[AldonSseulJap] The Shadow of Recession... 'Yolo' Goes, 'Yono' Comes

Editor's NoteAlways Done with Sseulful Japhak Encyclopedia. 'Aldonssuljab' will serve you only truly 'money'-worth information among countless economic articles.

How do you feel about economic booms and recessions?

The media reports

'Card loans and cash services hit a record high of 44.7 trillion won... Delinquency rates soaring'

'Corporate sentiment index worsens for three consecutive months... Prolonged domestic demand slump'

'OO company’s first-ever voluntary retirement'

and other headlines pour out, making us feel the economy is deteriorating.

Above all, I think the most intuitive indicator is 'consumption.'

People tend to increase consumption when the economy is booming or liquidity is abundant in the market, like during COVID-19,

but reduce consumption first when the economy is tough.

Therefore, a new consumption trend called the 'Yono tribe' is emerging, especially among young people.

Let's take a look at the characteristics of the Yono tribe and what financial products the financial sector is offering to capture this group.

YOLO Tribe vs YONO Tribe

Most of you are probably familiar with the YOLO tribe by now.

For a while, economic trends could hardly be explained without mentioning 'YOLO.'

The YOLO tribe is well known as an abbreviation of 'You Only Live Once,' referring to a consumption style that does not hesitate to make bold expenditures beyond one's income level.

Since the early 2010s, as skepticism about the future grew and a mood to focus on present happiness formed, YOLO became a major consumption trend among young people.

Even if most income is saved, the reality of barely being able to own a home in a lifetime increased skepticism about future preparation, spreading a consumption culture prioritizing current satisfaction.

According to KB Real Estate Data Hub, as of Q2 2022, the average household income in Seoul was 59.1 million won, and the average housing price was 875 million won, meaning it would take about 30 years to buy a house even if half of the income is saved.

Amid the prolonged YOLO trend, wage increases lagged behind inflation, and high interest rates increased debt repayment burdens, continuously reducing the economic spending capacity of young people.

According to Statistics Korea, the consumer price index rose 3.6% year-on-year in 2023, while the average income of household heads under 39 increased only 1.9%, from 64.7 million won to 67.62 million won.

Wage increases failing to keep up with inflation increased household economic burdens.

Especially, 74% of those aged 20-24, 44% of 25-29, 31% of 30-34, and 29% of 35-39 earn wages below 2.5 million won per month, near minimum wage levels.

As a result, globally, a new consumption trend called 'YONO,' with the motto 'You Only Need One,' has emerged, focusing on buying only what is necessary and reducing unnecessary consumption.

Characteristics of the 'Yono Tribe,' a New Consumption Trend Among Young People

So, what are the characteristics of the Yono tribe?

The Yono tribe can be characterized by not being swayed by brands and marketing and actively seeking cheaper products with the same utility by personally searching.

They pursue practicality instead of luxury, and consider value for money, emotional satisfaction, and even practicality?what can be called 'gasilbi'?in their consumption.

This characteristic of the Yono tribe appears throughout consumption.

A representative example is the dining industry.

Fine dining and omakase rapidly spread mainly through social media, popular among the YOLO tribe.

Unlike the YOLO tribe, the Yono tribe prefers home-cooked meals and inexpensive, easy-to-prepare convenience foods over expensive fine dining and omakase.

According to the Ministry of Agriculture, Food and Rural Affairs' dining industry business condition index, the dining industry sales index was 86.91 in Q1 2023, gradually falling to 73.67 in Q4.

Meanwhile, the convenience food market grew rapidly.

As dining prices rose, demand for home meals increased, with GS Retail's GS The Fresh grocery sales from January to July this year up 18.2% year-on-year, and Lotte Supermarket up 15%.

Convenience store CU's home meal replacement sales growth rate rose from 16.4% in 2022 to 26.1% in 2023, and GS25's home meal replacement sales also showed strong growth, from 41.2% in 2022 to 51.0% in 2023.

Not only in dining trends but also in financial management methods, phenomena reflecting the Yono tribe's characteristics have become popular.

Extreme spending reduction methods like the no-spending challenge and 'jjantech' (frugal tech) are trending among the Yono tribe.

The no-spending challenge involves setting a period during which no consumption occurs, often organized in open chat rooms titled 'Beggar Room' where many participate.

Participants certify activities like 'packing lunch boxes instead of eating out' and 'brewing coffee in a tumbler,' spreading it like a game.

Financial Sector Also Targets the 'Yono Tribe'

The financial sector is very interested in developing various content that naturally enables the young generation, who confidently express Yono tendencies and enjoy spending, to practice this lifestyle.

Not only fintech and internet banks but also first-tier banks are competing to launch financial products targeting the Yono tribe.

'Toss' is considered a representative jjantech app.

The 'Turn on Toss Together and Earn Points' service launched in January 2023 surpassed 6.6 million cumulative users in six months.

Kakao Bank also jumped into capturing Yono customers.

On August 26, it launched the '26-week Savings with McDonald's' product.

Starting from as little as 1,000 won and designed to increase the amount weekly, it lowers the entry barrier for young people. If savings succeed in designated weeks, six discounts on six popular McDonald's menu items are provided.

Previously, Kakao Bank's 'Piggy Bank with Megabox' surpassed 500,000 accounts within a week of launch, gaining great popularity.

Notably, 60% of subscribers were in their 20s and 30s.

In the fintech industry, BankSalad is a representative example.

In June, it launched the 'Salad Game,' a spending loyalty game where five team members spend within a team budget for a set period and receive prize money proportional to their spending.

The initial budget of 250,000 won can increase up to 540,000 won daily through various missions linked to MyData, such as 'not drinking coffee' or 'not using delivery and taxis.'

KB Kookmin Bank was the first first-tier bank to launch a budget phone service in November 2019.

Reflecting the Yono tribe's characteristics, it targets them with high quality and various benefits.

▲ 24/7 customer center operation ▲ First budget phone operator to launch 5G plans ▲ Maintaining membership services with rich benefits ▲ Offering friend combination discounts, providing services comparable to the three major telecom companies.