A thriftier, intensified, credit-crunched version of cocooning is emerging as a strong consumer trend the world over.

Downsizing, cocooning – we have heard it all before: As the credit crunch and plummeting dividends are beginning to bite, visits to expensive restaurants and high-class foreign holidays are increasingly becoming unattainable for many people.

As a result, home-made is fast becoming the buzzword.

Key trends

Eating in;

• Hunkering down: the new homebody lifestyle;
• Transport slowing down;
• Wedding bells;
• A holiday more humble;
• Home entertainment.

Commercial opportunities

• Consumer electronics are predicted to remain one of the growth sectors, as consumers are hunkering down for a period of more domestic social activities for the sake of spending less;
• Lower price and discounter sectors in retail and catering will see sales rise, as consumers are looking to spend less from their tightening purses;
• DIY and handicraft is already experiencing a minor boom, with consumers resorting to getting things done themselves;
• Home services such as cut-price hairdressing and food catering for events and dinners will be sought to avoid expenditure.

Background

Cocooning is a concept American futurist Faith Popcorn coined in the 1990s, describing the tendency, often fuelled by security concerns, to live a home-centred lifestyle and to equip the home with gadgets and touches of indulgence to make it a more welcoming and inviting entertainment hub and haven.

Popcorn identified cocooning as an important commercial trend that would lead to, in particular, a boom in electronic shopping from home which has since materialised. The current economic crisis is now predicted by many to mark a return to cocooning on a more frugal level than when it was conceived of in the more secure 1990s.

Eating in

After covering eating trends that have included haute pub food, exotic fruits like yuzu, and restaurants that dehydrated, foamed and froze everything from meat to dessert, upscale food magazines are writing about an even more unexpected topic: cheap home eating, reports Stephanie Clifford in a recent issue of the NY Times. Reflecting the bad economy, Gourmet magazine, usually a treasure trove of expensive restaurants and exotic travel, featured a ham sandwich on its March cover.

Articles entitled "The munch crunch" and "Nosh for less dosh" are featured in British newspaper, the Independent which reports predictions that "downloading two-for-one discount vouchers might even be overtaking porn as the No 1 activity of web surfers. Just think. "Euromonitor reports that Yoshinoya Holdings Co., Japan's largest operator of beef-bowl restaurants, plans to add a record 100 outlets in its home market during the coming year as demand for budget meals from recession-hit consumers increases. Meanwhile, restaurants classified as "fine dining" by the Japan Foodservice Association have posted eight months of declining same-store sales.

As necessity is the mother of invention, a national campaign by Johns Hopkins Bloomberg School of Public Health — Meatless Monday — maintains that eating like a vegetarian just one day a week reduces consumption of saturated fat by 15%, enough to ward off "lifestyle diseases" such as heart attack, stroke and cancer. As a side effect, it also lightens the burden on the family budget.

Hunkering down: the new homebody lifestyle

The zeitgeist says anything for a freebie as belts are tightening and consumers are making their homes into their entertainment hubs.

In the USA, ABC News reported how across the generations and income brackets, Americans are admitting to nesting; increasingly reading, cooking, watching TV and playing board games.

The London borough of Westminster has reported a sharp increase in its library visitor numbers as the recession bites. Director of libraries David Ruse said visits were up 10.5% (a total of 634,600) over the three months to the end of January 2009, compared to the same period the previous year. During the same three-month period, the number of new members (7,613) was up 18.3% on the previous year.

That some of the increase in the popularity of Westminster libraries is due to the recession is indicated by higher demand in certain non-fiction categories, with personal finance borrowing up 11.8%, business and management up 6.3% and basic skills books up 35.4%. The Birmingham Mail has reported that library use is also up locally as a result of the recession, with numbers of library members swelling by 4,500 to a total of 175,000.

Even weddings are coming home: the UK's Observer newspaper notes that "the rising costs of traditional ceremonies are leading many to consider having their weddings in the home they grew up in". Colette Harris, editor of "You and Your Wedding" magazine says that "having the reception at home is something more people are thinking about".

Transport slowing down

The European edition of the NY Times reports that, as sales of SUVs in the USA are down 40% in 2008 over 2007, the expression "that's so last August" has apparently surfaced in Manhattanite conversations as estate agents and bankers are adapting to crisis – even if they can afford it, they eschew ostentation. Conspicuous consumption is out – the Maserati models remain in the garage until further notice.

A more puritanical, value-driven lifestyle is now coming to the fore. As Germany and France are trying to aid the car industry by offering a premium on every old car that is exchanged for a new one, it is only small cars that are selling like hot cakes. The www.letsjapan.org blog reports that the Japan Times ran articles detailing how people were coping with the incipient economic meltdown. One article was about a surge in the sales of bicycles while another noted how more and more people were turning to car-sharing as an alternative to owning a car.

"Usually, bicycles sell well in the high season of summer and business is slow when it gets colder, but this year we have remained very busy," said Daisuke Nishikoori, manager of the Y's Road bicycle chain's outlet in Tokyo's Ikebukuro district.

Wedding bells

Reports from the Bloomberg website as well as the http://www.letsjapan.org/blog show that women the Japanese call "marriage-hunters" are increasingly looking for partners as companies from Toyota Motor Corp. to Sony Corp. fire thousands of workers and the nation heads for its biggest annual economic contraction since 1945. Marriages surged to a five-year high in 2008 as wages stagnated and unemployment rose for the first time in six years. Recessions have encouraged the Japanese to wed before: marriages rose when an asset-price bubble burst in the late 1980s and again after the technology crash in 2001.

Japan's husband hunters are pursuing relationships the way they might search for jobs: They interview at agencies — dating agencies, in this case. They attend networking parties or let friends know they are ready for commitment. Wedding mania is also increasing in other countries as the recession spreads around the world. The number of civil weddings in London's Westminster Register Office, the city's most popular, rose 8.5% to 1,684 between April 2008 and February 2009 compared with a year earlier.

A holiday more humble

German travel agents report a 14% downturn in bookings for January and February 2009 compared to 2008, with flight bookings down 19.8% and tourism down 8.5%. There has been a noticeable drop in bookings by families in particular since the beginning of the crisis in autumn 2008. In the UK, caravans and seaside chalets are experiencing an unprecedented boom thanks to consumers who prefer to (or have to) holiday in cheap second homes rather than villas with swimming pools and hotels.

While Flight Centre's Haydn Long insists that the crunch had not stopped Australians from travelling but has changed the way they spend while away, a survey of Australian tourism operators found that two-thirds believed the global financial meltdown had left the industry worse off. They predict it will deteriorate further as 2009 progresses.

Early credit crunch travel figures for Canada can be seen as representative for developed countries:

Quarter-on-quarter growth in tourism demand in Canada
C$ 2002 prices
 
Source: Euromonitor International from national statistics

Home entertainment

In a recent article, British newspaper, the Telegraph, finds that cocooning is back with a vengeance.

DVD rentals for the Franchise Entertainment Group are up more than 10% in 2009. The Australian newspaper reports that despite the global financial crisis, sales of flat screen TVs in Australia increased by 10.8% in the December quarter, indicating that families are spending to create a better home-entertainment environment so they can stay in. Sales of plasma and LCD screens have been rising over the past few years, as have the surround systems that went with them to create cinema-like conditions.

This time around, it is the economy which has created the cocooning rush. A recent survey by online DVD rental company Quickflix of more than 1,000 Australians showed more than 60% of respondents are staying home and watching up to five movies a month and two out of three homes have a plasma or LCD TV.

South East Asia seems to be the hub of the stay-at-home trend, with the Philippines topping the list with one of the lowest annual cinema attendances in the region: in 2008, only one trip per person annually, equal to South Korea but behind China (1.2), India (1.1) and Indonesia (1.3), providing opportunities for in-home entertainment. Marketers and researchers worldwide have also been speculating that the internet will be one of the biggest beneficiaries of the current economic crisis, as Faith Popcorn observes that über-cocooning will be the immediate response to hard times.

Outlook

For the time being, it looks like austerity – and a consequence, cocooning, is here to stay. However the home as an entertainment hub is an inviting prospect for many consumers and embraces pluses like the spread of high-definition movies, cheaper, home-made food and quality family time.

As US local newspaper website, News And Tribune.com puts it: "Cocooning has become an integral part of the new identity" of frugal consumers.

www.euromonitor.com