Langer forecasts consumer marketing issues

Each year, Judith Langer, president of New York City research firm Langer Associates, Inc., and her team of researchers interview thousands of people throughout the U.S. in focus groups to identify the major shifts in consumer attitudes, values and behaviors that will affect the marketing of goods and services. Below are some of the findings.

  1. Self-security. With the fallout from downsizing continuing, and many consumers, including employees of big companies and government, feeling the shock waves of insecurity, self-employment is increasingly viewed as a better option (you can’t be fired). Langers expect there will be more entrepreneurs, either by choice or necessity. Advertising that shows business owners (the American dream) will appeal, as will educational courses and media about starting/running your own business.
  2. The Me Generation becomes the Mine Generation. In the ’60s, people wanted serf-expression and freedom from marriage and children. Now, with a sense of stretched, sparse resources, the Mine generation is intent on preserving its jobs and turf, including family, community, ethnic group. In one of Langer’s focus groups, aman said,"I’ve worked damn hard for this. It’s mine and I’m not going to give it up." The impact of Mine Generation thinking is showing up in economic and political attitudes, especially of Baby Boomers. Marketers and politicians can either play to this approach (protect what you have) or appeal to people to rise above it.
  3. Alone-togetherness. The popularity of coffee bars and the Internet is at least partly accounted for by their ability to satisfy a duality of desires. Both environments make it possible to "connect" with others while also satisfying the desire to avoid intrusive interaction. Coffee bars allow people to feel less alone and isolated (other people are there) without having to talk to them. On-line forums connect people without their having to see one another or having to respond when they don’t want to. The growing singles population makes it likely this trend will continue (although it is not limited to them). "We all want that’ Cheers’ experience," one respondent said - to have a"place" to go, to be part of a group, but not necessarily to have to react to others. Marketing implication: Stores, restaurants and clubs can build in these zones of "alone-togetherness."
  4. Topsy-turvy retailing. Consumer satisfaction with retailers doesn’t necessarily go along classic lines. Some customer service than more upscale stores. Marketing implication: Upscale stores need to work harder on their customer service. Lower-price stores should promote customer service along with lower prices.
  5. Battle of the superstores. Some consumers feel conflicted about patronizing superstores vs. the smaller neighborhood stores (independent or smaller chains) where they’ve shopped for years. They like the more personal atmosphere of the smaller stores, appreciate their service and even sympathize with the owners’ plight. But, it’s the superstores that more often win their business. Not only do superstores lure customers with big discounts, some also offer better organization and broader selection of products, and, in the case of such retailers as Barnes & Noble, an exciting, sociable, "where-the-action-is" atmosphere (repeat of the "alone-togetherness" trend). Anytime the smaller stores give less than stellar personal service, they give customers a reason (or an excuse) to go elsewhere. Until consumers grow tired of superstores (Langer is hearing more about chain store "sameness"), their prospects look very good. Smaller stores will have to struggle to maintain service, fred niches to fill, and do more direct marketing.
  6. Woo-me marketing. Consumers have come to expect retailers and other marketers to win them over with sales and special promotions. If they are not sent a credit card, some respondents said, they don’t bother to apply. Why take the time? They’ll come to me, they say. Implication: Business needs to be more pro-active, create excitement with free trials, gifts with purchase, etc.
  7. Marketing to GenX yups. As some twentysomethings get more settled in careers and feel more "flush" financially, they’re spending more, and treating themselves to goodies like large-screen televisions and nice clothing. (This is especially tree of singles). But, twentysomethings are still different from ’80s yuppies. Two examples, they’re less" likely to see themselves making "big money" and they’re less into designer labels. While they are highly brand conscious, their tastes often run more to trendy companies like J. Crew and Banana Republic and off-price specialty stores like Today’s Man. Marketing implication: Appeal to these new-monied yuppies with ads that make it seem like they’re buying to get value and not for status or because of peer influence.
  8. Clothing cutbacks. As 1995’s disappointing holiday sales showed, consumers are buying less clothing. This trend is expected to continue until a new style causes fashion excitement and stimulates apparel purchases. Many consumers are saying: I have more clothing than I need. Underlying their behavior is the casualization trend (if you don’t dress up for work or social life, why do you need more "stuff?."). Consumers are shifting spending to other areas (the home, travel, financial investing).
  9. High-tech polarization. Even though computer use is widespread today, attitudes toward the technology’s impact on our lives are still polar opposites, even among users. The benefits - time-saving, convenience, efficiency, fun - are obvious. While technology buffs are excited, many people express concerns about depersonalization in business and personal relationships, job layoffs due to computerization, security and privacy of computer transactions, children’s computer "addiction," difficulties in navigating the Internet, professionals bogged down with clerical work, and the high price of staying technologically current. The Internet will either be the most dramatic change in communications or "the CB radio of the ’90s," one New York man prognosticated. Marketing implication: These divided reactions suggest that marketers will meet resistance to the adoption of high tech in certain areas. They will need to build in reassurance and fred ways to maintain the human touch.
  10. Data glut. Complaints about being overwhelmed by information are up sharply. Rather than not having enough information to make decisions, people feel there’s too much -too much to sort through or even be interested in. There’s a potential market for simplified information, for ways to screen out extraneous communications.
  11. Changed office structures. With clerical/administrative levels thinned out, and executives having to do more for themselves, there’s a market for foolproof photocopying and computer products. Outsourcing will continue to grow. The new status symbol for senior management is not having to go in to the office every day and phoning or faxing into the office from a ski lodge, boat or weekend house. Growth areas will be products that help with telecommuting, from home offices or the road.
  12. Solitude time. More people feel drained by their jobs, especially in the growing services sector. As a result, they need quiet time when they don’t have to be on the phone or have others making demands on them. Some products that should be positioned for these quiet times: aromas, yoga, coffee, tea, newspapers, magazines, television viewing.
  13. Working at relaxing. The "serenity-seeking" trend continues in a variety of ways as stressed-out professional/managerial types adopt strateNes to relax. These include escaping weekends to country homes, scheduling massages, decorating city apartments in informal country style, gardening and renewed interest in candles. Advertising can talk about people deserving to relax and can depict the humorous side of "studied" relaxing.

Genealogy business takes root

Tracing family roots is popular among Americans according to a new Maritz AmeriPoll by Maritz Marketing Research Inc., St. Louis, Mo. Nearly half of Americans (45 percent) are at least somewhat interested in genealogy. The hobby holds appeal for both younger and middle-aged Americans with 48 percent of those age 25-64 having at least some interest. Surprisingly, Americans over age 65 claim less involvement with genealogy; only 39 percent said they parficipated.

By far, the most popular method for tracing family origins  is discussing it with relatives. Ninety-four percent of amateur genealogists have used this method. Fifty-seven percent have created their own family trees, and nearly half (45 percent) have traveled to their ancestral homes or countries. Other popular methods for genealogical research include: purchasing or reading genealogical books (28 percent), contacting vital records offices (26 percent), contacting local historical societies (13 percent), contacting the Census Bureau (12 percent), purchasing genealogical software (11 percent), joining family associations (10 percent), and contacting the Mormon archives (10 percent).

Maritz AmeriPoll is a national consumer opinion poll conducted regularly by Maritz Marketing Research. Results are based on telephone interviews conducted with 377 men and 400 women. Accuracy of the results is within +/- 3.5 percent.

Mileposts on the superhighway

As reported in the "Bruskin/Goldring Research Report," the percentage of Americans who say they are riding the information superhighway has almost doubled in the past year. According to identical OmniTel telephone surveys conducted during the summers of 1994 and 1995 by Bruskin/Goldring Research, Edison, N.J., use of on-line services among personal computer owners has grown from 14 percent to 25 percent. While one-quarter of personal computer owners subscribe to an on-line service, nine percent of total adults are subscribers.

Ownership of personal computers among total adults grew from 27 percent to 32 percent between the 1994 and the 1995 surveys and ownership of modems increased one percentage point to 15 percent. America’s cybernauts continue to be disproportionately upper income, male, between 25- and 49-year-olds, and from the West.

In 1994, 4 percent of total adults subscribed to an on-line service and 6 percent said they planned to go on-line within the next six months. In the 1995 survey, 10 percent of total adults (22 percent of PC owners) plan to subscribe"within the next six months."

In the ’94 study, 27 percent of total adults said they owned a PC and 10 percent said they planned to buy one within the next six months. Actual ownership of PCs grew five percentage points between the ’94 and the ’95 studies.

Men are seven percentage points more likely than women to own a PC. Four in 10 adults aged 25-49 own a computer, compared to 31 percent of 18-24 year-olds, 25 percent of 50-64 year-olds, and 13 percent of adults 65+. Nearly six in 10 respondents with household incomes greater than $50,000 own a computer, versus one-third of those earning $30,000-$40,000, and 28 percent of those earning $40,000-$50,000.

The West continues to have a higher share of PC owners (38 percent) than the Northeast (31 percent), the North Central (33 percent), and the South (29 percent). More than one in 10 (11 percent) adults say they plan to buy a PC within the next six months. Six percent say they plan to buy a PC and a modem within the next six months.

Ownership of modems increased only one percentage point between !994 and 1995 (15 versus 14 percent)among total adults. In the ’94 survey, 6 percent said they’d be buying one soon. In the 1995 study, 9 percent of total adults (15 percent of computer owners) say they intend to buy a modem within the next six months.

Pizza sales heated up in 1995

Total pizza sales climbed to $22.2 billion in 1995, posting a 5.7 percent increase from 1994, according to "The Pizza Market," a new study by Packaged Facts, a New York-based research company. Also, according to the study from 1991-1995 there was a 25.4 percent increase in the market, amounting to $4.5 billion dollars.

The strong inroads pizza has made in American culture and its widespread popularity with all segments of society has made this a very lucrative market. According to "The Pizza Market," ready-to-eat pizza marketers achieved estimated retail dollar sales of just under $20 billion in 1995, a 6 percent increase from the previous year.

"When the G.I.’s returned home from World War II, they brought back newfound, exotic tastes. One of these was a love of pizza. Pizza had not been popular except in a few major Eastern cities prior to that time. The rest is history," says Joan Young, project manager of Packaged Facts.

The four main pizza product categories - ready-to-eat (RTE), frozen, refrigerated and shelf-stable - are only differentiated by method of preparation, not by ingredients. Of the four, RTE accounts for the majority of dollar sales, maintaining approximately a 90 percent share from 1991-1995. Frozen pizza averaged about 8.5 percent, while refrigerated pizza held close to 1.0 percent and shelf-stable (pizza shells, dry mixes/flours) accounted for 0.5 percent.

"Undoubtedly the recession has influenced the increase of pizza sales," notes Young. "The workplace has changed forever, job security is a thing of the past, and the nuclear family has been seriously battered. As Americans struggle to provide for their households, they have been increasingly attracted to pizza because of its ease of preparation. Indeed, it is particularly popular among Baby Boomers, who are the first generation to be raised on pizza. And they in turn are passing on their taste for it to their children. The National Frozen Pizza Institute has reported that pizza has replaced hot dogs as the most popular kids’ choice for meals."

In 1995, projected sales in the frozen pizza category were expected to have surpassed $1.9 billion, a rise of 3.5 percent. This growth rate is down from the 1994 level of 11.7 percent. At that time the segment was powered by Philip Morris/Kraft Foods’ rollout of Tombstone pizza. Refrigerated pizza sales have grown by a total of nearly 29 percent from 1991 to 1995, finishing the period at $229 million. And shelf-stable pizza has seen a total growth rate of 5.8 percent during the years from 1991 to 1995.

Pizza marketers run the gamut from diversified global marketers like Stouffer’s and Pizza Hut to tiny in-store or even home kitchen operations. According to "The Pizza Market," there are approximately 200 packaged pizza marketers with roughly 45 of those achieving significant market share. There are, however, over 60,000 ready-to-eat pizza outlets with more than 25,000 belonging to independent operators.

"This is definitely a win-win situation," Young says. "Fear of ready-to-eat market saturation has come and gone, all the other segments have improved in quality and most importantly, the consumer is happy."

Light foods clog shelves

In 1995, Jack Sprat’s grocery shopping got easier, or more difficult, depending on how you look at it. The
number of new fat- and cholesterol-reduced foods reached an all-time high in 1995, according to The Lowfat Monitor, a monthly newsletter published by the New York City research firm FIND/SVP.

The Lowfat Monitor, which tracks news and trends related to reduced-fat and reduced-cholesterol foods, selected 965 new retail items for inclusion in its monthly Products Tables during 1995. This figure is more than 2.5 times the number of introductions reviewed by The Lowfat Monitor in 1991, and is nearly 40 percent higher than the number of product launches recorded in 1994. This phenomenal increase reflects a synergy of consumer demand and marketer response, supported by increased government clarification over product labeling issues.

Each of the seven food categories covered by The Lowfat Monitor showed substantial growth in product
introductions, with snack foods demonstrating a leading 60 percent increase over 1994, and baked goods and prepared foods each exhibiting growth of about 44 percent.

One-third of the 21 segments within these categories showed new-product growth of 50 percent or more. Topping the list was the mixes/doughs/ingredients segment, with an astronomical growth rate of 160 percent over 1994. An important trend in this segment was the use of decidedly low-tech fat substitutes. For example, the lowfat/low-cholesterol attributes of many mixes listed in The LowfatMonitor’s Products Tables depend upon the cook’s using a specific ingredient - egg whites, egg substitute, yogurt, applesauce, bananas, pumpkin, tofu - in place of shortening. Also interesting was the increased availability of oat- and fruit-based fat substitutes - already widely used commercially in sweet baked goods, and now designed for use in the home.

Other segments showing major growth were refrigerated yogurts, up 72 percent, and salty/crunchy snacks, up 62 percent. In both segments, growth reflected increases in the number of flavor varieties available.

Yogurt isn’t for dieters anymore. According to data provided by the United States Department of Agriculture, yogurt consumption has quadrupled since 1970, and it is likely that new intriguing flavors have contributed toyogurt’s recent popularity. In 1995, !owfat yogurt was featured in such flavors as banana cream pie, coconut cream pie, key lime pie, and cheesecake. The use of "crunchies" - granola, cookie pieces, or other sweets that come in a separate cdntainer and are mixed into the yogurt by the consumer - and yogurt/gelatin combinations have also enhanced yogurt’s appeal.

The astonishing growth of new salty/crunchy snack products in 1995 to 141 items was anticipated earlier in the year when FIND/SVP and Thomas Food Industry released the results of a survey in which 95 percent of snack-food manufacturing companies said that sales of reduced-fat snacks were increasing. Nearly three-quarters of this segment was made up of popcorn, potato chips, pretzels in such notable varieties as garlic, poppyseed, herb, and mustard; and rice cakes in a great variety of unusual flavors (peach cobbler, cheesecake, chocolate mint, blueberry, peanut butter, and salsa).

A notable area of decline during 1995 was in the reduced-fat, reduced-cholesterol spreads segment, reflecting a resurgence in the popularity of butter attributed to concerns about trans-fatty acids in margarine and other non-dairy spreads, as well as to the poor performance of lowfat spreads and butter substitutes in flying and baking.

Meanwhile, keying the overall new-product increase was the accelerating expansion of reduced-fat and reduced-cholesterol products into regional, ethnic and international cuisines, as well as the increasing prevalence of convenience foods and reduced-fat and reduced-cholesterol foods for kids.

Southwestern and Mexican foods alone have come to represent almost 10 percent of the new products included in The Lowfat Monitor’s Products Tables in 1995. These items included side dishes and prepared meals and entrees (refried beans, burritos, fajitas, enchiladas, tamales, chili); foods used in the preparation of Mexican/Southwestern dishes (tortillas, for example); and chips and dips (tortilla chips, blue corn chips, black bean chips, guacamole, picante sauce, and especially salsa). Also included were foods that could be identified as Mexican/Southwestern because of clues in their names ("South of the Border," "Santa Fe Style," "nacho") or ingredients (chipotle, lime, cilantro, jalapeno, habanero, pinto beans, "con queso," "tomatillo"). Products with a Southwestern/Mexican flavor were especially prominent in the condiments and prepared foods categories.

Reduced-fat and reduced-cholesterol Italian foods, Asian foods and South American foods are all part of the overall "adventure eating" trend identified by Product Alert. In its December 4, 1995 issue, the publication noted, "There’s a real trend toward adventure eating, i.e., sampling foods of the world right in the comfort of your own home." Among products inspired by international cuisines, 56 percent were available in Italian/ Sicilian varieties or flavors, including pasta sauces and pizzas as well as an unexpected  flood of biscotti. Asian products (Chinese, Japanese, Thai, Indian, and those referred to as "Oriental") made up over one-quarter of the "foods of the world" featured in The Loufat Monitor’s Products Tables during 1995, and ranged in "authenticity" from frozen beef lo mein dinners to chutney imported from India, rice dishes imported from the People’s Republic of China, and seaweed dishes imported from Japan.

Another significant "international" segment included products in South American, Caribbean, Jamaican, or "tropical" varieties, many of which were frozen desserts in flavors as familiar as mango and as exotic as capuacu. Almost half of the convenience foods featured in the Products Tables during 1995 were mixes for foods ranging from sweet baked goods to bread to side dishes. Other fat- and cholesterol-reduced products designed to make cooking and baking less labor-intensive were shredded cheese, pourable omelets, refrigerated cookie dough, and pizza and pie crusts.

The Lowfat Monitor defines foods for kids as those whose marketers clearly identify their targets, as well as those with telling properties - pretzels in the shapes of airplanes and dogs, for instance, as well as cookies and fruit snacks designed to resemble cartoon characters, packaging graphics that feature dinosaurs and games, and frozen desserts described as "tubular." Although goods for kids accounted for a mere 3 percent of all reduced-fat and reduced-cholesterol products in 1995, this proportion and its corresponding number are both higher than in 1994. The Lowfat Monitor expects this to be a significant area of growth over the next few years as parental demand increasingly drives marketer response.