Hot Trends to Explore

Consumer Trends

Consumers are thinking about this stuff--and you should be, too.

Environment: From driving hybrid cars and building with earth-friendly materials to recycling electronics like cell phones and computers, consumers are becoming steadily more interested in all things green. In a recent poll of American parents from The Center for a New American Dream, nearly 88 percent of respondents said they would likely purchase environmentally friendly products if they were avail-able at local stores. And Consumer Reports recently launched a website to educate consumers on environmental issues:

Outsourcing everything: Not just for corporate back-office duties anymore, outsourcing is now a consumer prerogative for personal duties, too. Parents, for example, can now outsource traditional parenting chores--like potty-training or teaching kids to ride a bicycle--to professional service firms. Paul Parkin, a marketing and consumer-behavior expert and creative director of Salt Branding in San Francisco, notes this trend likely stems from time demands on working parents. Parkin notes that savvy marketing will help you convince parents you're providing the very best service--and win customers. --N.L.T.

Turn On and Tune In
Already have a business? You need to be aware of these trends.

1. Interactive self-service: Self-service kiosk purchases accounted for $247 billion in transactions in 2003, while self-checkout racked up nearly $124 billion. Bob Robicheaux, chairman of the department of management, marketing and industrial distribution at the University of Alabama, says that while some decry the lack of personalization, convenience is a good thing. But in cases where salesperson interaction is part of the experience, like the antiques biz, self-service isn't a good option.

2. Radio frequency identification: Wal-Mart has driven the biggest retail-industry change since stores started supersizing: RFID chips. Experts fantasize about the possibilities of RFID, from interactive mirrors that turn into point-of-sale displays to checkout-free shopping. Patrick J. Sweeney II, author of RFID for Dummies, says today's applications are more about inventory management. And Lauren Scott California has developed children's RFID-embedded sleepwear, which will allow consumers to track the locations of their little ones.

3. D é cor-conscious college students: The Trading Spaces generation is off to college--all 16.7 million of them--and they aren't content with cinder-block dorm walls. According to the National Retail Federation, young adults spent a whopping $3.6 billion on dorm furnishings in 2005. The craze is fueled by pop culture, says Ellen Tolley Davis of the NRF: "Students have been watching [home makeover] shows and got the message that it's good to spend money to make your space more comfy." Think affordable desks, beds, chairs and accessories.

4. Biometric payment: Touch here, and your debit card is charged. It may sound like sci-fi, but it's happening in retail now, says Mike Friedman of the Mercator Advisory Group, a payment industry research firm in Waltham, Massachusetts. With biometric payments, funds are usually drawn from the customer's bank account, lowering transaction fees. But acceptance might be an issue, says Friedman: "About 30 percent of people are OK with using their fingerprints, and 30 percent say 'No way.'" Long term, he predicts widespread adoption in some segments like grocery stores.

5. Empty nesters: According to the Census Bureau, the number of U.S. families with no children under 18 will increase by 28 percent, to 46 million, by 2010. They've got cash to spend, and they don't want to cook, says Jim Gilmartin, who heads Coming of Age Inc., a Lombard, Illinois, firm that helps businesses target the boomer market. Bring them in by making your restaurant friendly to aging eyes with good lighting and bigger font sizes on your menu, nixing booths for easier-to-maneuver tables and chairs, and offering healthy options.

6. Mediated shopping: Freedom of choice is getting to us. Sociologists even call our World Wide Web of options "tyranny," so there's opportunity in whittling down the uber-market, says Girish Punj, associate professor of marketing at the University of Connecticut. Mediated shopping--using customization or customer profiles to provide product or service recommendations--is one way to cash in. Use cookies, codes or cards to integrate customer profiles onto your site and in your store. Give customers deals on what they like to buy, says Punj, and you have a winner.

7. Online advertising: Web searches for local info doubled last year, as search engines become the new Yellow Pages. David Hallerman, senior analyst with eMarketer in New York City, says it's important to catch local customers online, either through search engines or links with local sites. No cash to hire a professional? Boost your rank with reciprocal links and on-site repetition of words.--Gwen Moran

Steve Cooper, Amanda C. Kooser, Nichole L. Torres and Sara Wilson are editorial staff members for Entrepreneur magazine. Gwen Moran, Michelle Prather and Karen E. Spaeder are freelance writers. Additional research by Genevieve Jenkins, Sharon Tang-Quan and Jeran Wittenstein.
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This article was originally published in the December 2005 print edition of Entrepreneur with the headline: The Hot List.

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