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Marketing trends and changes.


In today's environment of increased operating costs and lower than usual consumer demand, companies must seek new and flexible strategies to cope with current economic marketing trends and changes.

Retailers and manufacturers should review current operational procedures and existing marketing strategies, and changes should be made with a view towards improving sales and profits.

Many companies do not recognize innovation as a must. They do not change their decor, their products, locations, service, promotions, or their product presentations. Many multi-store chains look the same way they did ten years ago. To be successful, companies must constantly keep abreast of trends and changes. They must conduct surveys among consumers, their suppliers and their employees. They must recognize the consumer's needs and take the initiative prior to their competitor in the same market.

Hot Major Issues Shaping Business Today

* Environmental concerns

* Globalization of markets

* Customer service

* Human resources

Global Marketing

As a result of world markets being made smaller by telecommunications, we will see more trans-border joint ventures, mergers and acquisitions as corporations seek global ties.

NO FRILLS SHOPPING CENTRES: These centres are gaining popularity in the United States and surfacing in Canada. Tenants are retailers, manufacturers and distributors of consumer goods selling their merchandise in this new shopping environment.

WAREHOUSE CLUBS - FACTORY OUTLETS: More warehouse clubs and factory outlets will open in Canada following their success in the United States.

BUSINESS-WITHIN-A-BUSINESS CONCEPT: Convenience stores are in service stations. Dental, medical, optical and insurance services are in department stores and shopping centres, and this trend is gaining momentum. Complete health centres are now growing in popularity.

DESIGNER CLOTHES -DISCOUNT STORES: These stores give image-conscious consumers more value with names they can identify with, by selling designer label clothes.

COUPON MERCHANDISING: The use of coupons is very prevalent: buy your food at the supermarket and get discount coupons for another retail outlet. Buy merchandise at one chain and get discount coupons for a restaurant chain.

FRANCHISING: Though this is not a recent change, there is increased activity in this area in video stores, fast print shops, convenience stores, restaurants, computer stores, variety stores, fast foods, gourmet foods, auto services, one-hour photo finishing. Corporations which traditionally operated their own stores are now franchising more of their in-store departments and, in some instances, their entire store.

GAS STATIONS: Unmanned gas stations will emerge in Canada. You will insert your credit card and then fill up your car.

ETHNIC FOOD: More ethnic foods will be consumed at home due to increased travel by consumers and their introduction to new taste treats in the travels.

HOME COMPUTERS: Home computers will expand their capabilities and will continue to increase their home and business relationship. Many creative people working from home now are on a technology lifestyle wave. An exciting revolution in technology and communications is going to permit many people in the 90's to move into quality-of-life rural areas. Millions of people will move into this lifestyle in North America over the next decade.

DEBIT CARDS: In the near future, consumers will be able to buy merchandise using plastic called a debit card, instead of cash or cheques. A debit card will create an instant deduction from the customer's chequing account. Debit cards are a simple way to pay for merchandise besides cash, cheques, or credit cards. This system is handled by point-of-sale terminals which are situated at the check-out counter in retail stores. Some major U.S. national retailers are now using the system. Customers get a receipt listing all merchandise purchased, date, time and amount withdrawn from their account.

WOMEN IN THE MARKET-PLACE: So many women have left the home for the workplace that the resulting upheaval in society has changed our lives dramatically, and it looks as if this change is a permanent one.

SHOPPING AT WORK: Direct-selling companies are invading offices since a greater percentage of women are now in the work force and not at home. Look for this trend from the U.S. to spill over into Canada.

HARRIED TWO-INCOME COUPLES: Two-income couples will soon be demanding a return to the luxury of home delivery. With husband and wife busy with their careers, time is at a premium. According to recent surveys the single greatest source of stress in the lives of North Americans today is not having enough time.

RETAILING OPPORTUNITIES: There are opportunities for retailers who stand out from their competition by establishing an identity that is distinctive. Consumers increasingly hectic lifestyles are creating distinct opportunities for retailers who are innovators of convenience, retailers must find different ways to satisfy the consumers need for convenient and timesaving shopping experiences. Customers who are unhappy with the service they receive do not complain. They simply go someplace else to shop.

PHONE-IN SUPERMARKETS: Fast, free delivery of supermarket merchandise is now available at phone-in supermarkets - local order assembly warehouses situated in low-cost industrial parks, eliminating the high cost of prime real estate locations, expensive stores, large parking lots, high staff overheads, customer theft, product damage and spoilage. Watch for more activity in this area in the near future.

HIGH-QUALITY GOODS: High-quality goods will make a comeback as consumers increasingly reject mass produced items in favour of custom-made. Affluent baby-boomer parents will buy "posture-perfect" baby strollers, designer children's wear and sophisticated toys.

DRIVE-IN GROCERIES: Supermarkets in California are combating competition with convenience stores, fast food restaurants and huge hyper markets with drive-up windows.

Motorists no longer have to leave their cars to grocery shop. They drive up to a drive-up window for eggs, milk or some of the other 1,400 grocery items, fast food or household goods they require.

SUPERMARKETS - GOING AFTER FINE-FOODS AND THE UPSCALE TAKEOUT TRADE: There is a trend among supermarkets to take back some of the dollars that restaurants and fast food chains have taken away from them over the last few years. Upscale takeout food that is ready to eat will be featured in more supermarkets in the near future. By moving upscale, the supermarkets are challenging the smaller, high end, specialty food stores. The new supermarkets takeout food sections will be quite appealing. Some stores will be enticing their customers the yuppies, cocooners, and couch potatoes - with neon art, gleaming, galvanized metal, skylights, large illuminated murals, carpeting, mirrors and chandeliers. Upscale restaurants will see a decline in sales with the demise of conspicuous consumption by consumers.

DEPARTMENT STORES: As part of a continuing strategy to expand specialty operations, some department stores are entering into exclusive licensing agreements to market specialty products. These agreements offer an opportunity to broaden the department store's customer base, i.e. Sears with McDonalds and with Walt Disney Co. Future plans call for the stores to feature a variety of activities for children such as story hours, a puppet theatre and a computer learning station.

DEPARTMENT STORE SERVICES: There are hundreds of spas in department stores in the United States. Customers enjoy manicures, pedicures and massages during a shopping trip. Macy's has 40 in-store spas across the country. In Tokyo you can enjoy scuba-diving lessons in the basement and a golf driving range on the roof.

HOME SHOPPING AND DELIVERY: This new interactive technology enables consumers to shop from a televised catalogue of products. Consumers send automatic commands to a central computer using the keys of ordinary telephones. With both husband and wife busy advancing their careers, there's no time left for necessities. Home shopping over cable TV or home telecommunications systems will thrive in the years to come.

CUSTOMERS CAN PAY BILLS BY TELEPHONE: Experiments in electronic funds transfer services is bringing bill payments as close as a customer's telephone. Customers can tell the service company which accounts they want eligible for payment. It is possible to pay major credit cards, many oil company cards, department store, hydro, telephone and cable bills. The customer can dial any time of the day or night, once registered. For each bill paid, the service company charges fifty cents. Once connected to the service company, the customer dials or punches in a private security code. A recorded voice asks which accounts one wishes to pay. Accounts are identified by designated digits and the amount to be paid is keyed or dialed in.

THE GRAYING OF NORTH AMERICA: As a result of medical breakthroughs and declining birthrates, people over 65 now outnumber teenagers for the first time ever in North America. This gap will grow larger as the baby-boom generation grows older. By the year 2000, forty per cent of adults will be over 50. These demographic trends will have enormous consequences for business in the years to come. There is no industry, service, or product that will be untouched by the demands of the aging consumer and therein lies opportunity. People who retire in the 1990's and beyond will not be like previous generations of retirees. In general, they will be in better health, have more money and have a higher level of education. The age of 65 no longer means a move from work to the rocking chair.

"Woopies", or well-off older people, represent a very attractive market. They tend to be active and they tend to have money. Contrary to past stereotypes, the over 50 customer is interested in new products - in fashion and in automobiles. They want to spend on products and services. "that enhance their personal enjoyment of life." The mature consumer shares many similarities with the younger consumer in the 39 to 49 age group.

This market has a surprisingly large disposable income and is known for travelling quite frequently. They play tennis; they play golf. They are retiring with a certain degree of affluence. They buy home furnishings, go to restaurants and they like plenty of entertainment.

Cosmetic companies, furniture and appliance manufacturers, automobile dealers, food companies, clothing retailers and travel agencies should pay more attention to the 50-plus group as its numbers increase. Companies that design and are marketing new products or adapting their existing products to the senior marketplace and their needs will profit in the future.

SENIOR OPPORTUNITIES: As employers pursue workforce flexibility and reduce benefit commitments by contracting out and hiring part-time help, there are opportunities for the senior labour market. There are vast numbers of seniors who are not ready to move to the rocking chair as yet.

These seniors are finding new opportunities with companies requiring temporary help as more and more companies are downsizing. The graying population presents a great opportunity that has been virtually untapped.

SMART HOUSES/SMART APPLIANCES: In the future it will be possible to phone any electrical device in the smart house.

A single cable will distribute power, telecommunications and audio/video signals, eliminating separate wiring for cable TV, phones, stereo speakers, alarms and appliances. Smart appliances for smart houses communicate with one another. The microwave can deliver a message on the television to inform you your dinner is ready.

The smart house has been under development in the U.S. since 1984, sponsored by the National Association of Home Builders and several high-tech and appliance companies.

TOMORROWS CHANGES: What will tomorrow's many marketing changes bring? Are you and your company prepared to meet the challenge?

Allan Cohen, Internationally-known management consultant, is principal of Allan Cohen & Associates Ltd., a Toronto-based marketing and management consulting firm since 1967.
COPYRIGHT 1990 Canadian Institute of Management
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1990 Gale, Cengage Learning. All rights reserved.

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Author:Cohen, Allan
Publication:Canadian Manager
Date:Dec 22, 1990
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