Future Foundation: Localism and the power of collective consumer action

In our first trend update of 2011, the Future Foundation explores the move towards increasing consumer power – a powerful trend and one that is being redefined and rejuvenated as we look to the coming decade.

One need only look at the political parties’ manifestos – David Cameron’s vision of a Big Society, Labour’s commitment to create a sort of a community National Service, the Liberal Democrats’ fervent belief that society is strengthened by communities engaging in voluntary activities – to get a sense that community spirit is immensely and increasingly significant.

The path of community action never did run smooth

If the ambitions of the political parties are to be realised, there are two significant hurdles to overcome.  First is historically low levels of engagement with community activities – since the early 1990s, the proportion of Brits who are active in voluntary service organisations has never really strayed far beyond the 4% mark (see nVision chart below).  There is a long way to go before voluntary work even approaches a significant minority, let alone the levels hoped for by political leaders.

Second is the demographic mismatch of volunteers and the communities they serve.   In 1992, for every 100 people that were active in local voluntary groups, 35 were aged over 60.  By 2008, this had increased to 51.  In other words, only around one in 25 people are currently active in their local communities, and even among this group, the majority are aged over 60.  There is a clear imbalance here between the local population and the volunteers serving it – an imbalance that will need to be redressed before this trend can gain full momentum.

Interestingly, despite these impediments, there is a consistently strong consumer demand for local products and services – while only a fifth of UK consumers have attended local events like car boot sales or village fetes, 10% have volunteered for their community over the past year and even fewer have campaigned for local issues or volunteered for local business, yet we see that nearly half (49%) have bought locally produced products in the last year.

The point here is that we seem to be far keener on localism as consumers than we are as citizens – an interesting dichotomy and, we would argue, a major obstacle to overcome before consumer power can truly be unleashed.

Positive localism

When asked what they associate the word ‘local’ with, more than 60% of nVision survey respondents chose the literal definition of ‘nearby’.  However, other high-ranking responses give a strong sense of the overwhelming sense of positivity that ‘local’ infers – words such as ‘quality’, ‘trustworthy’, ‘authentic’ and ‘premium’ illuminate the deep emotional connection that we have with all things local.

We would also argue that in many ways, the recession has had a positive effect on localism, stimulating interest in both British and local products and services, and giving consumers a sense that they are doing something to help a beleaguered economy.  Our appetite for locally produced food, for example, has become prominent in recent years: according to nVision data, less than 50% claimed to have bought locally produced food in 2008; by 2010 this had increased to majority level.  There was also a dramatic increase in interest among younger consumers – local consumption among the under-25s increased from 28% to 42% over the course of two years.

Adjusting to consumer demand, supermarkets have boosted their local credentials – Waitrose now sells more than 1,200 local products from 450 local suppliers; and The Co-operative Food recently launched an iPhone app that allows shoppers to scan items on its shelves and instantly see the farms where they are grown.

The driving forces

Other than positivity, nVision gives an indication of some of the other drivers behind the localism trend.  Most potent – and the key reason we are optimistic of any effort to re-energise local communities – is the perception that society is no longer what it used to be.  We can see from our data that eight out of 10 Brits say there was a greater sense of community in the past than now.  Although this sentiment increases with age (almost 90% of the over 65s are of this opinion), it is also startlingly pronounced among young people – almost two thirds of people under the age of 25 agree.

This kind of nostalgia accordingly fuels community spirit – looking at our data, we see that 83% of Brits are concerned about the decline of local communities; 84% are worried about closures of local post offices;  81% of us are worried about their disappearance of the quintessentially British village shop; and 56% are concerned about the closures of local pubs.

Digital collectivism – the impact of technology

Though it may seem counter-intuitive, we expect the rise of digital technology to play a vital role in energising and revitalising the collectivism trend. Already one in three UK consumers use the internet to connect to people in their local area – and while this is more prevalent among young people, our data demonstrates that a quarter of people over the age of 65 also use the internet in this way.

And of course the interaction between technology and local is greatly assisted by the leap from desktop to mobile.  In our own research, we find that one in eight 25-34 year olds are now using location-based services such as Foursquare, Gowalla and, most recently Facebook Places, on their mobiles to find and share information and discounts for local products and services.  In fact, 44% of Brits say they would be interested in an app or device that detected their location and sent them promotions for nearby shops.  The power of local is seemingly limitless.

Further examples of the growing interaction between collective action and technology:

• Group buying: for consumers seeking greater control over purchasing, strength in numbers is an attractive strategy.  The phenomenon of collective discounting – a  group of people meeting at the same time to negotiate the price of an item in a shop – emerged in China.  Replicating this experience online, a wave of websites such as Crowdity and Groupon offer shoppers in specific locations one discount each day, which is redeemable only if a target number of people buy the deal before it expires

• Crowdsourcing – brands are taking advantage of new online communities by asking their customers to get involved with  designing and developing new offers.  This is not a new idea – brands from Lego to Kraft to Ford have long been inviting consumers to help in the development of ideas that meet their business needs.  What is new, however, is the scale of the ambition – brands are beginning to invite consumers into much more strategic conversations – in essence, hardwiring consumer communities into the central nervous system of their innovation processes

The localism trend is one that is set for a strong upwards trajectory over coming years – and for brands, this may well promise a truly energised future.