Market Trends February 2017
Generation Z, typically defined as people born in 1995 or later, is the first generation to grow up online; they don’t know a world before cellular phones, smartphones and other digital devices. However, 67% of Gen Zers surveyed said that they shop in a brick-and-mortar store most of the time, and 31% shop in a physical store at least some of the time, according to a new survey by IBM and the National Retail Federation. Regardless of where they shop, Gen Z is demanding. According to the study, 52% of Gen Z consumers will switch brands if their current brand does not meet their quality expectations. They value the basics, with 67% saying that product quality and availability are the most important factors when choosing one brand over another. The Global Gen Z population is expected to reach 2.6 billion by 2020. Gen Z consumers also have no patience whatsoever for unwieldly technology; they want it to be seamless and easy to use. Sixty-two percent will not use apps or websites that are hard to navigate and 60% will abandon ones that are slow to load. A full 73% use their phones primarily to text and chat socially, but many are willing to develop brand relationships. Forty-two percent would participate in an online game for a brand campaign and 43% would participate in a product review. Fewer than 30% are willing to share health and wellness, location, personal life or payment information; 61% would feel better sharing personal information if they knew it would be securely stored and protected.
55+ HOUSING TRENDS
The 55+ housing segment should strengthen over the next decade as the baby boomer generation ages and looks to downsize or relocate, according to a new report by the National Association of Home Builders based on data from the American Community Survey. In their new homes, this buyer segment is interested in single-level floor plans within an overall smaller footprint, but still wants space to accommodate family and guests. They're also interested in energy efficiency, amenities and a walkable lifestyle with nearby social activities. Many of these buyers are downsizing and relocating within their existing community.
AMERICANS NOT MOVING AS MUCH
The percentage of Americans moving each year has fallen by more than half from fifty years ago, and is down substantially from the 1990s. With few exceptions, people tend to stay put during hard economic times, and relocate when the outlook is brighter.
KITCHEN AND BATH REMODELING TRENDS
Approximately 24.4 million households remodeled a kitchen or bath in 2015. Roughly one out of every 10 households (about 10.2 million) undertook a kitchen remodel or replacement project in 2015, and two-thirds of them hired a professional remodeler for the work, the National Kitchen & Bath Association said in a new study released in January 2017. The study also found that about 13% of all households (about 14.2 million) undertook a bathroom remodel or replacement project that same year; they hired a pro 58% of the time. As expected, age played a factor in whether customers were more likely to do the project themselves or hire a pro. Among baby boomers (generally those born from 1946 to around 1964), 82% hired a remodeler for a kitchen project and 63% did for a bath job. People in generation X (1965 to 1980) hired a pro 68% of the time for kitchen work and 63% of the time for bath jobs. Mature millennials (those 25 to 37 years old, born between 1980 and 1992) hired a remodeler for 65% of the kitchen jobs and 52% of the bath jobs. Younger millennials (those 18 to 27 years old, born between 1980 and 1999) hired a pro for 60% of kitchen projects and 62% of bath jobs. Nearly half of the kitchen projects were budgeted at $15,000 or more, while 21% of those who responded spent $7,500 or more to remodel their master bathroom.
PERSONALIZED WEB SHOPPING
Retailers are increasingly turning to technology to help them draw in customers, according to a recent article in the Wall Street Journal. Personalization is one of the techniques coming to the forefront. Sunglass Hut employs deep learning and image-recognition technology from Sentient Technologies that uses image recognition to show a shopper styles similar to the sunglasses they are viewing, rather than predicting what the person might want based on what other people have purchased. One Italian company used the technology to test the effect of things like changing the color of the Buy button and the words on their banner and ultimately was able to tailor the website to individual customers based on the advertising image the customer clicked on to get to the site. All the moves they made ultimately increased their web revenues by 38%.
THE FUTURE OF RETAIL STORES
Physical stores will become more synced with shoppers’ smartphones, and will automatically identify people when they walk in the store (unless they opt out), and will offer them unique information and deals tailored to their needs and purchasing history. New and faster ways to pay will become the norm. Physical stores will always be the only place a customer gets instant gratification and stores are experimenting with ways to enhance the emotional rewards of shopping in a store. Robots have the potential to replace sales assistants, and give customers a feeling of greater control; research shows that some people feel intimidated by sales people, and like the idea of a robotic sales assistant whose only job is to serve them.
ROBOTS RULE CES
Robots were the stars of this year’s Consumer Electronics Show (CES) in Las Vegas. Robots were on display that made coffee, folded clothes, turned the lights on and off, played music and of course answered questions and provided a steady stream of information. Robot manufacturers can now create personal assistants that actually understand you; Hanson Robotics will introduce its $299 Einstein robot this spring. Manufacturers also say they are doing their best to create robots that “care” about people and their tasks, and intelligently learn what their owners want. Tech experts say that it’s important for the robots to forge positive relationships with the humans in order to avoid a real-life version of all those sci-fi movies where the robots go berserk and try to wipe out the humans and take over the world.
DIGITALIZATION TRANSFORMING CONSTRUCTION
Mobile tools like smartphones, tablets and laptops are transforming the way construction businesses handle data and help make complex information from blue prints to supply lists available where and when it’s needed. By using cloud-based project management systems, mobile WiFi hotspots and providing project managers, superintendents, lead tradesmen and field personnel standardized devices, companies can insure that everyone is literally on the same page. Industry analysts say that digitalization and increasing mobility could help construction companies save substantial amounts of money as well as save time during both design and construction phases.
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