grass roots
About Through the Loop

Press Coverage

Press Releases

Marketing Direct, October 1999

Think Tank Consumers of the Future

Direct to the Future

As the pace of everyday life speeds up in the race for the 21st century, how can marketers grab the attention of their customers

By Karen Fletcher.

Marketers have long been charged with the task of looking into the future and making predictions- about consumer likes and dislikes, brand image, product requirements and many other aspects of business.

This month, our Think Tank panel peers into the next few decades and asks what will consumers look like, act like and shop like. And how marketers will have to adapt their thinking and strategies to meet the needs of Millennium consumers.

The panel
  • Dawn Orr, sales and marketing director, Claritas

  • Ian Johnson, marketing manager interactive advertising, Two-Way TV

  • Clive Cooper, joint CEO and managing partner, The Brand Futures Consultancy

  • Martin Payne, strategic projects director, Through the Loop

  • Stokes Jones, consultant, editor of Planning for Consumer Change, The Henley Centre

One thing our panelists all agree on is that we are all time poor these days, and that those with the cash to spend will spend it on time-saving devices and services. Martin Payne, strategic projects director of research company Through the Loop says: "The availability of time for individuals seems to be polarizing, with people either working very long hours or not working at all, or people working on a contract basis. There are also more things to do in leisure time, more options with more to fit in. So everything is squeezed."

Stokes Jones, consultant at the Henley Centre and editor of the report Planning for Consumer Change, adds: "We are certainly time-poor. Sixty-three percent of people now agree that they donít have enough time to get things done. The word Ďstressí has spread out through society; itís something that everybody has. Thereís even an aspirational aspect to stress because it goes with having responsibility and status."

He adds: "People are really willing to spend money to get their time back We can see this in the increased spend on things like fast food, child care, etc. We want to outsource chores like cooking, cleaning- the things we donít really enjoy. We did research about five years ago with First Direct, and one of the questions we asked about was queuing. At the time, respondents werenít so bothered, now people are willing to pay a premium to move to the head of the queue- itís their time."

Jones cites the example of a retailer in Holland that uses LED price tags under each item which can be changed depending on what time of day it is. There are different prices for peak and off-peak grocery shopping.

We are already witnessing a surge in popularity of home delivery services like those offered by Iceland. One other implication of time-poor consumers is that more companies will offer people better ways of filling what time they do have.

"Just providing the solution to all this isnít simply streamlining or fast-tracking," says Jones. "What you are aiming for is that people want the time they do spend for themselves to be deepened and enriched. For example, more people want to become connoisseurs in areas such as wines and vintage cars. Value for time is becoming as important as value for money."

So much choice, so little time

The array of choice now on offer to consumers can be overwhelming. Clive Cooper, joint CEO and managing partner of the Brand Futures Consultancy, says: "Consumers have so many choices now. If someone could edit the choices, I think that would be a really useful service. For example, in financial services you could pay someone to read through all the literature and find the right product for you."

As well as becoming increasingly pressed for time, consumers are now more marketing literate than ever before- and growing more cynical about what organisations tell them. At the same time, new media and technologies are enabling marketers to get closer to their customers.

Cooper says: The consumer is no longer a passive receiver of advertising messages. With two-way communications it is possible to build relationships with customers. It is important now not to think of them as consumers, but as members of your company or wider community."

Cooper adds that these closer relationships will have to be handled carefully: "I think consumers will still want to have relationships with companies, but fewer of them. Instead of 101 loyalty cards and 101 relationships, you may only have five loyalty cards and much richer relationships with those five companies. Fewer companies will offer broader services, foe example Centrica could supply gas through British Gas as well as electricity and financial services.

Smartcards add a personal touch

One prime example of the way technology is already affecting the way companies talk to consumers is interactive advertising. Ian Johnson, marketing manager of specialist Two Way TV, says: "There is smartcard technology in the set-top box which relates to the subscriber management technology of the channel. This smartcard can store the name and address of the subscriber. This means that with interactive ads you can insert the viewerís name into the ad on the screen. You can also supply details of the nearest stockist of your product or nearest dealer. The most impressive things really is that you can tailor your message. It also means that marketers can send tailored information to consumers, depending on what particular products they have shown an interest in."

Payne adds that the new media require a subtle approach: "Itís not a question of who shouts the loudest by buying slots on ITV. Maybe itís about who shouts in a different way, or who comes and taps you on the back while youíre not looking by tuning out the big brand hard sell messages."

However, Payne points out that marketers should be aware that not all consumers will have access to these technologies. "Polarisation in society is not just about money. Itís about access to devices and information. Ultimately, it may be that everybody may be able to have Internet access in the high street, with those people paying more on a by-the-minute basis than those who have permanent access at home."

Technology that allows consumers and companies to build closer relationships is generating greater amounts of information for marketers to deal with. Dawn Orr, sales and marketing director of consumer information specialist Claritas, says: "What marketers are building their communications with is far more advanced than it has been before. And it has an impact throughout the company." The problem of data deluge is one faced by all marketers, but Orr points out that they are becoming more expert at dealing with it.

"There are core traits going through any kind of consumer information which can be identified before you do any kind of segmentation work. Most of this is built around consumersí behaviour- what theyíre doing at a transactional level. You find out what they are doing and work from there. There are no more than about ten pieces of information about consumers that a marketer can really cope with. I think that as consumers we are becoming more individualistic, but we are all still human and have basic human needs so there is that underlying data."

Many companies are already using the data they have gathered through loyalty schemes to extend their brands- supermarkets now offer banking services and credit cards; banks can arrange holidays; Virgin offers just about everything you can think of.

Is the conventional brand model dead?

Cooper asks: "Is the concept of a brand as a mark of distinction passť? In the end itís becoming less relevant. The new companies in the market are crossing borders. They take brand values and stretch them so far. Is the conventional brand model dead?

Martin Payne says the idea of brand is certainly changing: "We have reached the level where the brand is a communications vehicle. Take the Disney store. You canít go to a DisneyWorld every week, but you can go to the store and itís free. The Disney Store is less about retailing and more about enhancing the Disney image. Cadbury World is another example. But thatís just based in Birmingham so perhaps they could do more, say in local newsagents."

There is a small caveat to building products or extending brands on the back of collected consumer data. Some of the best business ideas (the Sony Walkman, Post It Notes and microwaves) werenít the result of market research. Jones says: "Some people says that asking the consumer if they will like a product can be like looking in a rear-view mirror because their imagination may be limited by whatís already out there."

Jones adds that marketers should be relying on data collection or traditional research methods in developing new products or brand extensions: "You have to spot the gaps that consumers cannot yet articulate. Observational research is now the thing to do. People go into homes and observe how consumers behave. They can spot the opportunities that people canít see themselves because they have learned to work around things."

But increasingly knowledgeable consumers will shape the way companies can communicate their brand values. They wonít be able to get away with much, according to Jones: "The traditional job of marketers was to create a story about a product. They werenít necessarily meant to be based on hard facts, so they were selling dreams that werenít necessarily borne out. More and more companies will get Ďfound outí on this level. There will be realization in the internal corporate culture that creation has to be a seamless whole. You shouldnít sell something thatís not there."

Safeguard your reputation

Cooper agrees: "If there is something wrong in your production processes, for example, youíre using child labour in the third world, you are going to be found out much more quickly. Business is much more transparent - if youíre telling less than the truth , youíre going to be found out."

Payne adds: "Everything you do will communicate something to the consumer. When companies talk to their staff it goes through to the consumer. When banks makes staff redundant, the ones who are left are not going to be very motivated. Or how your companyís van drivers behave in traffic- all these make an impact on your consumers."

Marketers will have to ensure that the brands they create will remain flexible. Payne comments: "Brands have to age well. Nescafť is one brand that has lasted a long time by retaining its core values while updating its image. Madonna is another example.

Cooper says brands canít afford to rest on their laurels: "Itís getting harder to maintain the position of the brand. Look at how Marks & Spencer changed. People are saying now that itís not as good as it used to be."

Banks are cited as the prime example of companies that remained unchanged for decades. Customers didnít leave, and the banks assumed that they were content with the products and services on offer. When First Direct came along it was hailed as a revolution in banking- although the products it offered were standard, itís delivery system was so different. But even First Direct will have to move with the times- telephone banking services are now offered by all the high street banks so it is no longer as great a point of difference as it once was.

The picture painted of the future by this monthís panel is one in which marketers have more knowledge in their hands than ever before. Database marketing has given marketers real information, not just speculation. Markets will move faster, product development will be quicker, but products and brands must renew themselves constantly to retain market position.

Direct marketers are well placed to deal with future consumers. Understanding them, delivering what they want and communicating regularly are all grist to the mill of those involved today.

But the flow of information will be two-way. Marketers will know customers but 21st century consumers will be more marketing aware than previous generations- wary of advertising whitewash and quick to abandon those products and brands that donít deliver.

As Jones says, maybe this is the free market working as it should. But he adds: "When these brands fall, itís the perfect way of the market sending a message. Consumers are saying, " ĎWe like your products, but your status is temporary if you donít keep upí."

company | knowledge | services | grass roots | contact


© Through the Loop Consulting Ltd 1996-2000