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The Great Divide: How the pandemic has impacted different income groups

What is the portrait of the Filipino into the renewed reality? Acumen’s insight indicates there isn’t a singular one—the different SECs of Filipino society present a range of realities as Filipinos step out of quarantine on different footing.

The challenges presented by the COVID-19 pandemic to Filipino life is no longer a mystery to many. Filipinos, who have tuned into the news throughout the quarantine period, are well aware of the hardships that our society has faced from massive job losses to an uncertain road to recovery. However, it’s important that while we may all have a common understanding of what has happened, the COVID-19 outbreak has not affected Filipinos equally and the actual impact of COVID-19 has differed in severity across Filipino income groups.

Middle to Upper Income: Cautious spending and Deliberate Living

For the middle to upper income group, their reality today is about maintaining their quality of life. So to them survival means being able to address a wider set of stressors, it’s not just about financial concerns but also growth, personal wellness, social wellness and adventure.

When we think about their lifestyle, it can be described as more deliberate living and cautious spending. They have an additional filter today when it comes to spending that has to do with the idea of what is essential and while finances are not as tight, they are cautious about what they are buying.

Lower Income: Simplified Living & Focused on Survival

On the other hand, the lower income groups have been more profoundly affected. The reality of many within this economic group is that they are focused on survival and their needs have gone back to basics.

In contrast to the previous group and even their lives pre-pandemic, it is about simplified living and stretching their resources. Pay cuts or job losses plus additional expenses on COVID requirements have strained their budgets and caused a decline in spend leading to downgrading or even omission of certain categories from their basket.

Deliberate approaches for each income group

This translates to different goals and approaches for businesses as they transition to the renewed reality:

For upper and middle income groups:

  • Focus on solutions and communication that help them maintain their quality of life, keep them safe and keep them sane

  • Ensure the value proposition and role in their life is clear to justify spend. Reward and giving back are relevant purchase drivers

For lower income groups:

  • For brands and businesses targeting this income group, what we need to bear in mind is that value and specifically cash outlay need to be carefully considered.

  • Beefing up the portfolio with lost cost alternatives will allow you to tide this period of constrain.

  • In terms of availability, close proximity channels will still be relevant as access to digital channels is still limited and Providing digital access will be an opportunity for those looking to increase penetration and reach.

  • Finally communications focused on Simple joys, resilience, family, hope and faith will resonate among this group as their solutions to their mental and emotional stress. It's important to note that this group is concerned about the other aspects of their life but their financial standing does not afford them the luxury to support or worry about these things. So the extent that your brand can provide both functional relevant and emotional support is something that value brands will need to think about.

Businesses looking to rebuild their relationship with consumers will have to be cognizant of these different realities for Filipinos. They will need to closely align their path to recovery with their target market’s journey to stability, working hard to reframe products and solutions to drive value and justify their role in the consumer basket.


About the Author Anny Oliveros

Anny Oliveros heads Acumen's Knowledge and Intellectual Property Development Center and has had over 15 years of experience in Business, Strategic Planning, Marketing, Sales and Capability Building both locally and in South East Asia building global and local brands. She is a certified Agile practitioner and has been working with Acumen to builds in knowledge and insights base for the last 5 years.



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