Last Tuesday, I had the pleasure of attending marketing guru Ned Roberto’s premiere presentation of his First Nationwide Consumer Coping Behavior Study to representatives of the 24 companies that sponsored the study, and other clients and guests.

Dr. Ned (co-author with his son Ardy of the column “Marketing Rx” in the Philippine Daily Inquirer business section on Fridays) is a trailblazer in marketing research. He is THE national authority on the socioeconomic classification (SEC) of Filipino households into A, B, C, D and E—a simple and practical system, widely used by the private sector, but not by the government, unfortunately.

The concept of “kapos.” One of Dr. Ned’s innovations is an indicator for economic stress, based on his question: “Gaano po kadalas sa isang buwan dumarating sa inyo ang mga kinakapos na pagkakataon? Pag-usapan po natin itong nakaraang apat na linggo.” [“How often in a month do hard-up times come? Let’s talk about the past four weeks.”] The housewife (Dr. Ned’s favorite survey respondent) may choose from these answers: Never; Once; Twice; Three to five times; Six times up to every other day; and Every day. This allows five degrees of “kapos”—using the operative Filipino word rather than the non-literal English translation “hard-up”—of which the most severe is being “kapos” every day in the past four weeks.

Dr. Ned has surveyed “kapos” in Metro Manila—the National Capital Region (NCR)—11 times between 1984 and 2008, the last being part of his new nationwide study of consumer coping behavior. For NCR housewives from the DE class in particular, feeling “kapos” every day peaked at 24 percent in 1985. It was fairly high at 15 percent in 1987 and 17 percent in 1998, subsided to about 1 percent in 2001 and 4 percent in 2006, and ballooned to 21 percent in September 2008.

For the entire sample in 2008, covering all socio-economic classes, those feeling “kapos” every day are 18 percent in NCR, 18 percent in the Balance of Luzon, 17 percent in the Visayas, and 15 percent in Mindanao. In these hard times, how do consumers adjust their spending patterns? Dr. Ned’s study provides data at the product level, as guidance for business.

Consumer segments. The study describes current spending trends of households on 200 non-durable goods and services, and 51 durable commodities. For each item, his questionnaire design enables the segregation of consumers into Maintainers, Lapsers, and Non-users.

The Maintainers are those purchasing the item in the current month, who also purchased at least the same amount of it some time before. Some of them are a core who keep up customary purchases. Some are big spenders who have increased their purchases. Some are returnees who used to buy it some time ago, then stopped, and then restored it to their budget now.

The Lapsers can also be called the Deserters. Some of them are a core who dropped the item either this month or some time ago. Some are economizers purchasing less of the item now. Some are switchers who are adopting it now as a substitute for something else they used to buy.

The Non-users are those who have never purchased the item. Marketers should try to get them to become trial users, at least.

Product categories. Dr. Ned uses a product’s proportions of maintainers and lapsers to fit it into one of five categories. If its users are at least 81 percent maintainers and at most 10 percent lapsers, then he calls it a Staple. Staples are absolutely necessary, and bought by habit; one can’t do without them. In hard times they are unlikely to be adversely affected.

Categorization varies with area and class—different areas or classes would have different staples. In the NCR for instance, Dr. Ned regards as staples only nine of the 200 nondurable items that he studied. Bath soap is the top staple in general, but toothpaste is the top staple for Class E.

If a product has 61-80 percent maintainers and 11-20 percent lapsers, Dr. Ned calls it a Near-Staple. Its maintainers are a multiple of its lapsers. It is not absolutely necessary. In hard times it may be somewhat negatively affected. Dr. Ned lists 17 near-staples for NCR. Midway on this list is dried fish (“tuyo”).

If a product has 41-60 percent maintainers and 21-30 percent lapsers, Dr. Ned calls it a Want/Nice product. Its maintainers are roughly double its lapsers. It’s something nice to have, but not necessary; it’s still more a want than a need. In hard times it will be seriously affected negatively. Dr. Ned lists 26 want/nice items for NCR, for example, powdered fruit juice.

If a product has only 21-40 percent maintainers, but has 31-40 percent lapsers, then Dr. Ned calls it Near-Dispensable. It’s more dispensable than indispensable; it’s no longer a want, and it’s far from a need. In hard times it will be very seriously affected negatively. Dr. Ned lists 51 such items for NCR, e.g., canned meat loaf.

A product with at most 20 percent maintainers and at least 41 percent lapsers is Definitely Dispensable. Its lapsers are a multiple of its maintainers; one can live without it. In hard times it will be most seriously affected negatively. Dr. Ned lists 97 such items for NCR, e.g., original DVD films.

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Fieldwork and data processing for the consumer coping study were contracted to Social Weather Stations (SWS) by the Foundation for Asian Consumer Insighting and Market Understanding (FACIMU), the advocacy marketing research arm of Mansmith and Fielders Inc. (www.mansmith.net), to which inquiries may be directed. Dr. Ned is chairman of FACIMU and vice chairman of Mansmith. He has been an SWS Fellow since 1991.

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Contact SWS: www.sws.org.ph or mahar.mangahas@sws.org.ph.