How Should Companies Handle Underconsumption?

---

by David Hagenbuch - professor of marketing at Messiah University -
​author of Honorable Influence - founder of Mindful Marketing 

---

I was fascinated to see video recently of a remote Amazonian tribe, deep in the rain forest of Peru, that’s one of the world’s last uncontacted people groups. Interestingly, while its members live successfully with very little, influencers in other parts of the world are suggesting minimalist lifestyles, being called underconsumption. Any trend of people buying less is troubling for many consumer-dependent companies, but it’s a great opportunity for firms to consider how they might diversify their goods portfolios and better meet consumers’ intangible needs.
 
The underconsumption movement apparently grew from a few people put off by the proliferation of self-proclaimed spokespeople using social media to promote an endless array of “must-have” products to their thousands or millions of followers. What’s more, the influencers receive many of the products they promote for free from the companies that market them, which makes their testimonials less trustworthy.
 
In contrast to those typical influencers whose bathrooms are bursting with new cosmetics and closets are cluttered with the latest workout gear, individuals advocating underconsumption show how little they own and how they find ways of doing more with less.
 
For instance, one TikTok user describes how for years she’s used the same tub of Vaseline for cracked hands, scrapes, and itchy skin. Vaseline smartly leaned into the content of this self-proclaimed brand advocate and included her clip on its TikTok site.

One can image how other brands with multifunctional products might take a similar tack. That’s what Arm & Hammer is doing on its TikTok site, which features videos of its iconic baking soda used for everything from cleaning dog toys, to washing pesticides from food, to relieving insect bites.
 
Of course, most brands don’t have the Swiss-army-knife utility of baking soda – there aren’t nearly as many varied uses for a Stanley Tumbler or Lululemon Leggings. Also, even brands like Vaseline and Arm & Hammer have product line extensions they also want to sell, e.g., Vaseline Hand Cream and Arm & Hammer Toothpaste.
 

Companies obviously need product sales in order to bring in revenue and earn income. Furthermore, that profit isn’t just self-enrichment. The money firms make allows them to pay taxes, provide employment, and pay dividends to shareholders, some of whom depend on the passive income during retirement.
 
So, how should companies that want to market mindfully respond to the underconsumption trend? Anytime there’s a challenge or problem, a good starting point is to ask why, in this case:
 
Why does underconsumption resonate with people?
 
There likely are several motivations for underconsumption, which may differ from person to person:

• Money: Gen Zs, especially, may not have the discretionary income to spend on many non-necessities. Part of the problem is debt, which continues to rise nationwide: In the second quarter of 2024, U.S. credit card balances rose by $27 billion to $1.14 trillion. Some families are even going into debt to take Disney vacations.

• Simplicity: Even for people who can afford more, the idea of decluttering and simplifying their life can be very appealing. It can provide peace of mind. Also, just like more money, more problems, one can argue that the more you own, the more things can go wrong, i.e., more possessions, more problems.
• Stewardship: Some people feel that consuming less is something they can to do protect the environment and support sustainability. Fewer goods produced helps conserve natural resources, reduce carbon emissions, and lessen trash going to landfills.
• Self-esteem: Staying out of debt, living a simpler life, and being a good steward also can make people feel good about themselves. Of course, individuals’ esteem also receives a boost when social media friends and followers like and share their unique posts.

 
Given the many compelling reasons for buying less, what should companies, which depend on people buying more, do? Here are four suggestions:

1. Understand how the motivations above apply to their own consumers. Some firms’ customers may be much more interested in saving the environment than in simplifying their lives. For others, it may be all about money. There’s little reason for an organization to discuss needs that don’t matter to its own customers.
2. Make multifunctional products: Stanley probably doesn’t want to promote that its tumbler also can be used as a flowerpot, but it has given the item some versatility by developing different interchangeable lids that allow the same bottle to be used in different ways, e.g., at work, in a car, while hiking, etc.
3. Give options for product disposal: People who are concerned about stewardship are probably more likely to buy products that they know they can trade in, resell, recycle, or upcycle into something else.
4. Understand what else people are doing with their money: For consumers whose motivation for buying less is not lack of funds but simplicity, stewardship, or self-esteem, there’s probably money they’re not spending on products that they’re using in other ways, like the four below. Granted, the examples may be more feasible for some firms than for others, but all are worth considering.
   1. Paying off debt: Partner with a financial institution that provides debt consolidation services.
   2. Saving: Work with a bank or other institution that offers savings instruments.
   3. Spending on experiences: Develop marketable services, ideally ones related to the company’s goods, or partner (e.g., cobrand) with an organization that offers them. For instance, there are many kinds of goods makers, e.g., luggage, clothing, shoes, technology, that could consider opportunities related to travel.
   4. Giving: Help customers find good causes to which they can donate. This approach is unlikely to be a direct revenue producer for the firm, but it is a worthwhile strategy that can count as corporate social responsibility, earning the firm goodwill and eventually new customers.

 
No matter what our worldview, we all should agree on several truths related to goods, that:

• You can’t take them with you.
• People are more important than things.
• Life does not consist in an abundance of possessions (Luke 12:15, NIV).

​Those living successfully in the Amazon rainforest with very little should remind us that it’s possible to survive without continually purchasing products from the other Amazon. Still, most companies that produce goods do help make our 21st century lives healthier, more productive, and more stimulating. These firms need to make money for our benefit and for theirs.
 
The four diversification strategies described above are general but might spark thoughts of how companies can complement their tangible product offerings with intangibles. Considering more carefully what one buys is mindful consumption. Understanding those consumer desires and building strategies to support them is Mindful Marketing.

Subscribe to Mindful Matters blog.
Learn more about the Mindful Matrix.
Check out Mindful Marketing Ads and Vote your Mind!