A TCI Book Review

Harness the Future ­ The Nine Keys to Emerging Consumer Behaviour Shirley Roberts John Wiley and Sons, Toronto, 1998

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This book is yet another in a series of analyses of various trends and how they will impact on business. Roberts is the founder of a Canadian company called Market-Driven Solutions Inc., which specializes in strategy and business planning for consumer goods and services companies. Prior to starting her own consulting firm, she had fifteen years of experience in the packaged goods industry.

Her framework for analysis identifies nine areas of influence in consumer behaviour: five of which she calls 'leading drivers' (as they are factors which shape consumer reactions) and four of which she calls 'responsive drivers' (as they are influences by the ways in which individuals and businesses respond to the leading drivers. She calls this approach econographics:

"Consumer spending accounts for 66 per cent of the gross domestic product (GDP) in Canada and the United States, so it is no surprise that it significantly affects the economy, governments, educational institutions, the workforce, the retail sector, consumer-based manufacturers and service providers, and the financial services and investment community. Finding a way to anticipate consumer buying behaviour would be invaluable to both the private and public sectors, given the profound effect consumers have. Econographics is a predictive model that can help business people anticipate future consumer demand. It monitors how the world is changing and is likely to change in the future, and predicts how consumer behaviour will be altered as a result." (p.15)

She likens econographics to econometric forecasting, in that there are various leading and lagging variables that together combine to produce economic behavior. In her approach, the equation is:

Leading Drivers plus Responsive Drivers equals Consumer Behaviour

As opposed to a quantitative analysis, though, as would be the case with an econometric model, her approach is qualitative in nature. It essentially acts as a checklist of factors (trends) that can stimulate thought and discussion.

She identifies a 'trend' as a "consistent pattern which will likely be in effect for five or ten years or more, whereas a fad will play itself out in a much shorter time, as little as one to two years or less". (p.28) Once identified, trends can then be 'leveraged', meaning that a company can think of ways to capitalize upon them.

The trends themselves (there are 38 of them discussed in the book, spread out among the 9 areas) she has identified through extensive research, monitoring a variety of publications and events across a wide spectrum of society. The table below summarizes the nine key drivers:

Leading Drivers

Economy	Trend #1 ­ The gap will widen between winners and losers. Trend #2 ­ The economy will grow and inflation will remain dormant. Trend #3 ­ Standardized work will decline. Trend #4 ­ Female influence will increase. Trend #5 ­ Workers will become more educated.
Technology	Trend #1 ­ The microprocessor and humans will form an inseparable bond. Trend #2 ­ Digital networks will drive disintermediation. Trend #3 ­ Technological change will shorten product life cycles. Trend #4 ­ Technologies will converge. Trend #5 ­ Wireless technology advances will increase access to information.
Globalization	Trend #1 ­ Expansion of trade will open up new markets. Trend #2 ­ Global market forces will intensify competition. Trend #3 ­ Stronger market forces will create a far more connected world.
Government	Trend #1 ­ The role of government will shift from parental protector to country navigator. Trend #2 ­ Global competition will force governments to sacrifice social spending. Trend #3 ­ Globalization and technology will make tax revenues harder to collect.
Environment	Trend #1 ­ Environmental abuse will remain a serious problem. Trend #2 ­ Environmentalism will become a way of life.

Response Drivers

 

Demographics	Trend #1 ­ Ethnic and regional diversity will grow. Trend #2 ­ Family structures will be more diverse. Trend #3 ­ the population is ageing. Trend #4 ­ Life-cycle stages, lifestyles and attitudes will be less influenced by chronological age.
Consumer Psyche	Trend #1 ­ Spirituality and human reconnection will be sought. Trend #2 ­ A higher quality of life will be pursued. Trend #3 ­ The desire for new experiences and innovation will grow. Trend #4 - Shoppers will become more impatient and demanding. Trend #5 ­ Consumer vigilance for value will grow.
Wellness	Trend #1 ­ Medical science will continue to improve the quality and length of lives. Trend #2 ­ The incidence of disease will increase. Trend #3 ­ Complementary and alternative medicines will become more popular. Trend #4 ­ Self-health care will flourish. Trend #5 ­ A healthy lifestyle will become the new miracle drug for longevity and disease prevention.
Retailing	Trend #1 ­ Fewer, clearly differentiated retail chains will survive. Trend #2 ­ Local community retailers will grow. Trend #3 ­ Non-store retail environments will grow. Trend #4 ­ The lines of competition will continue to blur between types of retailers. Trend #5 ­ The lines of competition will increasingly blur between retailers and manufacturers. Trend #6 ­ Technological advances will allow retailing to become truly consumer driven.

The bulk of the book is an analysis of each of these trends, using a standard approach: first an analysis of the trend, followed by a discussion of the emerging trend (i.e. where it is expected to go in the immediate future), then a description of how consumers will change in response to the trend, and finally some direction for companies on how to capitalize upon the trend ('Directions for Trend Leveraging'). Generally, the analysis is straightforward and logical, with few surprises.

The last chapter in the book, and the Appendix, discuss methods of marketing profitably to Œtomorrow¹s consumer¹. Roberts identifies nine traits of tomorrow¹s consumer, that will characterize the ways in which they make decisions about products and services. These are:

1. far less homogenous
2. independent thinkers who seek control over their lives
3. more educated and sophisticated
4. pursuers of a higher quality of life
5. extremely demanding
6. optimistic, but well grounded in reality
7. seekers of new experiences and innovation
8. pursuers of wellness and environmentalism
9. ageing, but more active

In response to these nine characteristics, she also identifies nine ways in which consumer-oriented companies should be re-organizing themselves in order to ensure they are aligned to these consumer traits. These are:

1. restructure organizations with a consumer-driven focus
2. select and focus on the highest-priority consumer segments
3. develop standardized customization approaches
4. leverage global trends and market intelligence
5. increase the priority on innovation
6. increase the priority on value
7. choose more narrowly targeted and two-way communications vehicles
8. align communications vehicles with the spirit of tomorrow¹s consumers
9. adopt new marketing research approaches to understand tomorrow¹s consumer

Navigating the Future presents a straightforward method of reviewing the evolving environment for consumer goods and services, and provides a sound starting point for analysis. While 'econographics' is not likely to become a household word or a standard tool in the business, Roberts¹ approach does make fundamentally good sense.

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THE TCI MANAGEMENT CONSULTANTS RATING: * * * *

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