Guillermo Oliveto: “The consumption that redeemed the pain of the pandemic is over, the blackout and 100% inflation have woken us up”

Inflation exceeding 100% per year, the massive blackout and threats to the family of Lionel Messi – the most popular and beloved idol – marked the month of March as the end of a stage of consumption (ephemeral but finally consumption) and the trend of strong change in the mood and expectations of the middle class.

The beginning of this new stage, with an impoverished middle class resigned to living without long-term projects, is indicated by Guillermo Olivetoconsumer aware of the habits of Argentine society and founder of the consulting firm W.

-After a year of increased post-pandemic entertainment and wellness consumption, you are already seeing a shift in trends, how is this reflected in the middle class?

-I had already suggested that the “Cinderella effect” would arrive in March, that the illusion would be eaten away and there would be a harsh encounter with reality. Reproduce the concept of Eric Hobsbaum of “short century” and “long century”, there was a very long year -in terms of non-chronological conduct- which was from the end of the pandemic on September 21, 2021 and which ends in March of this year , where driving was in full postmodernity, Carpe Diempure present, I want to live and nothing interests me.

It greatly increased the propensity to consume, virtually eliminated savings, and people with much or little, whatever they each had, decided to redeem themselves for the pain they had suffered during the pandemic. This long year has favored the ephemeral and very short-term consumption of pleasure at the moment, ranging from concerts – the example is Coldplay – to restaurants, bars and pizzerias.

This model of conduct sought to escape from reality. Argentinians have built “wellness bubbles,” the concept of fake dementia born out of TikTok. In March you found 100% inflation, which until now -gradually- was masked by a wear effect, where the reference had been lost because it is rising all the time.

But when it comes to tuition and rent for the middle class, and for many young people, they suddenly cost twice as much. There, the shock occurs and the float turns into a pumpkin.

-Why does March mark the beginning of the new stage?

-I anticipated that we were going to enter this environment. I never imagined that on March 1 there would be a massive blackout and on March 2 there would be a brutal threat against the most popular person who had just given Argentinians the greatest joy for a long time. Both of these revivals threw people back into reality, accompanied by 100% inflation.

There is a climate of annoyance, disappointment, anxiety, I no longer have a place to go or a bubble to invent. The bubbles – exits, animations – will continue but more spaced out. The middle class will be forced to define what it continues to maintain; what changes service, brand, place of purchase and what goes out directly. For the most part there is a demotea step backwards, which for the middle class is something difficult to digest.

He does it because he has gone through different circumstances, always with a lot of anger and disappointment, and for 6 out of 10 Argentines aged 40 or younger, this is the biggest inflation they have experienced in their lives. . It is also a novelty. There are young people who work and who can no longer pay the rent.

– Have we gone from a middle class that has resigned from the car and its own house to one that has resigned from private school or supermarket shopping?

– We have moved from the long term to the short term. Home sales are half of 2017. Car sales are 40% of 2017. And overseas travel is half of 2017. For many, the world was a long way off. It is consumption without a project, without illusions and without anything in the long term. Before the latent desire was to buy a house, now it is to pay the rent. This is where the deterioration lies.

– This disappointment of no longer belonging, in what habits can it be seen?

-We are going to have much more labile and volatile loyalties. The consumer says “I will not marry anyone”. Change place of purchase, brand, try to maintain this consumption in a product or service that brings you a certain well-being. With whom and by what will be seen. It’s hard to maintain loyalty in an environment where people want to consume but can’t. Alternative channels are beginning to appear, showrooms, purchases via social networks, wholesale or bulk sales channels.

The Argentinians have strategies in their Crisis Manual 1, 2, 3 and Postgraduate. It is a non-explosive crisis, it is implosive and gradually deteriorates. While everyone was waiting for an epidemic, mini-crises followed one another.

– Does the duration of this crisis mark a difference with what happened in 2001?

-We found a lot of people saying it was worse than 2001. It was a spike, a rebound and it came out. Already in 2003 you were in another film. Here, the feeling is a swamp where you sink and there is no way out. That’s why people are apathetic, apathetic, with almost feelings of depression because they can’t see the exit. Live today, apathetic as it may be, enjoy yourself for a while – this fleeting thing – and come back to apathy. Here we are.

-This is why the desire to emigrate is growing

-For a generation trained in globalization and connectivity, the fact that the world is so far away makes it meaningless. They wonder “why do I do what I do if I have a job and I can’t save, I can’t travel, I can’t go out into the world, learn, buy technology “. For them, it’s the most important thing in the world because they grew up in this environment. Today, among young people leaving the country, it is “the” topic of conversation.

Some leave and many don’t, but they speak it all the time. But those who want to stay must ask themselves why, which is very sad as a society. The only ones who have found a way around this problem are those who work from here abroad and collect dollars. The young man in pesos is a young man who sees himself as having no future.

-How do you expect consumption to be during this year 2023?

-This year, it’s like a high-level match: drawing is business. But we have to see if we are even. If growth is zero or -3, if inflation is 100% or 120%. Generally speaking, all signs point to it being the same or worse than 2022. Above all, it looks more like the second half of last year. The last mini-crisis that society remembers dates back to last July with the departure of former Economy Minister Martín Guzmán.

– This persistent fall of the middle class, what effects does it have in the long term?

-I think the expectation is so low that a change in conditions can generate some excitement. People are so in disbelief, in ‘won’t work’ mode, that with 4 or 5 things, you might be able to surprise them. It’s like going to the movies when you don’t know what the movie looks like. This is the big difference between the 2023 elections and the 2015 elections. Society comes to the electoral process with very low expectations, which may end up being better. With little, you can begin to reverse this situation of widespread sadness.

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