State of Fear: Adapting Marketing Strategies to the Stressed Consumer

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The following article appeared in the Journal of Brand Strategy (VOL. 12, NO. 1, 49-58 SUMMER 2023, Henry Stewart Publications)

JAKE MCKENZIE

CEO, Intermark Group, USA

Jake McKenzie is the CEO of Intermark Group, a psychology-driven marketing agency in the USA that works closely with psychologists and other behavioural sciences to drive dramatic change for their clients. Jake’s background is in psychology, which gives him an unparalleled view of changing customer beliefs and behaviour.

JAMES D. MCFARLAND

People Scientist, Intermark Group, USA

James D. McFarland is a graduate from the University of Montana with a PhD in the field of experimental/social psychology. His research focuses on the origin, maintenance and adaptation of competing cultures and ideologies along with their associated behaviours.

For nearly three years now, consumers around the world have been struggling to acclimate their lives to the ‘new normal’ (whatever that may mean) set in motion by the announcement of a newly discovered strain of coronavirus in late 2019. The early and extensive media coverage of the COVID-19 virus (SARS-CoV-2), combined with the results of the hurried attempts to model its potential threat, created a groundswell of fear and uncertainty among both public and private individuals across much of the world. This fear, along with the implementation of unprecedented public policies designed

to mitigate the projected threat, exponentially increased the complexity, hard- ship and anxiety of conducting simple everyday tasks for individuals and societies as a whole. Needless to say, the odd combination of events that have come to define the year 2020 (eg masking, social distancing, isolation) have undoubtably played an important role in the formation of the near historic levels of chronic stress and worries regularly being reported by the general population.Indeed, some studies show that even when the acute levels of depression and anxiety recede, the functional impairment of one’s daily living tasks often still remains an issue.6 For example, recent studies looking at the effects of social distancing and isolation on the mental health of children and adolescents have found that the increased stress resulting from loneliness and social isolation has negatively impacted the life- styles, behaviours, attitudes and mental health of the participants. According to some researchers, these negative impacts are anticipated to have long-term mental health repercussions within large swathes of the general population, including elevated levels of fear, irritability, unhappiness, depression, anxiety and higher rates of post-traumatic stress disorders (PTSD).

While it is unknown how long these specific effects will remain in the cur- rent population, research based on the long-term effects of other communicable outbreaks (eg SARS-CoV-1) suggests that the containment strategies used in response to the COVID-19 virus likely results in similar health outcomes that were observed in the individuals and groups who were personally affected by previous health crises. (In these cases, long-term health outcomes included elevated levels of alcohol use, PTSD, fear, distrust, uncertainty, anxiety and perceived risk.)

Of course, the massive global response to the COVID-19 virus is relatively unprecedented, and it is difficult, if not impossible, to accurately predict the magnitude and duration of its specific effects on the world’s population further into the future.

STRESS AND ANXIETY WITHIN THE CURRENT POPULATION

In general, stress levels among consumers in the last two to three years appear to be higher than normal and have yet to recede. In March of 2021, a survey by the American Psychological Association (APA) showed that consumers were experiencing more stress and in higher numbers than ever before In this survey, almost half (48 per cent) of the people polled reported that they had elevated stress levels owing to the pandemic and its associated hardships, and more than half (67 per cent) reported that they had sleeping issues since the pandemic started. In another poll from the APA conducted in 2021, researchers found that the effects of prolonged stress were playing a significant role in the daily lives of many consumers, with 67 per cent of Americans reporting that they felt overwhelmed by all the issues the country was facing. Similar findings about the effects of prolonged stress come from a longitudinal study by Gallagher et al. published in 2022. In this study, researchers found that the environment shaped by the presence of the COVID-19 virus not only contributed to higher levels of acute stress, anxiety and depression among the participants in the short term (decreasing towards the end of the study) but also appeared to contribute to the long-term functional impairment of those individuals in their daily activities. This functional impairment among participants occurred across five different domains (family/relationships, work, home management and both private and social leisure activities) and remained stable throughout the longitudinal study.

While the events of 2020–2021 were bad enough in terms of inducing stress and uncertainty, little did we know that it could get worse. In March 2022, the APA released another survey showing that we are experiencing even more stress now than in any of the previous but that this time that stress also included some entirely new reasons. Fears and concerns about rising inflation topped the APA’s list, as 87 per cent of respondents said it was a significant source of stress in their lives (the highest level of stress associated with any issue since the APA began taking the annual survey in 2007). Supply chain issues (81 per cent) and the unrest surrounding the current state of affairs with Russia (80 per cent) were also reported as significant potential worries and significant sources of stress among participants. It would appear that the recent cascade of negative events are being added onto an already overstressed population. A recent study by Low and Mounts helps illustrate the disturbing degree that the current financial and economic worries have been compounded by the functional impairment created by the ‘new normal’ of today’s world. In their study the inter- action of those two factors was found to significantly increase the daily levels of psychological distress, conflict and loneliness found among the individual members of consumers’ households.

Considering the cumulative events of the last two years, it could be suggested that if there is a tipping point for the amount of prolonged stress one can successfully endure, we are collectively being pushed closer and closer to it with each passing day.

EXTENDED PERIODS OF FEAR AND UNCERTAINTY CHANGE HOW WE PROCESS INFORMATION

When experiencing intense amounts of stress, we tend to process and respond to incoming information as if we are under threat, as of course, you must be aware, given that you are living through all of this as well. What may not be obvious is that prolonged periods of intense stress can change how we consume information and make decisions.

Past research on the nature of stress suggests that the human body accommodates the presence of acute and chronic stress in very different ways. While acute stress is generally adaptive to singular moments in time (with largely transitory costs and effects), prolonged stress and worry tend to trigger fundamental long-lasting neurological changes, ultimately altering our abilities and behaviours for years to come. For example, research shows that chronic worry and rumination are associated with significant increases in future health risk behaviours (eg substance abuse, overeating and smoking). Typically, when placed under stress, elevated levels of cortisol (or ‘the stress hormone’) circulate throughout the nervous system, preparing the organism to swiftly take corrective action to something aversive. This can be advantageous, of course, in instances where a heightened physical reaction or an intense memory can help stave off the immediate danger or prevent a future threat from occurring. But when the elevated stressor is chronically present, certain areas of the brain begin to rewire themselves in response to the perceived presence of a constant long-term threat.

Continued exposure to stress (even at lower cortisol levels) increases the size and connectivity of the brain regions associated with negative emotions (eg the amygdala) and decreases the size and connectivity of the brain regions associated with learning, memory consolidation, goal-directed behaviour and cognitive flexibility (eg the prelimbic area of the prefrontal cortex and the anterior cingulate cortex). In other words, when subjected to elevated and prolonged stress, all our fears and anxieties become stronger, more salient and closer to the surface. We also have greater difficulty focusing our attention, integrating memories, making decisions and manipulating multiple items of information for immediate use (ie working memory). If all that was not enough, studies also suggest that this type of stress tends to reduce cognitive flexibility (ability to see multiple outcomes) and increases the tendency to engage in more habit-based responses rather than goal-based decisions. Taken all together, a very clear and unpleasant picture is beginning to come into focus. The presence of long-term stressors appears to have an effect on our ability to interact with the world around us.

Indeed, it can be asserted that the weeks, months and years of threatening news, debilitating fears, limited mobility and looming uncertainty may have resulted not only in a general population that is currently more fearful and anxious but also one that is possibly processing its information differently.

PROCESSING INFORMATION IN AN ENVIRONMENT OF PROLONGED STRESS

This deeper understanding of the neurobiological process has profound implications for marketing to a stressed consumer. In a more relaxed environment, where stressors have not been consistently present for an extended period, the human brain has greater access to advanced cognitive

processing abilities (eg via the prefrontal cortex and the anterior cingulate cortex structures). This collection of specialized cognitive processing abilities is often referred to in psychology as ‘System 2’ processing. When applied to problems within one’s environment, the use of System 2 processing often results in more efficient behaviour patterns and helps pro- vide answers based on the rationality and logic of the supplied variables. During times of minimal stress, the functionality of the structures that constitute System 2 remains relatively unobstructed and is more easily accessed for the deliberate methodological processing of information and exploration of multiple alternatives.

For example, the cognitive reflection test (CRT) provides one way to demonstrate how System 2 processing can allow one to arrive at the correct answer despite the presence of emotional and intuitive clues that might otherwise lead us astray. The following is a sample question from Frederick’s 2005 CRT that helps illustrate this cognitive process.

A bat and a ball cost $1.10 in total. The bat costs $1.00 more than the ball. How much does the ball cost? _____ cents.

The use of System 2 processing allows one to focus on the rational information found in the question, thus enabling you to ignore or discount the otherwise intuitive answer of ‘10 cents’. Similarly, System 2 processing plays an important role when encountering novel situations and/or exploring one’s curiosity. In fact, System 2 processing is often the mainspring of scientific breakthroughs and/or structured innovation (ie via the scientific method). Thus, System 2 processing allows us not only to approach problems analytically, thereby allowing us to formulate accurate and rational answers to those problems but also to accommodate novel situations and unexpected surprises in our environments in a constructive way.

Unfortunately, as noted earlier, periods of prolonged stress tend to reduce and strain those specialized cognitive resources, thereby compromising our ability to engage in System 2 processing and instead increasing the likelihood of using a more primal cognitive process instead, such as System 2’s faster counterpart, ‘System 1’. With System 1 processing, the intuitive and reactive areas of our brain are largely in control; that is to say, we operate more on the basis of instinct and prior experience rather than empirical logic and reason. Taking the example of the CRT question listed previously as an example, the intuitive response to it would generally be ‘10 cents’. Such an answer is quick, easy, on the surface and makes perfect sense. Based on our prior experience with mathematics, mixed in with some gut-level instinct, the answer of ten cents comes almost effortlessly to mind. The fact that it requires very little effort to engage in System 1 processing is indeed one of its most useful traits. Researchers suggest that autonomous processing may be the defining feature of System 1 processing. The ability to automatically process parts of the world around us has many benefits (it would be hard to get anything done otherwise), but, ultimately, this ability was intended for survival, especially by those who are under threat or feeling overwhelmed.

The dynamic exchange between System 1 and System 2 processing is beyond doubt a crucial factor that allowed our ancestors to overcome a much harsher world than the one we currently inhabit. But even in the absence of things like sabretooth tigers, exposure to inclement weather or impending starvation, those same neural circuits still inform many of our behaviours and decisions today in the modern world — a world that might be free from many of the physical threats that plagued our ancestors but one that is still more than capable of inflicting a great deal of stress and uncertainty.

APPEALING TO CONSUMERS IN A HYPER-STRESSED ENVIRONMENT

When our ‘survival mode’ is activated by elevated and/or prolonged stress, a different decision-making process begins to be established, and there is a shift from analytical thinking to more intuitive thinking. Research suggests that when subjected to chronic stress, we are more hesitant to choose a course of action and that when we do, our decisions are based on values and principles rather than utilitarian calculations. It does not help matters that this ‘survival mode’ type of thinking may often be compounded and reinforced by the uncertainty of what the next day’s news cycle or public policy might bring.

Recent polling data published by the APA (October 2022) finds that 27 per cent of adult respondents are so over- whelmed by stress that they are unable to function in their daily activities. Furthermore, a total of 34 per cent of respondents reported that stress causes them to feel completely overwhelmed on most days. Other polling questions found that 76 per cent of respondents reported that their stress levels have negatively affected their health in the last month and that, overall, inflation (83 per cent), money (66 per cent) and the economy (69 per cent) are the primary sources of respondents’ stress. What is interesting about this data is that the average stress level reported is unchanged from all of the polls taken since 2020 (all averaging 5 on a 1–10 scale; in the years prior to 2020 the average was slightly lower); however, this continued stress appears to be having a cumulative effect on daily functioning and overall health, particularly among younger adults. Taken all together, this may be a good time to re-examine those tried-and-true marketing techniques as today’s consumers are likely processing incoming information with a slightly different mindset than they were a few years ago. In what follows, you will find five easy-to-apply marketing strategies that may be relevant to today’s overwhelmed consumer.

REDUCE OR ELIMINATE THE SHOCK VALUE

The initial challenge of advertising is to get people to pay attention to the message. To overcome this, advertisers some- times use ‘shock’ advertising as a way to capture customer focus. From years past, you might remember some shocking ads, such as the one from Volkswagen’s ‘Safety Happens’ campaign that showed an unexpected car crash in order to high- light their advanced safety features. The value of this type of ‘shock’ invariably hinges on how much attention is garnered from the portrayed event. That is to say, was the event surprising or unusual enough to capture the sustained attention of the observer. Research shows that surprise (and its subsequent attention) is strongly associated with a desire to learn and explore the world around us. When in survivalist mode, however, the human brain becomes much less capable of satisfying its curiosity and much more interested in preventing additional or potential harm. While ‘shocking ads’ will still capture attention, since we are hardwired for them, in a hyper-stressed consumer, chances are that they will primarily generate large amounts of negative emotion, which could ultimately be damaging for the brand.

MANAGE CHOICE OVERLOAD

Despite what we think, consumers do not really react well to the availability of numerous options. Numerous studies show that consumers will buy more frequently when presented with fewer options even in normal times. Stressed consumers likely have fewer cognitive resources to dedicate to intense decision making affecting, in turn, how they approach their buying decisions. Thinking too hard or too long about things that dis- tract from ‘survival’ is not a natural path for the stressed mind to take. Take a cue from Apple (the most valuable company in the world) on how to manage this — for their new iPhone 13, Apple gives consumers two options to choose from — a base model or the ‘Pro’, with a better camera. Additionally, Apple’s website is incredibly easy to navigate and provides a natural path to buy without overloading the consumer with a barrage of distracting options or choices. All of this can help provide the survivalist brain with a clearly delineated path that feels safe to follow.

PROVIDE EMOTIONAL VALIDATION

Psychologists will tell you that when a friend is in a spot mentally, acknowledging what they are feeling is a great way to start helping them. Marketing can leverage this as well by acknowledging the difficulties we are all collectively going through. The emotional release of this helps not only capture the attention of the consumer but also create a strong emotional connection with the brand. One great example of this comes from the recent State of Alabama Tourism Department’s advertising campaign. Over the past two years this campaign validated consumers’ feelings of stress and emphasized how a vacation in Alabama provides the perfect opportunity to slow down and relax in an otherwise stress-filled world.

LEVERAGE FAMILIARITY AND NOSTALGIA

When we are stressed, we seek things that make us feel better. Things that are familiar, comfortable and nostalgic all help to achieve this feeling for consumers. Not only are these familiar items of information easier for the overstressed brain to process (via System 1), but the positive emotions elicited often provide a much-needed therapeutic experience, creating feelings of goodwill towards the source of that information. Examples of this filled several Super Bowl ads this year, such as Rocket Mortgage using famous and very familiar toys from child- hood (Barbie and Skeletor) to promote their company’s app. Tactics like these can be highly effective because the selective nature of the survivalist brain gives priority to old habits and familiar patterns. As an added bonus, the positive environment created by nostalgia not only provides consumers with an easier path in focusing their attention but also helps create a positive emotional connection that can ultimately drive brand preference. This brings us to our last thoughts before we conclude.

BUILD YOUR BRAND

In a world of prolonged and intense stress, consumers lack the mental resources, time and energy to analytically compare products or services. Instead, they leverage ‘default decision making’ and respond emotionally to incoming information. This can result in primarily using the products and services they are familiar with (default behaviour), but it may also lead them to unexpectedly shift to a competing product

or brand if they feel it better supports their immediate needs (default emotion). Thus, during periods of high stress, clearly differentiating your brand’s image allows consumers to easily identify and connect with your products and services on a more accessible emotional level. Admittedly, a strong brand is not built overnight. But as the proverb says, ‘The best time to plant a tree was twenty years ago. The second best time is now.’

CONCLUSION

Consumers have been reporting high levels of stress and anxiety, and while these feelings are certainly not permanent, it is also not clear when those levels will begin to dimmish. The relentless bombardment of panic-inducing headlines, immobilizing doubt and worry about the future has seemingly produced (for the time being) a ‘new normal’ of anxiety and uncertainty. Research suggests that a highly stressful environment may have an effect on how the average person processes incoming information and makes decisions. This means that previous marketing strategies may not be as effective as they were just a few short years ago and that now might be a good time to consider adapting your marketing strategies towards the mind of the stressed consumer.

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