[Jeon Youngsoo's Population Prism] 'Deokdo Consumption' Youth Generation Opens Wallets for 'Hwiso Value'

The Generation That Relieved Depression Through Reality-Check Spending
When They Move to the Stage of Enlightened Spending Saying "It’s Meaningless Even If I Try,"
They Close Their Wallets Beyond Frugality

The subsequent generation is effectively the first generation deprived even of dreams. They envy pets who get all the affection without doing anything. It is a loss of hope. Even if they listen well to their parents, whether they will be happy is uncertain. There is also an analysis that they are the founding generation destined to be poorer than their parents. The fortunate thing is that, compared to previous generations, they did not experience absolute poverty while growing up. However, poverty and defeat are keenly felt on the employment front. The myth that diligence guarantees survival has collapsed. These new humans are pouring in as full-fledged producers and consumers. It is a moment when the population will change the market.

The subsequent generation is the future protagonist. When the members change, the stage changes. This also predicts a long and severe transformation. The production and consumption scenes are expected to change distinctly due to the shift in the core population. A new setup is forming. The overall situation can be summarized as a decrease in customers. The working-age population (15-64 years old, 37.57 million) declined for the first time in 2017. The 2019 special future population projection forecasts a disappearance of 20 million people in 50 years (17.84 million in 2067). The decline is steep. The outflow of the massive baby boomer group cannot be compensated by the subsequent low birthrate population. From 2020, 700,000 to 800,000 people decrease annually, while only 400,000 to 500,000 are added. Considering the entry of those born in 1975 into age 65, the working-age population will decrease by an average of 500,000 per year over the next 20 years. Since production and consumption that make up the market inevitably shrink, in short, it is a shrinking economy.

Quantitative decline alone does not produce a shrinking economy. Qualitative changes reflecting altered values and life perspectives also shake the existing order of consumption and markets. The subsequent population’s consumption orientation differs from that of their parents’ generation. The changed lifestyle of the changed customers means changed desires and changed consumption. Immediate resistance to consumption is strong. They have little or no money or dreams, so forced spending is inevitable. Of course, they do spend, but the standards differ. This is the key point of future market subsequent customers. It is a unique consumption trend optimized for the era’s changes. Gong (gong) has sounded. Even looking at generations born after the 1990s confirms this. The previously solid specific consumption by life cycle is ignored. Since they refuse the baton of generational roles, preferred consumption by specific age groups also decreases.

The changed young generation will breathe with the market for at least 60 to 70 years after graduation. Born below the population replacement level (fertility rate 1.3), they are the low birthrate generation aiming for a different life path. They overturn the market as producers and consumers. Adversities and opportunities coexist. Growth expectations are as strong as the pressure of decline. The prominent consumption trend is reality-compromise type. Passive reality-check spending is such. Next is 'enlightened (deukdo) spending.' When reality-check spending repeats, it leads to enlightened spending that resists consumption satisfaction in the long term. It is a mechanism to withdraw from the market altogether because spending is meaningless or minimal even if tried. It is a consumption style at the enlightened stage that realizes early on that consumption utility holds little value.

If reality compromise is reality-check spending, enlightened spending is close to reality escape. They cannot live like their parents, and achievement is difficult, so feelings of self-deprecation and deprivation are embodied in the consumption scene. The best strategy is self-help. The vicious cycle of 'employment failure → increased despair → loss of motivation' naturally deepens the enlightenment of life futility. Even if employed, the collapse of traditional livelihood benefits such as lifetime employment and seniority drastically lowers the desire for promotion and success. They endure tactfully but quit easily when cost-effectiveness (performance relative to price) drops. At first, they relieve depression with reality-check spending, but once enlightened, the story changes. Beyond frugality, they close their wallets. Only impulsive starting costs that encourage momentary splurging are observed.

Professor Jeon Young-su, Graduate School of International Studies, Hanyang University

The teachings of the older generation that “if you work and earn, your family helps, and you are healthy, things will get better” are rejected. Although young people endure hardships willingly, this only becomes a reactive growth base for the enlightened market. The point to note is the consumption items spent in the enlightened situation. It can be interpreted as a kind of alternative or substitute consumption. For example, money is spent on relationship-enhancing connections as a substitute for dating and marriage. Buying an expensive computer as compensation for giving up on owning a home is similar. Since saving is meaningless, consumption on expensive hobbies and travel that confirm one’s existence at the moment also expands in the same context. Since they do not spend without stress, it is close to starting costs.

However, it is not wasteful spending. Although it is volatile consumption to others, it emphasizes individual rationality as 'volatile value' because it is value consumption to themselves. Expensive figurines or character dolls, for example, are unrelated to practicality but relieve stress and provide emotional satisfaction, making them close to value consumption. Since it goes beyond frugality, it is distinguished from reality-check spending. The consumption resistance of the enlightened generation means a break from traditional youth consumption. They reject popular items preferred by youth. Thus, they belong to the depression market. Conversely, alternative proposals that encourage enlightened youth to open their wallets become urgent.

Volatile Consumption to Others,
But Wallets Open When It Provides Emotional Satisfaction
'High Price = High Value' Is Denied

There are many examples. A representative one is housing consumption. In the days when 'graduation → employment → marriage → childbirth → child-rearing' went smoothly, young people’s attempts to own homes were natural. Meanwhile, the modest retired generation sold houses secondhand to prepare for old age. This role structure is shaken. The retired generation’s transfers have fewer subsequent generations to receive real estate. In the long term, it can only be a strong signal of market reorganization. In other words, the youth-centered perception shift from 'ownership → usage' blocks generational replacement of secondhand houses. Coupled with income instability, the perception change to give up on high-threshold real estate purchases is widespread among the subsequent generation. The youth group’s refusal of drinking is similar. The subsequent generation drinks less. It is drinking withdrawal. Japan’s decrease in alcoholic beverage shipments is typically understood as consumption abandonment in the enlightened market. Drinking habit rates are higher among women in their 40s (15.6%) and 50s (12.4%) than men in their 20s (10.9%). The drinking withdrawal of the 20s and 30s youth and men is the cause. The industry responds with tailored new products for enlightened consumption. Like Suntory’s high-alcohol canned drink 'Strong Zero Series,' one can easily and quickly intoxicates to attract enlightened youth.

The market and companies are eager to analyze enlightened youth. There are three main points. First, the imprint of the mindset that life is incomplete. Because of this, cost-effectiveness is emphasized. Risk-averse thinking prefers multiple fast fashion items over one luxury item. It is also characteristic that they were born affluent and had little material desire from the start. Adding the experience of low growth, they are accustomed to deflation-friendly products. Fast fashion, outlets, low-cost glasses, convenience store private brands (PB), compact cars, and low-cost carriers (LCC) are familiar from growth. They are satisfied that they can buy quality goods even if poor. The flood of information causes d?j? vu and reduces motivation. Thanks to the internet, even unexperienced things feel familiar, lowering consumption motivation. Indirect experience alone suffices for cars, overseas travel, and food exploration. 'High price = high value' is denied.

This content was produced with the assistance of AI translation services.