DECEMBER 12, 2011

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Industry Viewpoints
Forecasting The Top Consumer & Marketing Trends for 2012
TrendWatching.com, a company that specializes in identifying consumer insights, has released their Top 12 Consumer Trends for 2012 list. While the report focuses on global trends, CNTelligence will highlight some of the more important ones for the US. • DIY Health: Consumers are increasingly reliant on technology to manage their lives, and health is no exception. The Apple app store currently has 9,000 health apps, but that number is expected to grow to 13,000 in the next few months. One of the most innovative DIY Health technologies is Jawbone’s Up. Jawbone’s Up is a wristband that tracks a user’s movement, eating and sleeping patterns. The device can transfer data to an iPhone app to record their activity. It also vibrates when the user has been inactive for a period. • Eco-Cycology: Eco-cycology is the practice of brands taking back their product after it’s been used and recycling it. While consumers have been slow to spend more money on ‘green’ products during the time of the recession, this practice can help them feel that they are still helping protect the environment. Some notable examples include Patagonia and Nike. Patagonia has recycled 45 tons of old clothing into 34 tons of new clothing. Nike is grinding up old shoes and using them to create new surfaces for playgrounds. • Cashless: While 2012 will not be the year when people give up cash, it will be the year when some major players roll-out cashless technologies beyond credit/debit cards. Most of these technologies rely on near-field communications, or an interaction between two devices that are near one another. This allows for the exchange of data (and money) between the two. Google Wallet and MasterCard’s Masterpass are two prime examples.
So what? The pace of innovation and changes in consumer habits continues to accelerate. While some of the trends listed here will turn out to be duds, it’s important for marketers and publishers to consider what’s next in order to stay ahead of the pack.
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Lifestyle/Luxury
Luxury, Defined
Luxury is a part of almost every culture and almost everyone wants some form of luxury in their lives. Ipsos Mendelsohn reports that 94% of affluent people ($100K+ HHI) and 92% of non-affluent people have bought luxury goods or services at some point, but luxury is defined differently among the groups. The study found that affluent people usually defined luxury as expensive, of the highest quality, indulgent, and exclusive. The most affluent ($250K+ HHI) group’s definition of affluence skewed more toward exclusivity, prestige, long-lasting, and sophistication, but those who were not affluent (Under $100K HHI) were more likely to define luxury as a treat, splurge, and unique.
So what? Companies advertise with Condé Nast because of our unique ability to promote their brands in an effective manner. These findings on how to position luxury across affluence levels should help bring even more focus to that value proposition. While almost every consumer aspires to luxury and consumes some level of it, the way they think about it can vary greatly.
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Retail/Shopping/Commerce
What Do Shoppers Want? More Technology
In its latest PULSE report, WSL Strategic Retail reports on the top emerging services that consumers want during the shopping experience. In addition to the traditional factors that go into being a good retailer, such as short lines, well-lit parking areas, clean restrooms and knowledgeable staffs, consumers are looking for retailers to provide more technology services. Three out of five consumers indicated that technology was part of a good retail service mix. WSL provides insights and case studies on how retailers are answering this demand for technology in stores. Macy’s is providing free Wi-FI in stores and offering tablet/hand-held devices in many departments to help with product selection, among a number of other advances. Duane Reade has installed a ‘Find Your Look’ kiosk in the beauty section of its Wall Street Location, and Home Depot has developed an app to take measurements during the home improvement process.
So what? Condé Nast has been at the forefront of using technology to enrich the consumer experience. As retailers put more of a premium on providing customers with content and apps to improve the shopping experience, there might be development and licensing opportunities for CN to build new partnerships, and expand current relationships.
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Economy
Banks Losing Credibility with Affluents
It’s no secret that banks have damaged their reputations during the recession. However, a recent Mintel release shows they have alienated one of their key demographics: The Mass Affluent. The Mass Affluents are defined as people with 100k+ income and 100k+ assets. This group represents one of the largest opportunities for financial service companies with over 25 million HHs in the group. Despite marketing efforts, the banks are losing the mass affluent group as financial planning clients. 19% of Affluents said they do not trust banks with their money, the highest percentage in the last 4 years. Affluents ranked banks at number 6 on the most trusted sources for financial advice. They ranked themselves as their number one source and investment firms as number two.
So what? Condé Nast has wide readership amongst the mass affluent. As banks look to restore faith in their industry, Condé Nast can offer a congenial environment to reach this audience.
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Culture
Chinese Consumers Remain Confident
Despite growing inflation, McKinsey found in its survey of Chinese consumers that confidence in their financial future remains high. 58% of respondents expected their incomes to rise next year, compared with 39% of respondents in 2010. And while, Chinese consumers remain ardent savers -- they save over one-third of their income -- they are beginning to enhance their lifestyles by trading up to more expensive products (35% of respondents) and by buying more or more often (60%). McKinsey also reports that Chinese consumers are early adopters of products that have been ubiquitous in Western cultures for many years, but have only gained penetration in China recently. For example, just 46% of consumers bought chocolate two years ago; that number zoomed up to 66% of respondents this year.
So what? By 2020, China will be the world’s second largest consumer market after the United States. Although entrance into the market for international companies comes with a number of risks due to political and social issues, this study reinforces the tremendous opportunity in China for global retailers. As Chinese consumers become more free spenders on goods and services, the competition for their discretionary income will become even more intense.
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Media
Bank Transfer Day: A Social Media Case Study
Recently, angry customers of large banks created Bank Transfer Day, a day the customers were to move their accounts to non-profit credit unions. As much of the event was planned online, Nielsen Media Incite was able to track consumer sentiment and technology use right around the event. Around the time of the event (11/5), negative consumer sentiment (34%) was 10 times higher than positive consumer sentiment (3%) around the big banks. Nielsen captured over 7,000 mentions of the event on 11/5 and found over 60,000 fans on Facebook. The Credit Unions estimate that they received over 40,000 additional sign-ups as a result of the protest.
So what? There’s still scant information about social media’s brand activation power but the relationship between the number of fans and participants provides a high data point.
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Quick Takes
Yahoo! Top 10 Search Terms in 2011
1. iPhone 2. Casey Anthony 3. Kim Kardashian 4. Katy Perry 5. Jennifer Lopez 6. Lindsay Lohan 7. “American Idol” 8. Jennifer Aniston 9. Japan Earthquake 10. Osama bin Laden
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Amazon Prime Hits 10 Million Subscribers
Amazon’s loyalty program, Amazon Prime, was launched in 2005. The program charges $79, and while its main benefit is free two day shipping, it has also grown to offer free movie and TV streaming, and book lending privileges for Kindle owners. Year // Subscribers 2009 // 2,000,000 2010 // 6,000,000 2011 // 10,000,000
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Television Homes Drop Slightly
Television homes dropped slightly in the past year. Nielsen reports that 114.7 million US households own TV sets this year, down -1% versus last year.
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US Airlines Market Share
Delta, American and United led the way in 2010.
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Condé Nast
Feedback, questions, ideas for future issues? Please contact:

Phil Paparella
Condé Nast Research & Insights | Associate Director
1166 6th Avenue, 14th fl. | NY, NY 10036 | office 212.790.6044 | philip_paparella@condenast.com

Contributors:
Tamar Rimmon | Senior Manager, Digital Analytics
Robyn Hightower | Manager, Research & Insights