Here’s a summary of my observations from a keynote I did in New York City for retailers, agencies, marketing organizations, food and CPG companies, on some of the trends that are sweeping their industries today.
1. The New Consumer Is Shifting Their Attention Faster than Ever
Consumers suffer from “continuous partial attention” with more stimuli around them than ever before:
- The number of text messages sent each day exceeds the population of the earth
- There are 62.6 million videogame households (up 11.4%) and the average age of a video game consumer is 41
- consumers spend about 10 hours per day and $1,000 per year with various media – primarily wireless devices, iPods, in store displays, in-auto media content and the Internet
- 93% of American teens are online, proving that the Internet will become ubiquitous
Consumers across demographic segments are immersed in this new interactive world forcing brands to engage them across all mediums to stay connected.
This new shopper is not only more scattered and more connected, but also faster – scanning 12 feet of shelf space on average per second. In-store influencers will now evolve at the pace of the iPhone and the Blackberry, challenging marketers to keep up with the pace. Faster is the new innovation and innovation isn’t just about new product design – it’s about responding to fast-paced consumer change.
Marketing Implication: Marketers must work harder than ever to capture the attention of the consumer and make a connection. Brands must keep up with the pace of consumer change in order to stay relevant.
2. The New Consumer Is No Longer Nuclear
The nuclear family is no longer the norm as Americans find new definitions for ‘family’ in today’s world. The following headlines touch on the variety of different ways families are structured today:
- “….only 1 in 4 of the population live in heterosexual, two-parent families… one in three people now live alone….” – ABC
- “….urban Americans remain single for more than half of their adult lives, a radical shift…..” – NBC
- “Between the ages of 18 and 59…. Chicagoans spend… 18 years married.. 4 years co-habitating….19 years alone or casually dating” – Associated Press
- “LAT tourism …. living apart together ….two out of five marriages end in divorce” – Reuters
Brands must acknowledge these new trends as they develop products and create marketing messages to resonate with today’s consumer.
Marketing Implication: Hyper-nicheing is the new brand reality as the market becomes more specialized and fragmented. Marketers can no longer rely on preconceived segmentation strategies, but rather need to think differently about who they are trying to reach and how to reach them.
3. The New Consumer Is Influenced Differently
We’re in the era of the “Celebrity Baby Blog” where purchases are influenced heavily by what others are doing. And it is not just celebrities that consumers are watching – they are also looking to their peers for advice and brand recommendations. For example, in travel, 79% of travellers trust peer reviews more than ads.
The same thing is happening with consumer products – peer reviews are the new influencers, with 83% trusting the opinion of a friend or acquaintance who has used the product or service.
Marketing Implication: Social networks are the new brand influencers and marketers must find ways to connect with consumers who are highly influential in their peer groups.
4. The New Consumer Is Shifting Their Focus
Socio-economic shifts are affecting consumer behavior at an increasingly fast pace.
For example, the downturn in the economy has quickly had a significant impact on consumers’ eating habits. 71% of consumers are choosing to prepare meals at home instead of eating out and restaurant trips have decreased from 1.5 times a week in 2006, to 1.2 times today. (Food Marketing Institute US Grocery Shopper Trends)
Another prime example of trends reaching mainstream quickly is the health trend. Even the most active consumers shopping at delis are health-conscious. 80% of deli-buyers are making changes to their diets and 90% are now reading deli labels (International Dairy-Deli-Bakery Association)
New markets are constantly emerging, whether it’s fresh-cut snack food, growing from a $6.8 billion industry to $10.5 billion (International Fresh-Cut Produce Association) or rapidly changing tastes – flavors are now moving from upscale kitchens to chain restaurants in 12 months, compared to 36 months 5 years ago.
Marketing Implication: Faster-paced preference change is the new reality and brands must be nimble to keep up with consumer demand.
5. The New Product Is Rapidly Redefined
New products are brought to market faster, redefining the industry quickly and forcing products to keep up.
As scientific knowledge is being shared in real time, ethical packaging innovations are emerging and driving product design.
For example, wax paper infused with cinnamon oil (antibacterial) inhibits 96% of mold for up to 10 days (Investor’s Business Daily). This new discovery allows CPG companies to produce new products with a naturally longer shelf life. Major manufacturers and retailers must respond to these new trends, especially as consumers jump onboard and demand these innovations. Most notably, Walmart has vowed to have zero private label packaging waste by 2010, and to eliminate all packaging waste by 2025 (Modern Plastics Worldwide)
Another example of a new product being redefined at a rapid pace is the “nutri-cosmetic” market – already at $1.5 billion worldwide (only 3% of that is in the U.S.) and predicted to grow at 4.7% a year in the U.S. to $10.6 billion by 2012 (Household & Personal Products Industry). Consumers are embracing new products that can offer positive effects on their appearance, while easily being integrated into their lifestyle.
Marketing Implication: Time to market and corporate agility are the new capabilities to focus on.
6. The New Product Is Upside Down
The way companies are innovating is also changing. The process used to be to get the assortment right, figure out the merchandising, go to stores and create a marketing campaign around it all.
The new innovation model turns that upside down: as large companies are more connected to consumer demand, they can use that insight to come up with the marketing, then determine the merchandising and get the assortment right.
Partnership with retailers and packaging companies in the design of the product is the key trend because these partners are closer to consumer demands and can often guide development of new products through their unique insight. Smart manufacturers are turning to packaging designers to ask for help lowering expenses as oil and raw material prices rise. (Bangkok Post). 73% of packaging machine builders collaborate with customer-packaging engineers. (Control Engineering).
Marketing Implication: Partnership with retailers and packaging companies is the key method to speed up product innovation and efficiently introduce new products to the marketplace.
7. The New Marketing Is Shifting
Consumers are being increasingly influenced by their time spent online. Therefore, online advertising spending is increasing and is predicted to rise to $51 billion in 2012 – up from $21 billion in 2007.
Consumers are looking across all media and being influenced by different sources of inspiration. Different media serves different purposes for consumers and reaches them in different mindsets. For example, certain magazines are set aside for leisure comfort reading, while online media can quickly provide relevant information at the touch of a button.
Marketing Implication: A “healthy mix” is the new advertising recipe for success reaching consumers at different touch-points.
Here’s a short video clip of Jim’s keynote, in which he speaks about the increasing velocity of change in retail.