Report suggests consumers are loosening some of their aggressive money-saving tactics

Observation:  Today’s Research Brief indicates some consumers are less likely to forgo that morning cup of specialty coffee, less likely to brown-bag their lunch, and slightly less likely to buy store brands.   The observations are fueled by a Harris Poll survey from December, 2011.  Click here to see the full story.

Implications:   Saving money became an extreme sport during the Great Recession, but it should not be surprising that those extremes were not comfortably sustainable for the long haul.  As breadwinners are expected to do more and more at work—with some indeed carrying two or more jobs to replace one that was lost—it only makes sense that fatigue would set in… and some of those small indulgences or conveniences we used to enjoy would return.

Are you seeing any indications of a consumer that has given herself permission to spend just a little bit more freely?

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

Generational Economics: The Age of Acquisition

Marketing Observation:  Generally speaking, the Age of Acquisition refers to the collection of people are between the ages of 18 and 34.  (Therefore, at this writing, we could loosely refer to this group as The Millennials.)  Acquisition is a great moniker for this life stage, because their appetite for consumer spending seems insatiable.

I realize the term “Acquirers” can sound a little cliché, just like so many other terms the advertising industry has invented for itself.  So to fully appreciate the true significance of this group, think about this line of questioning: 

• Did you own your first NEW car on the day you turned 18?  Did you by the time you turned 34? 
• Did you have a place of your own by the time you were 18?  Did you by the time you were 34? 
• Had you filled that place with furniture when you were 18?  34? 
• Did you have a spouse or significant other by the time you were 18?  But by the time you turned 34? 
• Did you have children when you were 18 years old?  Did you by the time you turned 34? 

This line of questioning helps illustrate just how little you had at age 18, and just how much you had acquired by the time you turned 34.  That’s why we call it the Age of Acquisition:  People in this life stage seem to be consuming everything in their path.

Not everyone will answer these questions precisely the same.  But generally speaking, at age 18 we’re often born into consumer adulthood with virtually nothing, except that which our parents let us take from home.  And by the time we’re 34, many of us owned at least one copy of almost anything it takes to run a typical household.  (And some stuff you don’t need to run a household!)

In addition to those young adults who will leave their parents home, go off to college and then venture off to start their own life, there is a large and growing segment of young adults that are having difficulty with this move, or are purposefully delaying it.  Often, this hesitation is in response to the post-recession labor market.  Often unable to find a full-time job in their chosen field after graduating from college, many twenty-something adults return to their parents’ home until their income can match the cost of striking out on their own.  Think of them as return-to-nesters.  By the way, this can still be a very attractive target group, as they often earn an income that is not going toward a rent or house payment (if they are living in a home that is paid for by someone else).  That leaves a lot of discretionary income for things like entertainment, clothes, electronics, etc.

Marketing Implications:  Serving people that are in the Age of Acquisition is no small challenge.  Yes, with all the spending they do, one might be tempted into believing “this’ll be easy.”  But adults 18-34 are busy building families (although later than ever), climbing their corporate ladders, and still drawn to engaging in a highly active social life. 

Millennials are doing things differently, right down to the homes they live in.  Where there may once have been a living room, there is now a game room (equipped with at least one game console and a plasma flat-screen).  Where there once was a formal dining room, there might now be more of a social center, which can be used for homework (career or college), entertaining, or board games with the family.  They’ve never known a world without very advance personal computing, and they’re driving the break-neck speed of innovation in smartphones, tablet computing, and more. 

The Age of Upgrades is ready… to spend with companies that have upped their game.

Mike Anderson, for The Marketing Mind consumer trends blog, service of The Center for Sales Strategy.  

Generational Economics: The Age of Upgrades

Marketing Observation:  To fully appreciate why people age 35 to 49 behave the way they do, we have to reflect on the type of spending that was going on when they were younger (age 18-34, or “the Age of Acquisition”; see immediately above).

Think about all those belongings the typical consumer acquires in their 20s and early 30s, which they usually did not own when they turned 18:  New cars, homes, furnishings, appliances, educations, spouses (or partners), children and more.  How did we acquire all of these things while earning what amounts to the median salary of a 26 year-old?

First, we had to make choices.  Compromises.  While we were buying almost everything, we could not afford to buy the BEST of everything.  So, we purchased a lot of entry-level goods.  From cars to starter homes to knock-down furniture… you know the routine.  Secondly, we racked up a lot of consumer debt.  There’s a reason credit card companies so often target young adults and teenagers.  A lot of people use credit cards to feed their insatiable consumer appetite during the age of acquisition.  And finally, we got help from the Bank of Mom and Dad.  Plenty of middle-age and older parents can tell you how expensive it can be to help their adult children get up-and-running.

But, lets get back to the Age of Upgrades.  By the time we turn 30, 35, or 40 years old, our purchasing priorities change a bit.  By now, most folks have their career well established, and a family underway.  And since you already own much of what you need, you shift from simple need-based purchasing to more want-based purchasing. You already have a (home, car, furniture), but now you’re ready for a nicer (home, car, furniture).   You decide it is time to jettison the knock-down furniture, and replace it with a solid oak wall unit.  Out with the entry-level domestic hatch back, in with the imported SUV. 

Note that for the Age of Upgrades, I’ve arbitrarily drawn the line at 35 to 49.  You might draw the line differently for different categories of products and services.  But either way, it is that life stage where low cost is replaced by quality as a purchase priority.  You’re often after products that are thought of as premium, rather than famous for being low-priced.

Marketing Implications:  A good word for people in their Age of Upgrades is “momentum.”  Their careers are moving forward, their children are growing, and life is moving at a very fast pace.  It’s a lot of work… and this group has every right to start feeling like they deserve a taste of the finer things (which is a relative term). 

What does your company sell that might be seen as a small reward or a well-deserved indulgence?  Does your marketing talk about the value-added services that might make this group feel like a pampered guest?  What do you offer that might be particularly active to their pride and joy (their children)?  Does your company, product or service help solve the time-sensitivity issues that can exist in households where people are juggling the demands of their career with the needs of their family?    

The Age of Upgrades is ready… to spend with companies that have upped their game.

Mike Anderson, for The Marketing Mind consumer trends blog, service of The Center for Sales Strategy.

Generational Economics: The Age of Increased Equity

Marketing Observation:  Draw an arbitrary line around that segment of the population that begins at around age 45 and runs up to around age 59.  This is the Age of Increased Equity.  Why do I make that assertion?

In this life stage, there is a very good chance that the careers in a household are very well established.  People in this age group are often earning at a higher level than at any other time in their lives.  (Of course, some households have had to adjust that relative income due to recession-related job loss.)  Still, many people in this life stage are working in professional occupations (doctor, lawyer, engineer), as upper managers and executives, or have been in a blue-collar job long enough that they could be called, “Blue Chip Blues.”   

Meanwhile, this pinnacle income is happening just as the fixed expenses in their lives are beginning to fall.  Think about this combination of events:  By now you have a solid career, lots of experience, and you’re probably earning more money than ever… and it’s happening just about the time you’ve pared-down your consumer debt, kids are leaving home, and you may even be close to paying off your mortgage. 

True, there is probably college tuition to worry about, and helping young adult children get their feet on the ground… and a lot of folks in this life stage are starting to realize they have some catching-up to do with their investments and retirement savings.  But each of these expenditures is nonetheless, “discretionary.”  That’s the best way to describe the Age of Increased Equity.

Marketing Implications:  Life for many people age 45-59 looks a bit different today that it did just five or six years ago.  Their post-recession realities have them revisiting how much equity they have in their home and other hard-earned investments.  (A lot of us have some catching-up to do!)  They’re helping adult children get on their feet under economic circumstances that seem more difficult than when they themselves were that age.  (I don’t mean to speak for all Baby Boomers, but when I reminisce, I’m more inclined to think of things like the moon landing and rock & roll, rather than the oil embargo of the mid-seventies and the stagflation of the late 70s and other woes.) 

Few people age 45-59 were born into technology… they’ve had to adapt.  They’re competing with a younger labor force that has never known a world without the personal computer.  They’re likely to plan on working longer to compensate for shrunken investments and the fear that social security won’t survive their full lifetime.

In spite of all the challenges they face, the Age of Increased Equity has earned the right to indulge.  Nicer cars.  Nicer homes.  And not just travel… but experiences.

Is this a group you are (or should be) selling to?  Have you stopped to think about—or better yet, talk to them about—what their preferences and priorities are?

Mike Anderson, for The Marketing Mind consumer trends blog, service of The Center for Sales Strategy.  

Generational Economics: New Age Seniors

Marketing Observation:  Once upon a time, you might have referred to people age 60-69  as “upper demos.”  But that is an outdated notion, one that has not kept up with the changing face of demography, at least in the industrialized parts of the world. Here’s why I say that:

Fifty or sixty years ago, life expectancies were different than they are now.  People often retired from their careers at 62 to 65 years old… and then enjoyed life for a few years before their health began to deteriorate (or they just plain tipped over).  Now, life expectancies are much, much longer—approaching eighty years old—and of course many people are living into and through their 90s and beyond.  These longer lifespans are having a dramatic effect on how we’re living life, especially after age sixty.

Retirement savings have to last a lot longer.  So we’re finding that “retirement” rarely means, “the end of employment.”  For folks in their 60s, it often means quitting the job they’ve always had to have—for economic reasons—so they can take the job they’ve always wanted to have.  Someone who has worked in a confined space for a lot of years might decide to find a job where they can get out and meet people.  Others take a position that lets them fulfill a passionate interest or hobby.  In fact, the concept of “retirement” is making way for the idea of “re-hirement.”  And to the New Age Senior, that return to the workforce serves two purposes.  First, it can be an important supplement to a retirement savings plan that simply has to last longer than it might have, say, fifty or sixty years ago (retirement will last longer than it did back in the fifties for most people). 

But also, the right job can be a source of stimulation and self-actualization for the New Age Senior.  Just realize that their motives for wanting to work might be different now than they were during an earlier career.  Changing jobs can actually be seen as a way of, “giving back.”

Marketing Implications:  Whether you want to sell financial products and services to people who are re-thinking what retirement means, or goods to help people get established in “Career 2.0,” there is a tremendous amount of opportunity in targeting consumers in their 60s.  They still want to travel, spoil grandkids, and play golf.  But they’re looking for ways of fitting all those activities (and more) into a lifestyle that is busier than generations before them at this age.  They’re very health-conscious, eager to stay active, and more technologically savvy, too.

Is this a group of consumers you’d be smart to reconsider, or consider in new ways?

Mike Anderson, for The Marketing Mind consumer trends blog, service of The Center for Sales Strategy.  

A look at the chasm between rich and poor

Observation:   A recent Research Brief newsletter suggests that the chasm between those who have and those who have not can look differently, depending on the group you are in.  The article cites Pew Research in suggesting that 66% of those surveyed think the conflict between rich and poor is “very strong.”  But feelings can vary significantly depending on political view, socio-economic status and ethnicity.  Click here to see the briefing.

Implications:   We’ve been referring to the current economic climate—and the chasm between rich and poor—as the dumb bell economy.  A lot of people at least perceive that the middle class has shrunk… and that there are lots of people on either end of the financial spectrum, and fewer folks in between. 

How are your customers feeling?  Are they, like many people, trying to decide where they fit into the spectrum?

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

Bank loyalty higher than thought, according to survey

Observation:  A survey conducted by TD Bank indicates that more people are loyal to their bank than wide-spread negative press might lead one to believe.  That’s according to a story in today’s Marketing Daily (click here to see it).

Implications:   This is positive news for people in the financial industry… but I bet the satisfaction level varies widely from one institution to another, depending on the extent to which a bank nurtures their relationship and refines their service to customers.

Like many consumers, my wife and I are satisfied with our primary bank due to the fact that we seldom come into contact with it, directly.  With direct deposit, automated bill pay and online services, it is rare that we actually talk with a human or walk into a bank branch. 

If the relationship that your company, product or service has with consumers is similarly automated, in what ways might you maintain an element of contact or communication with customers that is truly valued and appreciated?

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

Coupon use remains strong

Observation:  An article from yesterday’s Supermarket News indicates that consumers redeemed an estimated $4.6 billion in packaged goods coupons last year, up 12.2% from 2010.  The story, citing data from Valassis, explains that 27% of coupons required multiple product purchases (up 2% from 2010), and had an average face value of $1.54.  Click here to see the full story.

Implications:   The difference between a fad and a trend is much like the difference between a wave and a tide; one comes and goes quickly, and the other stays for a longer period of time.

It would seem that coupons have found favor not just as a quickly-fading fad, but that they will be an attractive incentive to consumers for a longer period of time.  More evidence that consumers continue to reconcile their purchasing behaviors, and adapt to the new realities that exist in the wake of the Great Recession.

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

Some good news for the end of the week

Observation:  This morning’s Commerce Department report indicates the economy grew at an annual rate of 2.8% during the final quarter of 2011, for a net expansion of 1.7% in 2011.  Click here for more details, provided by a Washington Post story released earlier this hour.

Implications:   It’s always fun to end the week with a little good news, and this is that.  But any business owner, marketer or manager should enjoy this story, and then remember that the most important economic indicators come not from Washington or Wall Street, but from the consumers they serve on a daily basis.  In this age of reconciliation, most people are more focused on their household (micro) economy than the station of the national or global (macro) economy.

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

Seniors that just won’t quit

Observation:  One of our favorite ESE topics is Generational Economics… which is to consider how consumer behaviors and purchasing priorities evolve as we move through life.  In today’s USA Today, there’s a story about a man who left retirement to re-join the workforce.  While the article focuses primarily on just one individual, there are scores of people who have come out of retirement, literally, due to both an uncertain economy and sheer boredom.  Click here to see the story.

Implications:   As more seniors continue to work, they continue to commute, dress for success, and grabbing lunch with a colleague.  They’re eager to be entertained or relax after work, and looking forward to having some fun this weekend.

Does anything in that lifestyle sound like a sales opportunity for your business?

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

Walgreen’s morphs the niche they are in

Observation:  It is an interesting time to watch the nation’s largest drug store.  First, in a gutsy revolt against the healthcare system, the chain recently announced they would no longer accept prescription orders reimbursed by insurance-giant Express Scripts.  According to a recent video from supermarket expert Phil Lempert (click here to see that footage), that move could represent as many as 80 million prescriptions.  But that was a hit Walgreen’s was apparently willing to take, in defiance of the prescription management company’s effort to shrink the store’s profit margin on medications.

Another story—this one from Forbes—suggests that Walgreen’s is moving toward a business model that is much more consumer-centric, with product offerings that include a widely expanded beauty products, select groceries (including “wellness” organic foods), wine and cheese shops, and even coffee shops.  Click here to see that story.

Implications:   This is just my opinion, but I see this move as Walgreen’s decision to not let Express Scripts define the business they are in… and take control over that decision for themselves. 

What business are you in?  Is the answer to that question decided by a landlord, vendor or supplier?  Or is it defined by you and your customers?

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

With growing fuel prices, shrinking modes of transportation

Observation:   Today’s Marketing Daily features a story about the increasing number of people who are adding a motorcycle or scooter to their family’s transportation fleet.  This is a trend driven less by recreation than hedging the household budget against  the price of gas.  (To sift through all of our postings about The Fuel Economy, click here.)  This story gives hope to cycle shops that were having a hard time replacing their now-aging profile of baby boomer customers.  (To see the full MD story, click here.)

Related to today’s story, the North American International Auto Show was held in Detroit earlier this month, and there was no shortage of news about the futuristic cars of tomorrow.  Again, much of the pitch was related toward higher fuel costs in the years ahead.  Several stories—this one from the New York Times—explained that alternative fuel and hybrid cars are showing up in droves at this year’s auto show, even though consumers are not lining-up to buy them.  Click here to see that story.

Another recent story in USA Today explains that cars have grown in sheer size over the past several decades… and logic suggests the pendulum will swing the other way sooner rather than later.  Click here to see that story.

Implications:   If you’re an auto dealer or motorcycle manufacturer, this issue could have an important impact on your company, products and services.  But what if you sell furniture or any other large, lumpy object?  All of a sudden, will more customers be in need of delivery, absent the truck, van or SUV that allows them to bring that merchandise home on their own? 

What of real estate?  If fuel stands to influence the way we drive, it certainly could influence where we live.  Rather than the suburbs or even x-urban homes which have grown so swiftly over the last several decades, might we see a renewed migration toward the city?

What about the business you’re in?

I offer not answers, but questions to consider… as the long-term effects of more expensive fuel is likely to be felt in a variety of ways.

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

There are older cars in the American driveway

Observation:   A recent story from USA Today indicates that the average age of vehicles owned by consumers in the U.S. is 10.8 years.  However, that number is based on data ending July 1, 2011, and does not reflect a very strong finish to the 2011 sales year for car dealers.  Click here to see the full story.

Implications:   As the economic recovery gains momentum (or, as the slow pace of the recovery at least demonstrates that it has the stamina to continue), consumers are likely to act on the pent-up demand that has been caused by deferring big-ticket purchases.

Throughout the recession, many consumers tried to “stretch their buying cycle.”  In effect, someone who was used to trading vehicles every three years would try hold onto their car for four; someone who was accustomed to buying a new vehicle every four or five years may have waited for five or six.

As consumers come back to the dealership, are you ready to serve them… really?  Have you considered how your consumer’s purchase priorities might have changed since the last time they went car shopping?  How do their new realities—with regard to gas prices and shifting household incomes—impact the criteria by which they will decide?  To what degree are you seeing the influence of Internet shopping—both tethered and mobile—as the consumer does research in advance (or in the middle) of their car shopping adventure?

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

Political projection 2012: A year of angst for elected officials

Observation:   Consistent followers of this site know that I try to avoid the topic of partisan politics.  But a collection of recent stories makes the topic difficult to ignore, as the collective coverage of voter satisfaction is an interesting case study for consumer sentiment and corresponding behavior.

In today’s Washington Post, there was a story about the sharp divide between those who think the Obama administration is doing a good job (click to link).  Earlier this week, the same newspaper ran a story with the headline that only “84% of Americans disapprove of the job Congress is doing” (click here to see that Washington Post story).

Last month, both the Washington Post and the New York Times ran stories about the high person incomes of members of Congress, relative to the constituents they represent.  Click here to see the Post story, and if you prefer the New York Times version, click here.

Also last month, USA Today ran a story about the general disenchantment of voters—from both parties—and the significant number of people who no longer consider themselves a member of the party they were aligned with in 2008.  Fully 2.5 million voters have left the Democratic and Republican parties since the last general election.  Click here to see that article.  

Implications:   An election year is seldom a cordial, polite thing to witness.  But with the apparent discontent of voters with regard to both the White House and Congress, as well as the candidate-driven rhetoric that is only likely to escalate as the 2012 campaign moves forward… this year is likely to be particularly messy.  

Will voters (aka consumers) be impacted by it?  Or will they simply begin to ignore it in greater numbers?  Is the move away from their political party driven by anger with the policies or ideology of that party, or the tactics their party has employed to further those platforms?  Could we be seeing a period when, politically, "the party is over?"

Based on the feedback I’ve heard—in the press and from informal interviews we’ve been doing all over the country over the past year—voters are focused on things like jobs, economic stability, deficit reduction, and income equality.  It will be interesting to see which (or whether any) candidate connects with those themes successfully. 

Does your company, product or service represent an escape from all of the election noise?  Does your messaging communicate that you understand the challenges your customers face right now, and you have ways to help?

Many consumers are focused less on the macro economy of the U.S. these days, because they realize they have little control over it (even at the voting booth).  But they have taken matters into their own hands, managing their micro-economy (their household finances) much differently than they did just a few years ago.

Are you in touch with those realities?  Does your company, product or service resonate with their new priorities?  Have you explained how… to the consumer you serve?

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

Insights about how and why to do consumer research

Observation:   Today’s Marketing Daily featured a story about consumer research, and was based on research from Cintas.   Among the findings:  How people feel about being asked for their opinion, the tendency of people to do business with those who ask their opinion, and which channels of contact are preferred for research initiatives.  Click her to see the story.

Implications:   The author of the MD story chose an unfortunate headline—even if he was only being facetious—but the article does a good job of reminding us that people appreciate being asked for input if they believe that input will be appreciated, rewarded, and acted upon.   

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

UPDATE: The competition (or collaborator) within

Observation: Adding to the story I posted yesterday (see immediately below), two more items have come to my attention on the topic of wireless and smartphone ubiquity.

First, a recent story from Online Media Daily—citing research from Motricity—estimates that roughly 38% of consumers (or nearly four in ten) made a purchase from their mobile device to purchase a gift during the most recent holiday season.  Click here to see that article.  

Today’s release from Research Brief seems to build on that momentum.  It refers to a survey of TechBargains.com users (a group the authors admit does not necessarily represent an accurate sample of consumers) which indicates that 79% of respondents used their phone to research products, 77% to compare prices, and 73% to browse stores.  Click here to see that story.

Finally, and perhaps most eye-opening, I was alerted to this study by the Centers for Disease Control, which suggests that nearly one in three homes in the U.S. (31.6%) are now wireless-only.  Additionally, even in homes where both a landline and mobile phone exist, 1 in 6 Americans received all or almost all of their calls on a wifeless telephone.  These estimates help illustrate just how ubiquitous and reliant U.S. consumers have become on their mobile devices.  Click here to see the CDC/National Health Interview Statistics page, where you can download a PDF copy of the report.

Implications:   It would be dangerous to think of the web as someplace your consumers visit only while they’re at home or sitting at a desk.  Increasingly, it is a tool that they will navigate from a small-screen device, as they physically move through all the aspects of their day.

If your website is not optimized for mobile devices, those devices become your competition.  But if your site IS responsive to smartphones and touchpads, those devices become another channel through which your customers can explore and adore your company, product or service.  (That's why I adjusted today's updated headline from the one I used yesterday!)

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

The competition within

Observation: I’ve written about consumers who do wireless price-checks on several prior occasions (see this example, “Smart phone as shopping tools,” from March, 2011), and it seems like that trend is growing.  A recent release from BIG Research indicates that more than 40% of consumers who own a smartphone have done a price-check before going ahead with a purchase, and then decided to move along and purchase from another physical location.  Click here to see the full release.

Implications:   Just because a consumer is in the store doesn’t mean they’re “in the bag.”  It might be time to review the entire customer experience of arriving, considering, and purchasing the product or service you sell.  What kinds of in-store courtesies or experiences might elevate their visit to a point where comparisons become difficult (or even impossible)?  What kinds of incentives might make them jump to purchase… faster than you can Google from your handheld device?  The competition isn't just across town; it is increasingly found in the pocket or purse of your customer.

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

Some consumers seek-out David among the online Goliaths

Observation:   A story in today’s New York Times suggests that some consumers are looking at the big e-commerce sites as the digital equivalent of Walmart... and opting to search for smaller “mom and pop” sites when it comes to online shopping.  Click here to see the story.

Implications:   The temptation for many small businesses is to try make their website look as big and sophisticated as that of their big-box retail competition.  But make sure you’re talking with your target consumer to see if that’s really what they expect of you.  In reality, they might want a digital relationship that is a bit more personal or intimate; an online version of the in-store experience you offer.  I’m not saying that either version is right or wrong.  I’m saying the best source on that topic is the people you’re selling to.

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

Angst is evident and growing between haves, have-nots

Observation:   A recent story from the New York Times over the weekend explains how class tension is growing.  Click here to see the story.

Implications:   I’m wondering whether this “class tension” will be long-term, or if it is simply the result of an increasingly heated political climate… and media coverage of the Occupy Wall Street movement that would have coincided with the time frame of this story.

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

Stressed, but coping

Observation:   An interesting story in today’s USA Today suggests that consumers are stressed, but dealing with it.  In fact, an on-going study indicates that people feel their stress levels have fallen for the first time in five years.  Click here to see the full story.

Implications:   The story does not conclusively explain why people seem more “at ease” with the stress they are under, except to hint that the economy seems to be getting a bit stronger, employment prospects seem to be increasing…

And last but not least, people have been under pressure for long enough that they’re getting used to it.  (Reconciliation strikes again.  Click here to see all of the stories we’ve offered on that topic.) 

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

Because income fuels consumption, here are some employment issues worth considering

Observation:   Today’s USA Today features an enlightening story about job prospects for 2012, including which categories and regions are most likely to hire.  Click here to see the story.

Implications:   I’m getting excited about the prospects for job growth in a lot of categories… and in regions that include those hardest hit by the real estate meltdown.

As these employment levels rise, are you monitoring the progress in your own market?  Timing is no less critical in a recovery than it was when we were headed into the recession back in 2007 and 2008.  Are you poised to speak with consumers who are seeing their spending power return?

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

Home furnishings industry regains footing... and opportunities

Observation:   A recent story in the High Point Enterprise suggests that 2011 was a year of stabilization for the home furnishings industry.  While it may not be what one could call a robust recovery, 2011 saw increases in orders, shipments and employment, and that trend seems to have momentum going forward.  Click here to see the story.  HPE is a publication serving the home furnishings industry.

Implications:   Just a few years ago, it seemed like many people were buying and selling houses they same way they would trade-in their car every few years.  But that cycle was snapped, for many consumers, by the real estate meltdown.  Upside-down in their property, in terms of equity, a lot of folks have come to accept that they won’t be moving into a new-and-improved McMansion anytime soon. 

So, like many business categories, the home furnishings industry finds its customer base in a state of reconciliation.  In effect, once people accept that a new Dream Home is not in the cards, many begin taking steps to make the house they are in the home of their dreams.  From home improvements to home furnishings and accessories, they’ll be looking for ways to be happy with their current home.  Are you speaking to this new benefit… sought by so many consumers?

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

Emotion vs. Logic: Does your customer buy based on one, the other, or both?

Observation:   One marketing cliché suggests that consumers buy with emotion, and then rationalize that purchase with logic.  But today’s IPSOS newsletter includes an important perspective on that old aphorism.  Click here to see it.

Implications:   The opposite of emotion is not logic, and the opposite of logic is not emotion.  Just because people love your product or service doesn’t mean it is irrational. 

Also important… just because a consumer might be loyal to your product or service does not mean they love it.  It could be that they just don’t want to shop for an alternative because they are completely un-interested in the category or loathe the idea of shopping in the category.  They choose a product by default, sometimes, as a means to avoid the complexity of shopping at all.

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

A little good news to end the week: Unemployment drops again

Observation:  This morning, the labor department announced that 200,000 jobs were added to the U.S. economy in December.  Click here to see the story as reported by the Washington Post a few moments ago.

Implications:   One of the goals of this blog is to amplify the optimism when good news is available.  This seemed like a high point on which to end the week.

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

QR codes should have a reason for being

Observation:  According to a story in today’s Marketing Daily, while many consumers have experimented with scanning a QR code with their smartphone, few have actually used the links to any substantial benefit.  Click here to see the story.

Implications:   Like any other messaging that can be used in the marketing process, there should be a purpose for any use of a QR Code, beyond simple novelty. 

The Quick Response codes you’ve seen on store signs, product packages and even clothing have the capacity to connecting the real world to the virtual world… and along the way, increase consumer-product engagement, deliver meaningful (helpful) product information, or even an “act now” incentive. 

Have you incorporated QR codes into your advertising or in-store promotions?  What has been your most compelling and successful use of the tactic?  Do your codes link to something that is intended to serve your company… or your consumer?

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

A new life stage term: Emerging adulthood

Observation:   During years of both advertiser analysis and in-field workshops for media companies and marketers, I’ve referred to a set of fluid life stages which help organizations anticipate consumer behaviors of the people in those groups.  Life stages make you think beyond simple age-based demographics, and focus more on the experiences that are shaping behavior during those years.  Generally speaking, the main life stages we cover are Teens (12-17), Age of Acquisition (18-34), Age of Upgrades (35-49), Age of Increased Equity (45-59), New Age Seniors (60-69), and Matures (70+).

But in the newsletter I received yesterday, Iconoculture has a new, thought-provoking life stage for all of us to consider.  It is a subset of the Age of Acquisition that they call “Emerging Adulthood” (18-25).  Click here to see the story.

Implications:   The economy, the labor market, and willing Boomer parents have colluded to create a population of young adults who are more likely to live with mom and dad for a longer period of time, rather than striking out to create their own household. 

Does that make this an unattractive market to reach for?  On the contrary, this life stage is often composed of people who are stashing-away cash until they can do it big.  In the meantime, they’re living in a place with low or no rent, so more of their income could be considered discretionary.  To be sure, some folks in this life stage and living arrangement could be examples of a “failure to launch.”  But this group also includes people who are fueling-up… so that when they leave, they can reach for the sky.

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

Never anger a reporter (and we are all reporters)

Observation:   Yesterday, I engaged one of my colleagues in an email conversation about the recent negative press surrounding Best Buy.  The conversation was sparked by this story from Forbes (click to link), which focused not only on Best Buy’s reported failure to deliver some online purchases on time during the holiday season… but also the experience of the article’s author during a recent visit to a bricks-and-mortar store.

This morning’s edition of the Research Brief newsletter offers a more widely-researched set of issues that can cause customers to become disenchanted with a service provider, whether that provider is an online entity or a physical store.  Click here to see the online version of that brief.

Implications:   These articles inspire thought about what to do when a customer service mechanism breaks down.  First, have a team of folks fix it as immediately as possible.  At the same time, take immediate ownership of the problem, and acknowledge it to those customers who are affected… in a manner that demonstrates transparency and accountability, rather than simply appropriating blame or making excuses.

If you take nothing else away from the Forbes piece, let it inspire these two pieces of cautionary advice:

1)    Make sure your site includes inventory controls that help you avoid failing to deliver online purchases within a reasonable time, and

2)   Never offend a reporter during his or her shopping experience.  (And by the way, in an age of blogging, Facebook and Twitter, we are all reporters.)

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

Research is not a game, but this gaming device is delivering research

Observation:   A story in today’s Springwise newsletter explains how Microsoft’s Kinect device is being used for in-store research about how consumers interact with products on the shelf.  Click here to see the story at Springwise.com.  To watch a video demonstration of the process on Vimeo, click use the player below.

Shopperception: tracking real world conversions like web analytics from Administrator Agile Route on Vimeo.

Implications:   As technology evolves, expect the way you can observe and serve customers to continue evolving!

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

Consumer trends for food and packaged goods

Observation:   Today’s Marketing Daily shares insights from the Hartman Group related to consumer packaged goods.  Among the notable trends they offer:  44% of adult eating happens alone (contrary to the visuals in a lot of CPG advertising).   And roughly 11% of CPG products are consumed within an hour of purchase… meaning many items are purchased and consumed spontaneously (they call it compulsively) or as a just-in-time meal or snack solution.  Click here to see the full Marketing Daily story, or to request a download of the complete report from Hartman Group, click here.

Implications:   This report helps illustrate both the spontaneous nature of today’s food shopper, and the incredible velocity at which consumers seem to be living.

For years now, we’ve been talking about how today’s food consumer is different from those of years past; today’s shopper is less likely to back the station wagon up to the supermarket and load it up with groceries for the month… and more likely to stop in on Thursday just to find a meal to serve that night when she/he gets home.

For many consumers, the supermarket is increasingly being treated like a pantry, where one stops in for what they need in the near term or to solve an immediate meal incident.   

What kinds of changes are you seeing in the way people buy in your category?  Has your company, product or service adjusted to those shifts?  Has your messaging?

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

Consumer to remain cautious for the foreseeable future

Observation:   The premise of Elm Street Economics is to avoid the collective noise that tends to come out of Wall Street or Washington, and refocus on what your consumers are trying to tell you.  To that end, a great story from yesterday’s New York Times takes a consumer-point-of-view in helping us understand the current situation faced by many folks, and the behaviors we might therefore anticipate.  Click here to see the full story.

Implications:   This story seems to suggest that consumers are not going to single-handedly pull us into a robust recovery, at least not in the next few months.  They remain cautious and careful; reconciled to spending in a way that matches their current financial realities. 

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

Trade-in value: It's not just for cars anymore

Observation:   Back in October, we shared a posting about “Re-commerce,” where more consumers are trying to sell something they own before buying the replacement for that item (i.e., listing a couch on Craig’s List before spending the money for a new sofa).  Click here to see that Elm Street consumer trends story from October 4, which was based on an article from Trendwatching.com.

In today’s Marketing Daily, there is another story of interest to this trend.  It suggests that more women are considering resale value before they buy a product (and we’re talking about everything from clothing to electronics, no just cars).  Click here to see that story.

76% of the women surveyed indicate that they participate in a site where consumers buy or sell from each other.

Implications:   Should your company consider adding a trade-in policy for the products you sell?  Should it at least start thinking about the long-term resale value of the products you offer, and talking about those attributes with customers?

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

2012: A year of (continuing) empowerment?

Observation:   Because the intent of this site is to share consumer trends, I typically avoid offering forecasts or predictions.  I consider myself a trend watcher, not a futurist.    But that having been said, one collection of trends—when considered as a whole—seems to have gained enough momentum that I could safely suggest we’ll see more of it and in more variations than ever before:  Consumer Control.

Holiday spending through online and mobile site channels out-performed all other sales growth, and by a significant margin.  Digital devices helped consumers find the best deals, while reducing the time required to shop for those items. 

Reconciliation—changing one’s household financial management—is another example of taking (or regaining) control.  For more on the topic, see “The reconciliation of 2011,” posted 1/2/12 (earlier today).   Over the past two or three years, many consumers have paid-down some of their consumer debt over the past few years and reduced their overall spending so as to enjoy more discretionary income (discretion = control). 

A recent New York Times article suggests that younger women are leaving the ranks of the unemployed… to re-enter the classroom (click here to see that story).    Lots of people are setting-up shop at Me, Incorporated; starting their own company or working as independent contractors after having difficulty finding a good job in their career field.  Either of these alternatives are good examples of consumers asserting greater control, in this case, in the way they buy into the job market (or lack of one). 

While the efforts have been somewhat less visible with the onset of winter weather in northern parts of the U.S., the Occupy Wall Street movement might be yet another example of consumers trying to assert greater control… over a system that they perceive to be broken or a financial landscape that they do not see as fair and equitable.  One might even argue that the roots of this empowerment reach all the way back to the Arab Spring of 2011, when thousands of people decided to wrestle control over their destiny away from a dictator or regime, from Tunisia through Egypt, Libya and beyond.  (If people on the other side of the world are prepared to protest even under a hail of gunfire, setting up a pup tent in a park just doesn’t seem all that difficult.) 

 

Implications:   Once consumers have had a taste of control, it is unlikely they’ll decide they want less of it… unless relinquishing that control results in a major convenience gained or a major stress lost. 

How is your company, product or service sharing control over the purchase experience with the customers who buy it?  Do you offer a digital channel for them to do research or even buy through?  How about mobile?  How can you offer appreciated choices/control that your competitors do not or cannot?


Certainly, this is not the first time I've written on the topic of Consumer Control; indeed, more than 100 stories in the Elm Street Economics consumer trends blog contain a reference to the issue (click here to see the category).  But 2012 stands to be a year where Consumer Control becomes more and more conspicuous, to more and more companies and categories.

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

Political discontent

Observation:   Before you read this, note that I’m focusing on the political race purely for its’ consumer trend value, not because I want to talk politics.

A seemingly constant stream of different GOP candidates have taken their turn at “leading in the polls,” including everyone from Michele Bachmann to Rick Perry, and then from Herman Cain to Newt Gingrich.   At this writing, this week’s initial primary in Iowa now seems to be somewhat of a toss-up between Mitt Romney, Ron Paul, and most recent surge candidate Rick Santorum.   

Now—politics aside—think about that.  Without considering the platform of any candidate or any scandal that might surround their candidacy, think simply about the churn of the race.  It is as if voters (aka Consumers) are finding favor with a fresh face, and then holding that candidate up for greater scrutiny, until scratches or dents are found, and they decide to move onto the next option.

We seem to be living through a season of political discontent… where the electorate is searching for a candidate they can live with (sometimes, by trial and error, it seems).  And it might be worth noting that the person they’re comfortable with today may not be the candidate they’ll prefer tomorrow, next week or next month.  The winner will be that candidate who peaks at just the right time… as voters arrive at their caucuses or walk into a voting booth.

Implications:   How long does your company, product or service have to establish itself as contender?  (How long is the buying cycle or consideration process for the products or services you sell?)  How could your messaging be time to make sure that you’re a strong contender when it matters most… when the consumer is ready to buy or commit?

As many campaign managers could tell you this year, being an incumbent might not necessarily be an advantage.  Have you talked with your constituents (aka “Best Customers”), lately, to see if you’re really earning their continued business?  (The alternative would be consumers who buy from an under-performing provider simply because it’s easier than shopping around… for the moment.) 

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