I am sure there will be lots of reflective and projective pieces hitting social media this week – so here is a modest contribution from The Buzzz, an insight consultancy based in the UK. This year sees our eighteenth year in business so we have the perspective and enthusiasm of a late teenager as we write our thoughts down at the start of a new decade!
We are in the insight business so you would expect us to look forward and build some predictions for the year or two ahead. We see the following broad these gaining traction and significance:
Sustainability – Over the past two years, sustainability has risen up the boardroom agenda, with an increasing number of businesses setting targets to reduce their impact on the environment. We expect this trend to gain real traction in 2020 as large retailers and organisations understand the link between co-ordinated action and trust/respect gained from customers and consumers. Ironically in 2010, The Buzzz launched a sister research business focused on this very topic and in looking backwards to gain a perspective on the near future we see the fundamental shift being: “It’s gone from being the sustainability director who no-one really wanted in the room to the person who is absolutely front and centre.”
The key topics will continue to be climate change; plastic packaging and fundamentally single-use plastic; food waste and a better understanding of the economics of sustainability by the consumer. The focus of responsibility will continue to be directed at retailers whom consumers expect to take the lead role. So for the many manufacturers and food processors, we work with: be prepared for some challenges outside of price and margin throughout 2020 as the heat on waste and plastics increases. With our learnings from 2010, we have a great perspective to share on all things sustainable.
Subscription-based Systems – The relentless growth of Amazon Prime and the introduction of many home delivery based food offers like Gousto and Hello Fresh, will, we believe, continue to fuel the growth of retailer focused eco-systems focused on the long-term value of a customer above short term promotions and price matching. Tesco’s launch of Clubcard Plus is a clear example of how retailers are seeking to develop loyalty. The grocer’s initiative was to create “lifetime value” for shoppers. Members of Clubcard Plus pay £7.99 per month and receive a plethora of benefits, including 10% off two big in-store shops worth up to £200 a month, as well of 10% off Tesco’s own-brand clothing and general merchandise, and double data on pay monthly Tesco Mobile deals. Early take-up has been promising and latches onto the developed savviness of today’s consumer while creating a further broad-based platform for development.
Nothing says more about the potential for this trend than the moves being made by disruptive fashion offers like Rent the Runway spilling into more established bricks and mortar offers such as Urban Outfitters who have launched a rental subscription service called Nuuly in the US last year, with shoppers able to rent eight items a month for $88.
Making shopping experiential again – We believe fundamentally we are all social animals who still enjoy the experience of shopping and the interactions it promises but fails to deliver. In the pursuit of fulfilment, we are losing the experiential part of shopping which is a memorable experience. Supermarkets and stores alike need to look to deliver an experience in-store that is memorable, worthwhile and adds to the experience of shopping. We foresee the development of real and virtual experiences, showrooms and collection points, hospitality and community living spaces – and non-traditional ‘retail’ brands moving into physical space to facilitate the brand relationship built online.
Re-investing in our health – Consumers are also increasingly investing in their future health – driven in part by an ageing and affluent population – but also fuelled by the trend towards plant-based diets and alcohol-free drinks. It is just over 5 years ago when a project we did for a drinks manufacturer highlighted the gap for really good and authentic tasting drinks aimed at adults who chose not to drink. Since then we have witnessed a plethora of new AF drinks and the sector is the fastest-growing part of the drinks market, indeed our original client took that idea and has developed a range of 0% drinks which have the alcohol extracted to maintain an authentic hoppy beer, crisp lager and refreshing cider.
M&S successfully launched its Plant Kitchen range last year has “turned up the heat” by creating plant-based versions of well-loved products as a way to tempt and encourage trial. It will launch more than 100 vegan-friendly dishes during the first month of 2020, including the no-chicken kiev.
Veganuary, where people opt to adopt a vegan diet for a month, will be bigger than ever this year and, despite being just a few days into the new year, we’ve already seen a number of high-profile meat-free alternatives to well-known food products. Following on from the success of its vegan sausage roll, Greggs launched a vegan steak bake this week to great fanfare. Meanwhile, KFC’s vegan burger made its debut in restaurants nationwide.
Remember the Middle-Aged Consumer – increasingly the importance of Generation X and Baby Boomer generations is being understood as the opportunity for the next decade as these generations between them grow in size and have huge combined spending power. At The Buzzz we are increasingly focused on this age group – breaking down the vast numbers into meaningful and very different segments for our clients to get to know and understand their motivations and frustrations. Most of this group also feel neglected and overlooked by current brand marketing and retail offers, believing them to be stereo-typed and out of touch with the choices they are making at this stage of their lives.
‘Satiated but not satisfied’ – most related to the point above is our belief that many consumers who are active and able to afford the next 20 to 30 years find that they have reached a point of satiation; they have pretty much everything they want or need or are able to finance that via leases; subscriptions and the like and yet they express a lack of satisfaction, even disappointment in the way new purchases are fulfilled. They feel the need for new experiences; new ways to buy and new ways to bring the experience and the purchase closer together in a more fulfilling manner. We have found a significant proportion of our Generation X and Boomer consumers who are seeking out experiences over and above consumption. They talk in longing terms about the way a customer journey is managed, the care and attention they get; the quality and honesty of advice and guidance they receive and significantly the contact and maintenance of a relationship post-purchase. They relish a surprise, the unexpected level of detail or moments of delight within the customer journey and the potency of this type of experience in the age of fulfilment and next day or same-day delivery cannot be understated.
So all in all a huge amount of things to be positive about at the start of 2020. Please give us any feedback and observations whether you agree with our assessments of what may lie ahead or not – all debate is positive!