By J. Walker Smith, Executive Chairman, Kantar Futures
Join J. Walker Smith, one of America’s leading analysts on consumer trends, on Day 1 (Wednesday, June 28) of The Re-Think Conference at 1:45-3:00. He'll present "Smaller Worlds: The Importance of Home in the New American Scene and take a strategic look at the new implications for community and home.
People want no less than ever before. They just don’t want all of the baggage that used to come with it. Four words sum up this new consumer mindset: Live large. Carry little.
For one thing, many people can no longer afford to shop and buy like before. Headlines about stagnant incomes and populist discontent are a pertinent reminder that for most people affordability remains top of mind. In particular, people are rethinking financial obligations, debt in particular, as they look for ways to unburden themselves of financial baggage.
The bigger dynamic at work, though, is technology. The future of consumption is access not ownership. This is what technology is bringing to people’s lives. It is apparent in several ways.
The on-demand business model, or the ‘Uberization’ of everything, is steadily transforming options and expectations. Established transportation networks, home designs, green spaces, retail planning and more are built on vanishing presumptions about shopping and consumption. If technologies make on-demand as convenient and as affordable as ownership, then people will be freed from the baggage of stuff that has weighed them down. In turn, this will allow people to reconfigure the physical layout of personal and communal spaces.
Virtual reality and augmented reality are ratcheting up the intensity of life. People want more immersive involvement with places and spaces. Smart devices and wearables are rapidly giving way to an interconnected network of sensors and environmental enhancements designed to reengineer reality and relationships. Immersive sensorial experiences are near at-hand. They promise participation in life and the marketplace that is more about being in the moment than accumulating more stuff.
AI and predictive algorithms to anticipate people’s needs diminish the necessity of having things in store for when the need arises. People will put less priority on spaces for perishables or seldom-used belongings. Just-in-time will take away the baggage of stocking up or standing in line.
The mindset of ‘live large and carry little’ is materializing rapidly. Demographic changes are accelerating the rate at which it is unfolding. Boomers have reached the age at which people downsize. The big lives that Boomers have always craved now come from owning less not from owning more.
At the other end of the consumer timeline is a generation of Millennials in their thirties and early forties. They are in the lifestage of greatest interest to marketers, and thus they have taken possession of the marketplace. But they are not a generation that will consume like Boomers before them. They are not as sound financially as Boomers were at their ages. Nor are they as interested as Boomers were in tying their identities and aspirations to possessions and belongings.
On average, Millennials are marrying for the first time nearly a decade older than Boomers. They are a generation of young singles. Boomers were a generation of young parents. In the most fundamental way, Millennials are unencumbered of the commitments and necessities that tied Boomers down when they were that young. By definition, as it were, Millennials carry little. But they have not relinquished the ambition of living large.
What makes the marketplace tick in this new landscape of economics, technology and demographics is access not ownership. That’s how value will be created and realized. That’s what consumers are looking to buy. That’s where the future of consumption will be found.
Check out the other articles in our 2017 Trends Series:
Kantar Futures is the leading global foresight and futures consultancy. We are a team of consultants, researchers and futures experts who use futures techniques and cultural foresight to help our clients “Profit from Change". We offer a range of research and consulting solutions and subscription services. Kantar Futures is a Kantar company within WPP, with teams located in Europe, North America, Latin America and Asia.