Consumer confidence takes a hit

The Conference Board’s most recent survey of consumers indicates a significant fall in confidence.   But rather than listening to what pundits have to say about that, here’s a link to The Conference Board website (click here).

Remember that consumer confidence—as measured by the Conference Board—is not just a measure of how people are feeling.  It’s a measure of how they think they’re going to be feeling in the future.

Implications:  It seems as if the volatile stock market, bickering in Washington and soft demand for workers is starting to take its toll again.  I almost feel like apologizing for this, but it seems that we’ll be talking about Elm Street Economics for quite some time.

It will continue to be important for you to focus on how your company adds value to the consumer’s life.  In this context, the word value is not necessarily tied to price; indeed, it is focused on the benefits one hopes to obtain through the ownership/use of your product or service.  Lots of companies will be dropping price… so that alone is unlikely to make your offer distinct.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Who wants to be a (coupon-clipping) millionaire?

A study by Redplum was cited in today’s Marketing Daily… in a story where 93% of survey respondents say they would continue to clip coupons, even if they won the lottery.  Click here to see the story.

Implications:  This story might be emblematic of the extent to which being frugal has become a culture, not just a matter of dollars and sense.  Of course, if someone actually did win the lottery, their actions in reality might be slightly different than the behavior they predict now.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Consumers remain somewhat credit-averse

A story in today’s USA Today suggests continued restraint with regard to the use of credit.  Click here to see the story.

Implications:  This is one of the major tenets of Elm Street Economics:  Consumers won’t just buy your product because you offer financing; they will consider financing because they want to buy the product or service you sell.  Sell the value that your product or service will add to the consumer’s life.  Then, if applicable, mention that you have cash management options to help them soften the expense over time.

If you think a financing plan is the most important part of your offer… you may not be on the same page with a significant number of your customers.  It's not that people won't use financing.  It is that they'll use it with considerable caution and deliberation.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Supermarkets earn only 51% of food dollars

There's been a lot of talk about how consumers have cut back on out-of-home dining during and following the Great Recession.  But a story in today’s Marketing Daily demonstrates just how much consumption is taking place outside of the home-based kitchen and dining room.  Click here to see the story.

Implications:  If you’re a restaurateur, you might be thinking about ways you can retain (and grow) your share of food purchases.  If you’re a grocer, you’re probably thinking about ways of regaining the revenue share that is now going to out-of-home. 

If you’re anyone else, you should be realizing that some of your greatest competitors come from outside your industry category.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Bigger families, smaller spaces

This week, I had the privilege of talking to a conference of executives from the home furnishings industry, including a diverse range designers, manufacturers, textile companies, furniture retailers and more.  Obviously, the fortunes of this group are tied to the housing market (at least to some extent).

I challenged this group to think about how the housing market (and the family) has changed.  First of all, household size has grown, according to recent Census statistics (see how in this USA Today report).  This expansion is due both to immigration (from cultures where multi-generational households are more common), as well as the foreclosure mess, which caused many families to move in with someone after losing their home. 

At the same time, the number of household has contracted.  I recall a report from last year suggesting that up to 1.2 million households were lost during the great recession (click here to see that MSNBC report).  Presumably, these are households lost to foreclosure, in which one family/owner moved in with someone who could help, be that a parent, sibling, other relative or friend. 

Implications:  First, how long can it be before families that sought shelter with friends or family decide they’ve had enough of multi-family housing, and strike out to re-form their personal households?  This might mean renting a down-sized living space, or perhaps a home very similar to the one they lost!  Or, depending on credit default forgiveness and evolving credit options, perhaps getting back into a home of their own.  This market could soon become a significant opportunity for folks in the home furnishings industry.

Second, aside from those companies who cater to co-op owners in places like Manhattan… who is catering to the needs of families who find themselves crammed-in to a rental, or those multiple families who are jammed into a conventional house?  This lifestyle calls for smaller home furnishings than the huge, mini-mansion-style furnishings that were popular just a few years ago.  Smaller furnishings and accessories might be a really big opportunity.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

C2C marketing

A story in today’s Marketing Daily caught my eye, as it explains how the California Association of Realtors has launched a testimonial campaign targeting first-time home buyers and sellers.  Click here to see the story.

Implications:    In an age where consumers are so inclined to research their purchases, the options they choose to evaluate a product or service is often a social network or chat room where they can hear about the experiences and satisfaction of others who’ve made the purchase.

These California realtors are creating their own word of mouth.  That’s a smart idea, because people can take confidence from hearing from others who’ve made the decisions they’re contemplating right now.  Consumers are inclined to believe other consumers.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Welcome to the (non-traditional) family!

During hundreds of Audience DNA workshops throughout the U.S. and Canada, I’ve had the chance to help media companies understand what kinds of people consume their radio, television or newspaper content.  There’s one very basic set of numbers that never fails to amaze the folks in the room, and that’s the percentage of folks who are living in a traditional family household, compared to those in a non-traditional family.

This week, I’m preparing to speak at a national conference for executives involved with the home furnishings industry.  So I wondered whether the numbers would stand at the national level.  Deirdre McFarland from Scarborough Research in New York was happy to oblige, and provided me with the following information:

26.8% of adults in the U.S. say they are married and have one or more children under the age of 18 living in the household.

56.9% of adults say are simply “married” (with or without children living in the home).

84.7% of adults say they are living in a two-adult household.  Now, that could mean a lot of different things.  These could be couples who are in a committed relationship but not married.  It could be two folks who are simply sharing a residence for economic or convenience reasons.  It could be a 40-something mom with a 19-year old child living at home; in the eyes of the Scarborough Research, that would still be a two-adult household.  Or, it could be a 40-something man with an elderly parent living in his home.  By “two adult household,” we’re looking at a big range of possibilities.  But here’s why it’s important…

Subtract married couples (56.9% of adults) from that group of people who say they live in a two-adult household (84.7%), and you learn that 27.8% of adults are living in a non-traditional family setting.  That means there are more adults living in a non-traditional family household than are living in a traditional, married-with-children household.

Implications:    Just a little simple math can help turn basic data into a valuable insight… and illustrate the extent to which families in the U.S. are changing.

If your marketing is designed to target traditional heads-of-household (those adults who are “Married with Children”), you are technically marketing to a group that is now out-numbered by non-traditional families.   

Data source:  Scarborough USA+ 2011 Release 1 (February 2010 - March 2011).  For more information about Scarborough Research, visit www.Scarborough.com.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Technology tactics you're likely to see at retail during the holidays

Retailers are likely to increase their use of social networking, customer activation via mobile device, and other emerging tactics during the holiday selling season of 2011.   That’s the essence of this blog post from Connected.  Click to link.

Implications:    There's nothing terribly new or dramatic about this list.  But this variety of technology tools illustrates just how sophisticated the consumer has become… and how eager retailers are to respond to this emerging buyer paradigm.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

You’re not just reaching an audience; you might be reaching THEIR audience, too

A story in today’s Marketing Daily reminds us just how important a strong online presence is, and that many consumers will “extend” the value of your site by telling others about the research they were able to obtain.  Click here to see the story.

The article is informed by research from Initiative, which suggests that more than a quarter of consumers say it’s become second nature to share information with others when they’re done researching a prospective purchase.

Implications:    Is your website contagious?  Does it provide the kind of assistance and information that compels a customer to tell others about your site, company, product or service?  Have you made it easy to share by email, social media or other means?

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Higher food prices likely

Today’s USA Today includes a story about the prospects for higher corn prices due, in part, to a challenged U.S. crop this year.  Click here to see the story.

Implications:    The other part of this equation is higher world demand on a weaker world supply.  With such a commonly used commodity feeling the effects of at least short term (2011-2012) inflation, consumers are likely to spend more for the same grocery store staples and restaurant favorites.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

The class of 2015: Wired and well branded

One of the more popular stories from Marketing Daily this week provided a glance at today’s freshmen class as they arrive on campus.  The article gives this new generation of college students a lot of credit for the way they’re using social network to build their personal brands.  Click here to see the story.

Implications:    Whether you’re a neighborhood bar and grille where friends can gather, or a home furnishings store that helps folks choose the kind of goods that make entertaining a little more fun… you might be in the business of helping your customers “brand” their lifestyles.

Don’t just think in terms of the brands you sell.  Think of the personal brand your customer would like to build.  I bet you can help them.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

The changing face (and families) of America

Last week, USA Today published an important story about shifts in the U.S. population that continue to be revealed by the 2010 census.  Among the findings:  We’re having fewer children, and we’re having them later.  Blended families are showing up in big numbers.  And today, more than 40% of babies are born to unmarried moms.

In other words, a family in 2011 is built differently than a typical family of even twenty or thirty years ago.  Click here to see the story.

Implications:    Next week, I look forward to speaking to a group of executives from the home furnishings industry at a conference in Raleigh.  Imagine selling furniture in 2011; it is an era where home ownership, household incomes, and even the definition of “family unit” is, itself, being re-defined.

How is your company, product or service being impacted by the evolution of consumers and their families?  Who owns the decision for the household, when the family living in that household might not be the traditional “married with children” nuclear family?

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc. 

Google makes its move in mobile

This week, Google announced that it will buy the mobile phone side of Motorola for $12.5 billion.  See a story about the move from today’s New York Times by clicking here.

Implications:    Google knows just how widespread the use of smartphones has become, and just how pervasive the use of mobile technology is likely to be in the future.  Do you?

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Don’t bank on it: How pensions and investments are changing in the mind of the consumer

Before I clean the weekend’s news stories off my desk today, I’d like to share one that came from Saturday’s New York Times, which illustrates what future tensions could look like as spending cutbacks trickle-down from the federal level to the state, city, and even school district level.

In this article, former employees from a small Rhode Island town are facing a cutback in pension payments from the city they used to work for.  (At a time when bondholders are seeing no such cutback.)  Click here to see the story.

Implications:    As the story suggests, it is more likely that a court—rather than a city council or mayor—will decide the outcome of this case.  I raise the issue not for its political ramifications… but to further illustrate the creative fallout that continues to make itself known in the wake of the recent recession.

In what ways might these kinds of headlines change the way consumers save for retirement?  In what ways might these issues cause 45-64 year-old consumers to become even more cautious about spending (since they are close in proximity to retirement)?  In what ways might these stories discourage younger folks from participating in a pension plan, 401K or other employer-sanctioned investment plan?

If you’re in the financial planning, investment or banking business… life just threw a whole collection of new questions your way!

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Digital coupons: In addition to—not instead of—traditional Sunday newspaper

A recent Marketing Daily posting suggests that all of those new players in the realm of couponing are joining—not replacing—that weekly sift through the Sunday paper looking for bargains.  Click here to see the story.

Implications:    We’re often tempted to try the new things media has to offer, and that’s good.  But we should maybe think twice about saying “out with the old and in with the new.”  Novelty is nice, but many consumers still like to go with what they know.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Social Responsibility: Making money is an important priority to most programs and all businesses

An interesting story in today’s New York Times reminds us that without making a profit and staying in business, few companies can win with their social responsibility initiatives.  That’s a difficult premise to argue with, isn’t it?  Click here to see the story.

Implications:    Do good for the people around you.  But do well, too, so that you can survive and thrive tomorrow, to do good again.

Profit is the responsible thing to do.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

More evidence that we've entered an age of "inconspicuous consumption"

Today’s USA Today featured a story about the shrinking size—and reduced glitz—of the RV’s that are growing in popularity in today’s economy.  Click here to see the story.

Implications:    It is interesting to note that there are still people out there who are ready to indulge in a big-ticket purchase like a new RV.  But they’re doing it in a way that’s a little less showy, and easier to rationalize as a common-sense purchase.

Over the past few years, I’ve even heard that some celebrities are shopping on Rodeo Drive, but requesting a plain, logo-free bag to carry their purchases in… so as to avoid showing-off that they spent money in an expensive store.  Do you sell an indulgent product or service… that people would like to indulge in (but keep quietly to themselves)?

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Schools are hurting and you can help (and do well as you do good!)

The Engage:  Teens blog from Media Post launched a three-part series today about the state of education and school budgets.  While the opening premise seems to focus on the challenges that schools are facing (slashed budgets, too few teachers, and greater than ever scrutiny, for example), you’re also wise to consider how these issues might represent opportunities for your company, product or service.  Click here to see the story.

Implications:    If you’ve ever considered a cause marketing initiative that benefits education, now might be a great time to revisit the issue.  Parents are less likely to assume that government (even at the local level) can solve all of the fiscal challenges their communities are facing.

Could you sponsor a section of the local school library?  Provide snacks to after-hours school sessions?  Does your product advance the goal of education?  Could you run a promotion that generates cash for your local school district?

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

What the traditional American household looks like now

Today’s USA Today features an impressive story about shifts in the population landscape that have been discovered in the discourse of the 2010 Census.  Click here to see the story.

Implications:    Fewer children, more Hispanic and Asian Americans, more extended families living in a single dwelling… and 41% of babies are born to unmarried moms.

Things are changing.

Do you serve the same target consumer today that you did ten or twenty years ago?  The face and household composition of the U.S. continues to change… and it’s critical for companies to pay attention, if they are to realize the opportunity that these shifts represent. 

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Technology impacts affluent consumers

Today’s Research Brief reinforces what most of us already knew:  More and more affluent consumers are using technology to make their shopping and buying faster, more efficient, and more considerate.  (Click here to see the newsletter.)

Implications:    Don’t consider the traditional web or smartphones to be “just something else to worry about.”  Often, these sites and devices are preferred channels through which prefer to do business.

Many people prefer to use technology to aid their shopping.  Do they prefer you?

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Supermarkets: Expect smaller trips and more planning

Supermarket Guru Phil Lempert suggests that consumers will continue to carefully manager their grocery budgets… as prices on the shelves are expected to rise.  Click here to see the video.

Implications:    If customers are going to plan more carefully, are you offering tools online (and elsewhere) that help them plan?  And if prices are expected to continue their rise, we can expect consumers to continue their scrutiny.  Does it make sense to start bundling more products into a “meal cost,” much as one might see on the menu at a restaurant?  Just a thought:  Consumers continue to change the way they think about buying; that fact should influence the way we think about selling.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

A street-level look at the political and economic landscape: Ugly

There has certainly been no shortage of chaos over the past week.  The debt ceiling conflict was solved (for now) last Monday and Tuesday (see this Denver Post story).  But it wasn’t accomplished without casualty:  By Thursday, polls had been published illustrating the dismal approval rating of congress (see this NY Times story), and the press has been no less brutal for the White House.  Late Friday, Standard and Poor’s reduced the U.S. credit rating (as published here by the Washington Post).

Implications:    On a positive note, the U.S. economy added more than 128,000 jobs last month… and that number would have been considerably higher if not for the state government shutdown in Minnesota, which temporarily shed 30,000+ positions.  But based on the few polls and considerable press devoted to public sentiment, I have to believe folks are fed-up with the way the system is working right now. 

Heading into an election cycle, we can expect the rhetoric to increase, and the discontent right along with it.  Waiting for the economy to calm is probably not an option.  Getting to know your consumers better than you ever have—and serving them more effectively and efficiently than ever—is going to remain critical for the foreseeable future.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Loss of home equity alters retirement plans for many

An important story in yesterday’s USA Today helps shed light on how retirement aspirations are changing for many people, in response to a loss of equity in their home, as well as other investment issues.  Click here to see the story.

Implications:    I’ll be talking with a home improvement contractor later this morning; that’s just one industry impacted by home values that shifted in response to the housing meltdown of 2006-2009.  There are many others, including some categories that are not, at first glance, directly connected to the real estate market.

Are you ready to serve the new age senior, as they move into their retirement years without quitting work?  How will the retirement needs of Baby Boomers be different than their grandparents’ needs during the same life stage?  What products or services do you offer that might help?

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Coupons remain strong in 2011

Today’s Research Brief explains that coupon remain a strong savings tool for consumers, especially where packaged goods are concerned.  Click here to see the story.

Implications:    In print, online, or via SMS or QR Codes captured on mobile device, folks are still looking for ways to manage their family budgets carefully.  Have you considered the tactic to make your product or service an attractive alternative?

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Parents hit the “off” switch on electronics

Sales of laptop computers and other electronic devices for back-to-school have been resilient even through the recession and most of the recovery; that is, until this year.  According to a report covered today in Marketing Daily, fewer parents intend to equip their kids with those gadgets before heading back to the classroom.  Click here to see the story.

Implications:    If you’re in the business of selling personal electronics, smartphones, touch pads or laptops… it would be a good idea to focus on the functionality of the product (what the machine will help accomplish), rather than the hipness of the product.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

What spending cuts could mean on Elm Street

The debt ceiling compromise that passed the house yesterday (and which should pass the senate and be signed into law today) could have a significant impact on the recovery, according to this story from USA Today (click to link). 

Implications:   The original idea behind Elm Street Economics was to suggest that small business owners, managers and marketers should pay less attention to Wall Street and Washington, and focus more on their relationship with consumers; those folks who ostensibly live on the Elm Street cul-de-sac within a few miles from their place of business.

Experts fear (according to the USA Today story) that a fragile economic recovery (just 1.3% economic growth last quarter) could be hampered in the coming months by spending cuts included in the debt ceiling compromise.

Stay tuned.  It sounds like focusing on consumers will be just as critical in the next few years as it has been for the past four.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Americans spend less on food

Today’s Lempert Report states that American spend less on food than most of the rest of the world, as a percentage of household income.  Click here to see the story.

Implications:    The piece left me thinking about the way this simple fact leaves more money to be spent on everything else. 

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

The political “to do list” looks different today

A pair of stories in today’s New York Times signals a shift in the focus of U.S. government in coming weeks and months.  First, this story reviews the passage of a debt ceiling agreement (click to link).  Pundits expect the senate to approve the house bill by early afternoon and that it will be signed by the president later today... hours before the treasury department had said it would be unable to meet all of its financial obligations.  Secondly, another Times story suggests that attention will now be shifted to job creation and the economy (click to link).

Implications:    I’ve seen a lot of press focused on the frustration of people (aka voters, consumers) about their politicians, lately… and wondering why the debate about the budget and the debt ceiling has seemingly cost them months of getting anything else done.

It will be interesting to see, in the coming election cycle, whether people remember how much (or little) got done by their employees this summer.  (And I make that statement in a completely bi-partisan tone.)

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.