Trend forecasts crucial in crisis
In today's world consumers are exposed to new technologies, products, services and experiences faster than ever before.
In order to stay in business, especially in these days of economic recession when consumers are cutting back on spending, companies need to know what consumer trends are going to dominate in the coming year as this will help them devise strategies, plan products and serve the consumer better.
Emirates Business spoke to experts to find out the importance of trend-watching for businesses in the current economic scenario and the top consumer trends that will dominate 2009.
Reinier Evers, founder, Trendwatching.com, said: "While companies worldwide do have information about their customers, it does not necessarily translate into knowledge about what consumers want. This is where market research and information about the trends that are going to dominate comes in handy as it helps firms set their business strategy, and come out with innovative ideas and services. It helps to keep one's ear to the ground in today's competitive environment."
Sevil Ermin, Managing Director, Nielsen, UAE said: "For any business, forecasting trends becomes more crucial than ever under the current economic scenario. When budgets are tight, business leaders will have to continuously measure and optimise their marketing spending. This will give them the flexibility to be agile, renew their forecasts and business plans when market conditions are changing everyday and bringing in new challenges.
"At times of slowdown, we can see a change in the consumer-spending pattern. We observe that consumers reallocate their spendings according to hierarchy of needs. High priority categories like, food, healthcare and education are the ones which consumers would like to maintain their spending levels. Household cleaning and personal care, electronics, furniture and clothing are medium priority categories, where we see reduced consumption and switches to value brands during slowdown. Automobiles and apartments are the lowest priority categories, where consumers either stop or postpone their purchases."
Evers agreed: "Obviously, for 2009, it will be all about the recession, and consumers finding new ways to save money, ditching those purchases that they feel they can do without if they have to. "There has never been a better time to show you truly care about your customers: they will definitely not forget any kind of generosity you show them in these challenging times." Here are some of the key consumer trends for 2009.
Nichetributes is about making products and services relevant by incorporating 'attributes' and features that cater to consumer lifestyles and situations.
Nichetributes are attributes and additions to existing products, making them more practical for specific user groups, while at the same time signalling to those users that the brand cares and even pays tribute to their lifestyle.
For consumers, anything practical and useful will go down well in these austere times, while anything that shows that a brand cares about its customers' interests will be reciprocated with appreciation and goodwill. Which in today's harsh business climate is like gold dust. For businesses, nichetributes can often be imagined and introduced at very low costs. The only resources needed are creativity. A good example of nichetributes is Estée Lauder that developed its 'Super Flight Creme Continuous Hydration for Face and for Eyes' for frequent flyers, helping them improve their skin's recovery from dry cabin air and jet lag.
In 2009, the consumer decides what constitutes luxury. Luxury will be whatever the consumer want it to be. So in the next 12 months, instead of worrying about missing out on the next big thing in luxury, focus on defining it. Declare that the end is nigh for anything that is getting a little too affordable, too accessible, or just too well-known. Then introduce something very different (if not the opposite), appealing to the in-crowds ready to jump ship anyway.
Want something to play with? How about Discreet-chic? Recession-chic? Frugality-chic? Understated-chic? Or anything that is commissioned? Access? Secrets? Stories? Bespoke? Knowledge? Skills? Health? Etiquette? Or a mix of any of these? Whatever angle you may go for, luxury in this new year will comprise much, much more than ostentatiously flaunting wealth. Find the right (status) trigger for the right audience, then coin it and build on it. This one is all yours. Downturn or upturn.
Transparency was big in 2007, bigger in 2008, and even bigger this year. Feedback 3.0, which is one of the trends-within-a-trend, is starting to make waves. Feedback 1.0 (one of those early web phenomena) saw outraged individuals posting scathing reviews, feedback and complaints on the net. Brands remained unaware or chose not to listen, dismissing these outbursts the way they had dismissed any kind of customer dissatisfaction for decades. Feedback 2.0 (which we are in right now) is about these rants having gone 'mass.' Conversation is finally taking place, but unfortunately among consumers and not between corporations and consumers. Companies have started to take note, but to a large degree still choose to listen, not talk back, trying to 'learn' from the for-all-to-see review revolution.
Feedback 3.0 (which is building as we speak) will be all about companies joining the conversation, if only to get their side of the story in front of the mass audience that now scans reviews. Expect smart companies to be increasingly able (and to increasingly demand) to post their apologies and solutions, preferably directly alongside reviews from unhappy customers. An example of Feeedback 3.0 in action are sites like Dell Ideastorm and My Starbucks Idea, where anyone can post suggestions, with Dell and Starbucks actually replying for all to see.
Whatever you do this year, don't wait until bad times really come knocking to kick-start feedback 3.0.
No, there will be no 'eco fatigue' in 2009. While Eco-embedded and Eco-iconic trends are now firmly in place, here is one more for this year. Econcierges are firms and services dedicated to helping households go green in any possible way. And while any advice that reduces a household's (harmful) consumption is beneficial enough, the fact that such advice leads to savings makes this a very 2009 development. In the coming 12 months, count on cash-strapped consumers to embrace sustainability with a vengeance, but first and foremost for monetary reasons. A good example is eco:drive, a new Fiat-branded widget which aims to improve driving efficiency by up to 15 per cent. This means a smaller carbon footprint at the same time as saving on fuel. The widget can be transferred onto a USB stick and plugged into Fiat's Blue&Me technology (which features a USB port on the car's dashboard). The software then evaluates driving and gives a mark out of 100. Tutorials subsequently encourage drivers to improve their driving, their score and ultimately, reduce their carbon emissions.
Figure out which econcierge services you could offer your customers, or which of the new players out there you should be partnering with. Helping your customers save money by helping the environment has never been a more tantalising proposition.
As the Googles, Nokias (who expect half of their handsets to be GPS enabled by 2010-2012), Apples and MapQuests of this world continue to build the necessary infrastructure and devices any consumer-focused brand would be stupid not to be partnering or experimenting with map-based services. Why? Geography is about everything that is (literally) close to consumers, and it is a universally familiar method of organising, finding and tracking relevant information on objects, events and people. And now that superior geographical information is accessible on-the-go, from in-car navigation to iPhones, the sky is the limit. Where to start? First, see what is new on Google Maps, Yahoo's FireEagle and Nokia Maps. Then check out the numerous smaller – yet very B2C – sites and 'mapplets'. Add to that the still-early shift from 'flat maps' to digital 3D representations of the real world and an ongoing push to tag anything and everything, and it is safe to say that you are not too late to make the most of Mapmania.
The umbrella trend for the next 12 months is happy ending. 2009 is an excellent year for those businesses keen on showing consumers that they really care. Offering respect and relevance (Nichetributes), listening to real-time needs and wants (Feedback 3.0), helping people to save money while being green (Econcierge): all of this will not be forgotten by consumers that are currently feeling the heat. But the most important side effect of more austere times is probably that consumers start questioning what truly makes them happy, which more often than not steers them towards the realisation that happiness is not (just) about traditional consumption. Expect pockets of consumers to switch to lower-consumption models with surprising ease, and to look for different and less costly sources of happiness and thus, ultimately, status. Any way you can help them with that will be a guaranteed winner.
To apply these trends, businesses need to ask themselves if they have the potential to do the following:
- Influence or shape your company's vision
- Inspire you to come up with a new business concept, an entirely new venture, a new brand
- Add a new product, service or experience for a certain customer segment
- Speak the language of those consumers 'living' a trend
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