Changing American Lives MPA Retail Conference March 19, 2002

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Changing American LivesMPA Retail
ConferenceMarch 19, 2002
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The Events of September 11th Affected Us All in
Many Ways
For my generation, it was added to other
defining moments that have profoundly altered
our most basic assumptions and perceptions
regarding the world around us.
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For our children, it stands alone as an event
that will ensure that they never again feel the
same level of safety and security that they
previously had been fortunate enough to take for
granted.
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Nonetheless, these cataclysmic events have done
much to strengthen us as individuals and as a
nation. They have

• Challenged our ethnocentricity
• Caused us to reassess our priorities
• Caused us to become better informed
• Motivated us to reach out to others

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• These events have united us in our fears and
  in our hopes for a better and safer tomorrow.

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They have also affected

• Our most basic values
• The way we spend our time
• The products we buy
• The trips we take
• The media we consume

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Changing American Lives Changing Media
Preferences
To monitor these changes, in September McPheters
Company and Beta Research initiated a tracking
study
that will run through 2002.
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Today

• Highlights of the major trends affecting our
  society
• Implications for the future

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Strength in Community Increased Reliance on Faith

• More time with family and friends
• Especially among those under 35
• More time at home
• Increased reliance on their faith
• More positive attitudes towards work

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Increased Connection With Family, Friends, and
Home
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The Workplace

• Slight decrease in time spent working at office
• More positive attitudes towards their company and
  their job
• I appreciate my job more
• My company handled the crisis well

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Some Leisure Pursuits Have Become More Important
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Others Have Been Curtailed
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Shopping Has Declined Across Many Channels
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We are overcoming our fear of flying. While

• 31 are afraid of flying
• 34 will travel less
• 25 will select different destinations

all are down significantly in the last few months.
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Spending Investments

• 52 are more careful with their spending
• 48 worry more about financial security up from
  39 in previous wave
• 44 have adopted more conservative investment
  strategies

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Changes in Values Priorities

• More appreciative/take less for granted
• More cautious
• More conservative
• More aware
• Better informed
• Especially those under 35

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Changes in Media Usage

• More time spent with all major media
• A much larger proportion of time spent with media
  allocated to news
• Greater interest in international news
• Greatest increase in consumption of news by those
  under 35

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Increased Consumption of All Major Media
Wave II
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Media Effects Have Moderated, But Are Still
Profound
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Increased News Consumption Led By Young
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Implications for the Future
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Consumers will soon start to ease up on their
purse-strings
Implication 1

• Accustomed to prosperity unresponsive to themes
  of self-denial and deprivation
• Strongest among employed and financially secure

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Most, but not all, sectors of the U.S. economy
Beneficiaries
As Americans continue to spend carefully,
retailers and manufacturers offering quality
and value will flourish.
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Spending patterns will reflect increased time
spent at home.
Implication 2

• Will benefit categories like
• Home electronics
• Home improvements
• Furniture accessories
• Kitchen equipment
• Products consumed at home

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BeneficiariesLifestyles more oriented to home
and family will result in a larger proportion of
shopping done from home and will benefit those
marketers who make it easy for buyers to place
their orders online, from the kitchen counter, or
from their favorite chair.
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There will be a trend towards understatement and
comfort.
Implication 3

• Heightened sensitivity concern for the needs of
  others
• Increased appreciation for products that make us
  feel comfortable secure
• Macaroni cheese
• Cashmere
• Insurance

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Beneficiaries

• Providers of things like
• Cashmere down
• Comfort food i.e. macaroni cheese
• Insurance
• Volvo
• Security systems

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Out with the ostentatious, in with the safe,
reliable and familiar!
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Affluent Americans will become a more important
target for marketers, as they account for an
increasing proportion of sales in many
discretionary categories.
Implication 4
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Media that most effectively reach this segment of
the market.
Beneficiaries
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Increases in the audiences for major media will
moderate but will remain significantly above
pre-September 11th levels.
Implication 5
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Interest in news will remain high relative to
past years

• Partially supplanted by
• increased demand for entertainment
• content related to family, relationships, and the
  home
• High demand for financial news

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Advertisers who are prepared to take advantage
of
Beneficiaries

• Larger audiences
• Lower costs
• Reduced clutter

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Increased value will be placed on established
relationships and brand preferences.
Implication 6
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BeneficiariesMarketers who maintain their
advertising presence will benefit at the expense
of those who neglect communications with their
customers.
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Recommended Strategies

• Frequency of contact
• Emphasis on tradition relationships
• Product benefits related to
• Home
• Family
• Safety
• Economy

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Changing American LivesMPA Retail
ConferenceMarch 19, 2002