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Sep262012

October 1996 - TRENDS CHANGE MARKETING CLIMATE

An oldie but a goodie! - October 1996

I was right on several of the trends below: my first such article. This later became and is currently an annual client letter. Some trends take a while to kick in. The middleman reduction was starting in 1996 and continues to this day; the Internet the main reason but fast delivery is still a factor. I wrote of this trend extensively in my book to be released this fall. 

Boomers are still hanging around, but despite press saying were washed up, we still wield most of the buying power, and will for some time. 

Where did Faith Popcorn go? Don't hear much from her lately, but she does have an active Twitter account. Might have missed the boat on the Cocooning trend. Fantasy and Adventure continue to grow especially in the gaming world. 

Fun. 

Burgess Releases First Annual Trends’ List 1996

by Ron Burgess

Once a year, I schedule a few days in the Fall to review important articles and studies that I have saved throughout the prior year.  I compare these published trends to the changes and trends I see occurring within my clientele.   Comparing the statistics with the projects we are currently pursuing is the beginning phase of preparing for year-end marketing planning, in anticipation of the coming year.

This year I decided to categorize the important issues, identifying them as trends that are important to marketing.  I thought I would share them with you.  Included, are the observations of several companies and marketers.

“The middle is being cut out” 

Wholesalers and middlemen have been in a tight squeeze since the early 80’s when delivery companies (UPS and FEDEX) changed the shipping industry, reducing the need for local warehouses and delivery systems.  Long distance phone rates have become so economical that using the phone has currently displaced the need to deal with local retailers, agencies, and services.  In some market niches, the Internet is reducing the need for retailers, catalogues, even the mail.  New ways to add more value to distribution or packaging must be developed in order for middlemen to maintain a viable position.

Baby Boomers take over the world” 

The Baby Boomer market has been exhausted to the point of  “attention saturation.”   However, the economic reality is that the spending power of this group, which represents one-fourth of the entire population entering their peak earning years, is tremendous. This market is too large for the business community to ignore.

Some trend forecasters simplify the trends they see; they generalize,  forgetting that an entire population does not participate in particular trends. Different segments of society determine different trends.   In fact, most trends are started by certain types of people based on their attitudes.  Boomers heavily effect all current trends, based on their participation or non-participation.  For this reason, marketers must not eliminate the Boomers as a critical element in the process of accurately identifying marketing trends.

The spending pattern of Baby Boomers is not the same as that of previous generations.  To be specific,  the forty year-olds of today do not spend money the same way that this same age group did ten years ago.  Already, the high income Boomers have rejected poorly built cars, as well as high-end clothing stores; they have changed the auto industry and forced dozens of elite stores out of business.

As the most highly educated group in history (25% of forty-seven year-olds have a college degree, while 50% attended college), Boomers share the belief that making the best purchasing decision first requires massive research and mounds of information.   While Boomers will spend on many things, they also want to know they have not been duped into paying more than necessary for a product or service.  This is a unique group that cannot be sold the same way as previous or following generations.

The Cocooning trend: retreating from the world

Boomers may be leading another trend: retreating.  Faith Popcorn identifies this movement as Cocooning, and Cashing Out in her attitude breaking book,  The Popcorn Report

Cocooning is a trend that can be substantiated through retail sales reports. Cocooning is retreating into the safety of the home; building a nest surrounded with comforts tailored to one’s individual tastes.   Evidence of this trend can be seen by the fact that fashion stores are flat in sales,  yet home furnishing stores are experiencing rapid growth. 

Cashing Out embraces the less is more philosophy.  This is a trend to reduce personal expenses dramatically by selling cars and expensive homes in favor of a more “downsized” lifestyle.  In some cases, this accompanies a move from urban and suburban to rural living.

Technological Change

Technological change continues to have a huge impact on marketing and communications.  The desk top marketing revolution is just around the corner.  Companies are turning to in-house database marketing as a way to control niche marketing efforts.  

Business communications are undergoing a fundamental change.  With thousands of companies already linked via the Internet and Electronic data transfer, millions of employees are already doing business with a computer. 

This is not a pie in the sky prediction; 49% of the companies on the Net say they already use it for purchasing from vendors.  Another 16% will add these features this year.  Companies are routinely transferring files with each other as well as with strategic partners. 

Internet software providers have just begun to release voice messaging services and simple video viewing capabilities.  A few companies now offer phone and video transfer, allowing traditional phone conversations to be done over the Internet without long distance charges.  This is just one type of incentive needed for businesses to embrace these new technologies.  Working on the same document across the country or the  world has become a reality. 

Fantasy and Adventure Trend

Two kinds of adventure are appealing to under 50.  The first kind of adventure is like the experiential adventure brought to us by Walt Disney.  He created an expectation in the children of the ‘50’s.  Disney’s form of adventure had the lure of high expectation for entertainment,  combined with impeccable quality.  This type of fantasy adventure first became rooted into the children of the ‘80’s  and ‘90’s by the introduction of video games by  Nintendo.

People reflecting this trend find their desires met through real adventures that can include experiential-travel experiences such as climbing world class mountains, or visiting archeological digs.  This form of travel can also be experienced through virtual reality games within the safety of a controlled environment.  One trend can be capitalized on; the other is more homebound and reclusive by nature.

Properly understood, the five current trends mentioned above: the cutting out the middle, Boomer influence, Cocooning/Cashing OutTechnical Advances, and the search to fill leisure time with high quality fantasy and adventure, become a road map in the your marketing hands! 

Join me Fall of 1996 in reviewing your current marketing approach and strategies in light of the current climate.  Trend-mapping is valuable only when your response makes a difference in your company!