Scott Galloway, marketing professor at NYU, is one of my favorites. I like his short little videos that cover some interesting fact or trend. This week’s video shares how the percent of young people living with their parents has changed over the last 100 years. The data is interesting. This could be used in class to stimulate a discussion on what this trend might mean for marketers. The in-class activity might work best if you had students assigned to a particular industry, some ideas: a) apartment complex, b) home builder, c) pizza restaurant, and d) cell phone company. I added the last two because they are more marginally relevant and might get students to be more creative. WARNING: Scott does curse in this video – be aware of that it you plan to show it in class and have any concerns.
Branding Changes Respond to Consumer Attitudes
You may have noticed fewer “diet” soft drinks on store shelves in the last few years. Apparently “younger people just don’t like the word ‘diet'” according to the CMO at PepsiCo. Responding to this, Pepsi, Coke, and other soft drink makers have switched product names to emphasize “Zero” or “Zero Sugar.” You can read more in “‘Diet’ soda is disappearing from store shelves.”
The changes in brand names are a reaction to changes in consumer attitudes and behavior. This provides a nice example of the marketing strategy process planning model at work — context (social cultural factors) and customers lead to changes in marketing strategy. This might be a good example to add to your lecture on consumer behavior (Chapter 5) or branding and product names (Chapter 8).
Survey gives insight to the journey to online purchase
We teach our students that it is critical to analyze and understand customer behavior before developing marketing strategies. With all the data available tracking the online purchase journey, many firms are gathering insights all the time. In addition, surveys can provide further insight about how online consumers shop. This article, “Survey reveals how customer make online product decisions” would be a nice addition to a lecture on consumer behavior (Chapter 5), online retail (Chapter 12), or aspects of promotion like owned media (Chapter 16). The article shares interesting information including:
- Consumers are not very loyal — “only 14% say they likely wouldn’t switch to a competitive product if their first choice wasn’t available.”
- Many consumers are research shoppers — “82% of respondents are likely to look at multiple locations for information on products.”
- Information search often starts with online retailers (e.g., Amazon and eBay) where 44% of respondents indicated they looked first, quite a bit higher than those reporting they started with search engines (19%). Amazon now earns a lot from advertising revenue because of this trend.
The article reports a number of other findings and also links to an interesting article with data on social shopping during the pandemic.
Buy Now Pay Later Gets Easier!
Credit cards have long been an easy way for consumer to “buy now pay later.” But not everyone could qualify for a credit card and the interest rates are very high!
These days consumers are seeing an explosion of point-of-sale “buy now pay later” (BNPL) options with companies like Klarna, Afterpay and Affirm. This article at Forbes shows BNPL is expected to grow from ~$24 billion in 2020 to almost $100 billion in 2021. While BNPL can be particularly appealing to young shoppers, who may have more limited access to credit, and it is most popular with Gen Z and Millennials, Gen X and Boomers are now using it as well.
BNPL’s biggest appeal may be convenience. At the point of online purchase, consumers have the option to split that $100 pair of shoes into four $25 payments. And BNPLs don’t charge interest. The risk is borne by the BNPL provider, with the seller typically giving the BNPL service a cut (say 3%) of each sale. That nudge may close some sales and helps retailers. And it looks good to consumers who do not have to pay a premium to buy now pay later.
The growth of BNPL raises all kinds of interesting questions you might want to discuss in your marketing class. There are ethical questions about whether credit is a good idea (see this article in The Atlantic for warnings from personal financial experts).
Shopping During COVID-19 Accelerates Changes in Retail
The brick-and-mortar retail business has struggled through the pandemic. With many retailers closed or shoppers simply avoiding them, online retailers benefitted. That has also created challenges for consumer goods makers that relied on those brick-and-mortar retailers to sell their wares. This Fast Company article, “How COVID-19 accelerated a shopping revolution” describes how fashion brand Rebecca Minkoff responded and offset the loss of sales in its retail channels.
Another Fast Company article describes how omnichannel, “a multichannel selling approach in which a retailer provides a seamless customer shopping experience from computer, mobile service, or brick-and-mortar store” (definition from our textbook, Essentials of Marketing) grew in importance during the pandemic. The pandemic increased the importance of curbside pickup and online distribution. In “Can retailers meet the demands of the omnichannel revolution?” you can read examples of how some retailers adapted.
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