|
©
1991-2008 |
Don't Miss the Bus If there's one season a year you can count on kids and teens spending big, it's back-to-school time. By now, nothing fits anymore and even if it does, it's like, so last year. As the demographic surge known as the echo boom (now aged 5 to 22) works its way through the population chain, some retailers and manufacturers are finding that third-quarter sales have begun to rival or even surpass Christmas sales as a percentage of revenues. It's an emerging trend that shouldn't be ignored. From 1994 to 1998, holiday revenues increased 19 percent to $174 billion, while third-quarter sales (non-auto and non-durable) grew 27 percent to $98 billion, according to the National Retail Federation. As the shift away from "event" buying continues, some marketers have accelerated ad spending in the summer season, duking it out for a larger share of the $168 billion spent by or on youths aged 4 to 19 last year. According to one source, fourth-quarter ad spending rose 36.7 percent, while third-quarter spending increased 42 percent, between 1995 and 1998. According to the U.S. Census Bureau, this is destined to be the largest teen population in U.S. history, currently some 31 million kids between the ages of 12 to 19 and projected to grow to 34 million by 2010. When this bunch goes shopping for back-to-school (BTS) stuff, they don't just wander off to the local mall. They research product and brand names on the Internet, exchange e-mails with friends about what's hot, check out their peers' views in online chat groups, and then plot their best buys. Increasingly, they're making those purchases online. In a consumer survey, 20 percent of online teen respondents said they had made an online purchase, and 52 percent said they would make more such purchases if they could. Meanwhile, a booming economy is attracting more teens than ever to the workforce. According to the Bureau of Labor Statistics, more than half of young people aged 14 to 24 today hold some kind of a job. That means more money to spend, but less time to roam the mall. This is also a group with very fretful parents: The high-school slayings in Littleton, Colorado, are just the latest reminder that parents must worry about their children's safety, even at school - an anxiety reflected in BTS purchases ranging from pagers to telephone cards to see-through backpacks. What do marketers need to know in order to understand today's BTS consumers? Here's a primer of major trends. Can I Help You With That? Time was, cereal was thought of as a convenient fast food. Now to be considered convenient, cereal has to come with its own bowl, spoon, and milk. The K-12 age group is redefining convenience: "Effortless" is the new standard. Whether it's a parent packing lunch before work or the kids grabbing their own breakfast on the way to the bus, nobody wants to waste time on food preparation - or even assembly. Sitting down to eat is also out. Manufacturers are responding with "grab-and-go" food products. Meals designed to be eaten cold are also hot. Nowhere is the convenience trend more apparent than in Go-GURT, new from the Yoplait division of General Mills. It's yogurt in a tube, sized to fit in a lunch box. Squeeze it, suck it, chug it. No spoon required. "Utensils are inherently not as convenient," says Josh Resnik, assistant marketing manager for Go-GURT. After consulting consumer research and conducting multiple rounds of focus groups, his team spent months designing a package that could be opened without scissors. And Go-GURT can be eaten frozen, half-thawed, or right out of the refrigerator. "Freezability is a new dimension of convenience," says Resnik. "Whenever or wherever you want to eat it, it's ready." Focus groups revealed that kids wanted to have fun with their food - and the package, too. "Older kids loved to slam it down quickly; they were practically chugging the yogurt," Resnik says. "The 8-to-12-year-olds would finish the yogurt in about 15 seconds, then spend 10 or 15 minutes playing with the package. One kid took a pen and pressed the container to get every last drop." The Adult Teen So long, slackers. Generation Y scores high on maturity, and while their attitude is often edgy - piercings and tattoos and Mohawk hairdos are the norm in this crowd - they're a very optimistic bunch. As teens earn more money, their power over purchases grows, too. U.S. teenagers spent $94 billion of their own money last year - $10 billion more than in 1997, according to one expert. But teens and children aren't only making up their own minds about what to buy: They're exerting influence over family purchases. A study by Channel One, the network that broadcasts news and education shows to secondary schools, found that $20 out of every $100 spent each week by teen households is at the specific direction of teens; they influence at least $20 billion a year in grocery purchases alone. Kids under 12 spent almost $27 billion of their own money last year, according to a Texas A&M study. By age 8, they've made their first independent purchase, often at a convenience store. It is predicted that their total spending will grow to more than $35 billion next year. And their influence is anything but child's play: one industry analyst estimates children may influence as much as $485 billion in parental spending, on items as diverse as orange juice and personal computers. Wired From Birth Last year, 14 percent of kids and teens - or 8.5 million people - were online, according to one study. This year it doubled to 16 million and, by 2002, it is expected to double again. Considering the exponential growth rate of online commerce, not to mention kids' comfort with the medium, the implications for BTS online commerce are pretty blatant. Online teens visit an average of 3.2 sites before making a purchasing decision, according to the study. And very few manufacturers and marketers are addressing the teenage online shopper. The lack of a credit card, obviously, is a major barrier to online commerce for kids and teens. San Francisco-based iCanBuy.com hopes to clear that hurdle. Targeting consumers ages 10 to 16 - old enough to spend but not use a credit card - iCanBuy.com allows parents to set up online accounts with specified retailers. These "electronic wallets" are debited each time the child makes an online purchase. Parents monitor the spending, and users can craft a "wish list" for family and friends to consult when holidays and birthdays roll around. I'll Do It My Way Some researchers call this trend the "democratization of creativity," but teens said their most valued traits are individuality and uniqueness. Children, teens, young adults - all want to customize and personalize their image, dip into different streams of history, iconography, and symbolism, and craft an individual message that communicates uniqueness even as it confirms membership in a group. Or groups. Part of this trend is a rediscovery of the past. Swing dancing, VW bugs, Star Wars, Yoo-Hoo drinks. "But it's not just a matter of looking back. It's taking stuff from the past and creating new trends for the '90s and the new millennium," says David Morrison, president of TWENTYSOMETHING I nc., a young adult consultancy in Philadelphia, Pennsylvania. The past is not a place to long for, but a huge catalog of raw material to cut-and-paste into personal statements of identity.So expect an inconsistent, mix-and-match BTS season in which khakis and colorful accessories are equally popular. (Indeed, the return of color is one of the dominant trends of the coming season.) Where VW bugs are accessorized with leopard seat covers and oversized wheels. Where elaborate hairstyles inspired by Star Wars coexist with artless drawstring peasant blouses. So the ability to customize a product may be key to its success. In this do-it-my-own-way culture, the retail store is becoming a place to sample and experiment with looks. Old Navy, Gap, and Abercrombie & Fitch continue to dominate apparel trends for this group, but they are being joined by edgier retailers, like Wet Seal and Gadzooks, that espouse a "skater" image. Although the merchandise could hardly be more different, these stores share a retailing philosophy: They're not selling clothes. They're selling a lifestyle, a club that teens want to be in. Who You Gonna Trust? The growing incidence of school violence has intensified concerns about safety. No surprise, then, that personal safety items will be on more BTS shopping lists this fall, driven by new school policies as well as fear. "Some school districts are beginning to mandate see-through or mesh backpacks, so we're starting to see more of those," says SHOPA president Steve Jacober. "And we're seeing some gradual change to the adoption of school uniforms. When that happens, consumers are forced to find expression through the products that they use and carry, like pencils and notebooks." Pagers and cell phones are hot items, too. "Parents want them for safety reasons, but kids want them for status and fun," says Morrison of TWENTYSOMETHING I nc. "Manufacturers like Nokia are responding to their desires by creating colorful snap-on plates, allowing users to coordinate their pager with their apparel."Meeting On Campus Overall, enrollment in higher education institutions increased by 14 percent between 1986 and 1996, from 12.5 million to 14.3 million, according to the latest data from the National Center for Education Statistics. Meanwhile, minority enrollments grew from 22.5 percent in 1992 to 26.1 percent in 1996. Much of the change has been in the number of Hispanic (8 percent) and Asian (6 percent) students. In 1996, African-American students accounted for 11 percent of higher education enrollment. Growing college enrollment is sparking new competition for the back-to-campus shopper. Marketers are beginning to shift from a kids-and-teens-only focus for BTS to one that encompasses college students as well. In particular, stores like Bed, Bath & Beyond and Linens `n' Things are addressing the college-bound. These retailers are selling themselves as a one-stop-shopping place for back-to-college needs. Delia's recently expanded into home furnishings for teens and college students, who are showing as much initiative in furnishing and accessorizing their rooms and apartments as they are in selecting their own wardrobes. Color My World Close to one-third of the U.S. population is non-white today. By 2025, that percentage will grow to 48 percent, according to the Census Bureau. Today's 15-to-24-year-olds, the most racially mixed group America has ever spawned, are 60 percent more likely to be non-white than their grandparents. Still not convinced that diversity matters? Some 14 percent of U.S. residents age 5 and older speak a language other than English at home. Several major American cities and about 200 U.S. counties already have a "minority majority" - their combined non-white and Hispanic populations exceed their non-Hispanic white population. * * * YOUNG ADULT MARKETERS! Abbreviated Version |