Surgeon and hotel collaborate for a package of nip, tuck, and tuck you in

Observation:  Today’s Springwise newsletter included a story about a plastic surgeon in New York that has partnered with a luxury hotel where patients can stay during recovery from their procedure.  Click here to see the story at Springwise.com.

Implications:   This story is a great example of focusing not on the practice (business), but on the patient (consumer).

Who could you partner with to build a package that is bigger than either of the companies, products or services involved?  Don’t start by thinking of your existing business contacts.  Start by thinking about your patient—er, customer—experience.  Ask what could make that experience (before, during and after) even better.  Think outside your company’s walls.  Then make the contacts to make it happen.

By the way… talk to your media and marketing vendors to see if they might be a source of some very smart partnerships.  After all, they’re talking to all kinds of business people every week!

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

Frugality fatigue drives some consumers to trade-up

Observation:   A recent story from Bloomberg suggests that consumers have had enough fiscal conservative, and they’re ready to indulge a little bit more.  The story cites research from Britt Beemer’s America’s Research Group and other sources… and you can click here to see it.

Implications:   This article correctly points out that, for most people alive today, the past four to five years have been the longest period of fiscal restraint they have ever had to place on their family budget.  While the recovery seems a bit drawn out and perhaps even still “at risk” on some fronts, some folks have had enough.  They’re ready to choose the car with a few more options, the entrée that is not on the discount menu, or the mobile phone that’s just a little bit smarter with more options.

Does your company offer a more upscale alternative?  Have you placed that product or service in a higher profile position, lately, and invited the consumer to indulge?  After all, it’s been too long… and some customers might be ready to see and hear the kind of messaging that moves them back to their favorites (instead of the cheaper alternatives they’ve been settling for over the past few years).

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

Targeting the mass affluent

Observation:   A story from yesterday’s New York Times explains how some financial institutions have turned their attention to consumers who seem to be doing well, but may not fit the description of super-rich.  Click here to see the story.

Implications:   In our on-location “Consumer DNA” workshops, we often use qualitative research to demonstrate that there are far more “emerging investors” available to most business communities than there are “blue chip investors.”  The latter group is composed of people with at least a six figure income who pay for the counsel of a financial planner, accountant or stock broker; the former group—the emerging set—is composed of people with an above-average income but who are NOT receiving the guidance of a paid professional.

Everyone wants to sell stuff to rich people.  But opportunities exist when you reach for the folks who are not quite rich, but might be on their way.

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

Automakers introduce “Gateways to Luxury”

Observation:   An article from USA Today explains how luxury automakers are moving down-market, hoping to lure younger, perhaps less affluent consumers into the upscale car market a little bit sooner… and more gradually.  Click here to see the story.

Implications:   “Luxury brand owners tend to be more loyal,” and therefore, it’s important to “Capture, Land and Expand.”  What a great series of thoughts from people who work in the upscale car market.  Gain attention the market share you hope to (capture) and develop over the next few years, sell (land) them, and then grow (expand) the relationship.

Makes perfect sense to me, provide there are entry-level luxury vehicles worth buying, and provided there are enough buyers to go around in what appears to be an increasingly crowded space.

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

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: 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.  

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.

Ads offering cars as a gift idea seem to miss the mark. (Or do they?)

Observation:  According to a recent story from Marketing Daily, few consumers are wooed by those campaigns that suggest a vehicle would make a great Christmas gift.  Click here to see the story.

Implications:   What the study does not adequately acknowledge is that Lexus is not after “most consumers” when they run a commercial suggesting their upscale cars would make a great gift idea.  They’re targeting folks for whom the idea does not seem over-the-top.

Personally, I don’t see myself buying anyone a car for Christmas.  But in this case, I’m not the target.

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

New or used: Some consumers upgrade to older but nicer cars

Observation:  A story from today’s Marketing Daily suggests that more consumers are opting to buy a pre-owned vehicle with nicer features, rather than buying a more base-model new car.  Click here to see the story.

Implications:   In reconciling what value means in a post-recession economy, it appears that consumers are getting creating about how they can enjoy the finer things.  Does your company, product or service appeal to that sentiment?

Does your marketing/messaging?

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

Signs of reconciliation continue... and that doesn't always mean "cutting back"

Observation:  A pair of recent stories from Marketing Daily serves as an illustration that while some people might be continuing their more pragmatic spending style, others have moved on.  First, there was an article about lowering expectations at Tiffany’s… which sources loosely attribute to the Occupy Wall Street movement (I personally think that might be a stretch, but the idea of being more conservative is easy to believe).  Click here to see that story.

Another posting explains how the use of private-label (aka store branded) credit cards is down.  Click here to see that story.  But not everyone is "cutting back."  

Implications:   Our description of the current consumer climate as “a period of reconciliation” seems to be more appropriate with each passing week… as families acclimate their spending behaviors to the new set of realities they have been dealt in the post-recession era.


That doesn't mean they've stopped spending.  Some families might be deciding that things have calmed-down enough that they can get back to the task of living.  This story from Marketing Daily suggests that some consumers are getting BACK to indulging on luxury brands, particularly where automotive is concerned.  (Click to link.)

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

The impact of global supply and demand on local consumers

A Media Post blog titled Engage:  Affluent gives us another category to consider when it comes to the issue of global supply and demand.  Today’s posting suggests that couples in China are joining the world market for diamonds.  Click here to see the post.

Implications:  For quite some time now, I’ve been pointing-out the impact of expanding economies in China and India as forces that will put pressure on the worlds supply of oil, various food commodities and more.  But as the middle- and upper-income population grows, we’ll feel the effect in a lot of product categories.

Have you seen it in your product category?  Does it influence the price you can offer consumers?  Have you thought about ways of placing more focus on the experience or appeal of your product or service… and shifting to a focus on the way you enhance the consumer’s life?

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.

Affluent consumers feeling more optimistic

Citing research from Ipsos Mendelsohn, confidence among upscale consumers is on the rise, according to a briefing by Marketing Daily earlier this week.  Click here to see the story.

Implications:  I am seeing/hearing a campaign that starts out, “Okay, you’ve demonstrated great personal restraint as we’ve come through a tumultuous time… but now, it’s time to reward yourself…”

Does your product or service represent that kind of long-awaited, well-deserved reward?  Or… does your brand represent the kind of extreme value that lets the consumer fund that treat (with all the money they saved)?

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

The chasm between affluent and average consumers continues to widen

Friend and colleague Jim Hopes sent me an article that appeared in this morning’s Advertising Age.  It had to do with the growing distance between higher income consumers… and everyone else.  Click here to see the story. 

Implications:  Since the recession began—even through the current recovery—a core tenet of Elm Street Economics is that “The target consumer you serve today might be somewhat or completely different from the target consumer you served in 2006; and even if you have the same target consumers, those people may have vastly different needs or purchasing priorities.”

The Ad Age article helps illustrate why that is the case.

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

Some companies let their marketing grow a little older

A recent New York Times story featured examples of companies that have begun to target older consumers.  Click here to see the full article.

Implications:  The Baby Boom generation has been a favorite target for many marketers since the day were born.  Now, as they head through midlife and into their 60’s, this cohort of consumers will continue to receive attention.  But beware the term “upper demo.”  Because today’s 55+ consumers look very little like their parents or grandparents did at a similar age. 

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

Restaurant recovery proceeds slowly

Roughly 24% of adults came through the recession relatively unscathed… but the rest are still being very careful about spending their out-of-home dining dollars, according to a story that appeared today in Marketing Daily.   Citing research from NPD Group, the article indicates that a recovery is definitely underway in the restaurant category, but that consumers who are working with lower household incomes or rebuilding wealth are dining out less frequently, trading-down in terms of restaurant type, or even ordering fewer items.  (Click to link.)

Implications:  This article—and the restaurant category—provide a great example of how some attitudes and behaviors learned in response to the recent recession could linger for quite some time.  Many consumers were simply on “auto-pilot” when it came to spending decisions (or non-decisions); now, spending seems to be much more thoughtful and deliberate.

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

"Me, too!" versus iPad: Why Apple wins.

Former colleague and continuing friend Todd Storch sent me this story from The Business Insider (click to link).  It offers some great thinking about why, even in a stressed economy, so many people will pay a premium for Apple’s original.

Implications:   The iPad is not just a device, it is also a facilitator.  It helps the user accomplish… catching up on the news, playing a game, reading a book, using an app.  And contrary to popular convention, it does it without adding more bells and whistles; their current campaign explains that the iPad is what happens “when technology gets out of the way.”  (See their current ad in the video box below.)

Could your company benefit from some innovation?  Instead of thinking about what to add, ask whether your offering might be improved by taking something away.  Being intuitive—anticipating what the consumer wants—is the path to profitable innovation.  And it’s what can keep any company, product or service from being seen as a commodity.

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

Are restaurants and clubs still competing with at-home alternatives?

There was a story in today’s Marketing Daily worth reading, especially if you run a restaurant, nightclub, or other out-of-home entertainment venue.  (Or, if you sell home electronics, home furnishings, catering, or upscale food that is prepared at home.)  The article suggests that people are still spending time and money on home entertaining… and that such spending might even be going up.  Click here to read the story.

Implications:   Some people will go back to restaurants and nightclubs as they exit their personal recession.  Others might take this opportunity to “upgrade” their experience by spending more in at-home entertainment… not less.  And still others might fit somewhere between, going out more than they did two years ago, but not as much as they may have five years ago.

If you sell higher-end home entertainment goods, from electronics and furniture to alcohol and food… you could benefit from this shift in lifestyles.  If you sell out-of-home entertainment or dining experiences, you might need to address the convenience and full-feature aspect of your offering.

I am reminded that your competition is not always your only competition.

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

New attitudes toward generosity and gifting

My wife recently encouraged me to buy an expensive D-SLR camera, to replace one that I had irreparably damaged on a kayak trip last fall. I agreed, under the condition that she might go easy on my birthday and Christmas gifts this year (the camera would do the job).

Not long after that, I encouraged my wife to purchase a painting that she fell in love with while we were on vacation. She consented, under the condition that the trip and the painting would be considered her holiday present.

I thought that our behavior might be unique, but within an article in Saturday’s New York Times I found evidence that we might simply be part of a growing trend… where gifting has moved toward giving someone permission to spend on a themselves, to fulfill an expensive hobby or passion. It was a fascinating story, and you can read it by clicking here.

Implications: The great recession taught us to avoid waste. The trend that his hinted at by this story takes the pressure—and the risk of potential waste—off of those who toil and stew about what the perfect gift might be for someone they love. Instead of trying to be mind-readers—knowing what the absolute perfect give might be—we are becoming facilitators… encouraging our spouse or significant other to fulfill a dream or desire (and not feel guilty about it).

Is your product or service too complex for someone to give as a gift? (Julie may have been intimidated to know what kind of lens capability, speed, storage and connectivity I would look for in a camera… and I don’t have a clue when it comes to choosing a painting or any other decorative decision.) Perhaps the solution is not to market your product or service as a gift that someone gives, but as a dream to be encouraged.

In this scenario, I can imagine a whole new range of things (aspirations) that begin to compete for the gift dollar. Travel? Higher education? Anything which, purchased for oneself, might feel selfish… but when purchased with the encouragement of a loved one, could be the most generous gift of all.

PS: It’s Valentine’s Day. Still need a great, last-minute gift idea?

[Note: For a counter trend to this posting, see the story that follows—Financial Infidelity—immediately above.]

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

Internet use is often evidence of higher income

A Research Brief published about two hours ago suggests that people with higher incomes are more likely to be consistent users of the Internet. (Click here to see the full story.)

Implications: Once upon a time (and it wasn’t that long ago), the Internet was a great way to reach a niche group. As we move into 2011, the Internet audience is more aptly described as mainstream, if not upscale.

Does your site look like a portal waiting to serve a niche… or an additional front door to your business? Do you have just one site? Should your company have more than one site—a number of micro-sites, perhaps—that super-serve it the wide variety of niche markets which comprise that market we call, “the mainstream?”

Mike Anderson