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.