Liquid Consumption - why the consumer increasingly prefers access to goods and services over ownership
The 'sharing economy' indicates the increasing importance to consumers of flexible access to goods and services. This paper presents the concept of liquid consumption to explain this shift away from ownership, and suggests how firms can capitalise on it.
Consumer behaviour has evolved. The growth of the 'sharing economy' tells us that access to goods and services, as opposed to ownership, is of ever greater importance to consumers. Where much of existing consumer behaviour research has focused on ownership, this paper introduces the concept of liquid consumption to explain what drives access based consumption.
The paper draws inspiration from eminent sociologist Zygmunt Bauman's work on liquid modernity, in which he uses the metaphor of liquidity to explain how everyday life has moved from a state of stability to one of rapid change. Life is now organised around consumption, is subject to rapid technological advances, and has witnessed the expansion of the market to a global scale. With all aspects of life now subject to market logic, and social structures becoming more liquid and providing less stability and certainty, liquid consumption facilitates an appropriate lifestyle that is flexible, quick, and light.
Liquid consumption has three primary characteristics:
- Ephemerality - liquid consumption offers value to consumers in particular contexts, and the expiry date of this value is increasingly shortening. In contrast, solid consumption is more enduring.
- Access - access is valued in comparison to ownership and possession, whether for material or immaterial consumption. In contrast, solid consumption is ownership-based.
- Dematerialisation - this is a preference for digital products over physical, for lighter and smaller products, and a preference for experiences over material forms of consumption.
Using liquid consumption to conceptualise increasingly common forms of consumption, such as we see in the sharing economy, is important because it has implications for a wide range of practices.
For example, in liquid consumption a strong connection to one's identity is no longer necessarily a motivator for purchase. We see a preference for access to a wide variety of brands, through car sharing membership rather than car ownership as an expression of identity for example.
Marketers need to identify whether their consumers engage in liquid or solid consumption and design their plans accordingly. Liquid consumption values fast resource circulation rather than acquisition and appropriation. Therefore, marketers need to design infrastructure and distribution systems for the quick acquisition of products. As liquid consumers have a flexible attachment to possessions, they see value in convenient market places (either digital or physical) where they can redistribute or recycle these resources. Marketers also need to provide equally convenient and viable alternative acquisition options, such as long or short-term renting, peer-to-peer, or borrowing options.
Liquid consumption has implications for branding. It implies that consumers will want to access a variety of brands for different situations, rather than exhibiting loyalty to a few brands which demonstrate their personas to others.
Liquid consumption also has implications for understanding how big data and quantification are becoming part of our daily lives.
Additionally, there are implications for luxury marketing. Will experiences take over from prestige products such as luxury watches or handbags to become the ultimate symbol of distinction?
Finally, the paper considers potential negative consequences of liquid consumption, particularly with regards to consumer welfare. It remains unclear how consumers that have spurned ownership and possessions in favour of liquidity will establish security in their advanced years. Further research into how liquidity can be managed to avoid storing up problems in the long run is encouraged.
Professor Fleura Bardhi delivered a presentation on Liquid Consumption at the Digital Consumption Symposium at Cass Business School in late 2016.
A draft version of the research paper is available for download at the link below.