article released by Booz & Company a few weeks ago has some interesting data in it.  For example, in the chart below, it shows 22% of people spending less on healthcare (drugs, supplies).  What does that imply – pill splitting, more generics, more mail order, lower adherence, less preventative care?  So are they more receptive to cost messages from healthcare entities?

Most of the consumers surveyed said they continue to consider saving more important than spending (65 percent). They sacrifice convenience for price (65 percent), frequently use coupons (65 percent), and, to a lesser extent, prefer the best price to the best brand (55 percent).

Maybe it’s time for the PBMs to emphasize convenience more – simplify your life, use mail order…one less errand to run.  I’m still skeptical that this would beat a traditional cost savings message.  BUT, perhaps it’ time to reconsider coupons / incentives.  They’ve been tried with limited upside over the years in pharmacy.  They do drive up results, but they don’t always pay for themselves.  Maybe a lower value incentive would have the same yield thereby increasing ROI. ???

They identify six segments of the population with this frugality filter:

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