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Schizophrenic Nation

They're healthy; they're indulgent. They're cynical; they're hopeful. They're having fun; they're working like maniacs. Are today's consumers nuts--or just trying to have it all?
March 1, 1999
URL: http://www.entrepreneur.com/article/17272

At gourmet takeout haven Urban Epicuria, patrons scarf down a whopping 200 pounds of grilled chicken breasts each week. That's no surprise in fitness-obsessed West Hollywood, California. But Wayne Davis, co-owner of Urban Epicuria along with Alan and Gail Baral, lets us in on a dirty little secret: The beef tenderloin is also a hot seller. And the chocolate cake--customers can't get enough. "When we were putting this business together, our investors were skeptical [about us selling rich pastries and other indulgences]," says Davis. "But I told them, `You watch.' People talk about eating healthy--but behind closed doors, it's another story."

Sometimes it's another story in public, too. Allentown, Pennsylvania, restaurateur Iris Konia packs in the local bon vivants at her Federal Grill & Cigar Bar. According to Konia, public indulgence in cigars, premium martinis and aged Angus steaks is not a sign of nutritional Armageddon. "Times are good, and people are feeling expansive," says Konia. "I think it's a reaction to not [indulging] for so long. People are having fun; that's what we're seeing."

Yet, it's not the kind of orgiastic free-for-all we saw in the 1980s. Barbara Caplan, a partner at consumer research firm Yankelovich Partners, puts it this way: "In the '80s, there was no shame; in the '90s, it's no apologies." Indeed, today's consumers are curious and conflicted characters--attracted by luxury but driven by value, knowledgeable about fitness but susceptible to caloric sins. This is the culture that spawned Martha (Stewart) by Mail, a service that packages all the pillowy comforts of gracious living in a no-commitment, hassle-free format.

We are individuals who defy categorization. Los Angeles entrepreneur Erica Courtney, 42, founder of a jewelry company bearing her name, is a good example of the new nonconformity. "I might buy myself a Chanel suit," says Courtney, "but I'd wear the jacket with blue jeans and the skirt with a T-shirt. I do what I like, not what I'm supposed to like."

Attitudes like Courtney's may spell good times for rugged individualists, but what about for entrepreneurs? In a universe where roasted sea bass and crème brûlée are equally desirable--and where paradox reigns supreme--how does the entrepreneur stake a claim? And how did we get ourselves into this strange state of affairs in the first place?


Gayle Sato Stodder is co-author of Young Millionaires Reveal Their Secrets (Entrepreneur Media Inc.).

Mixed Nuts

Whimsical consumer behavior is not a recent development. "I learned a long time ago [when running focus groups] that you're a fool if you expect consistency from consumers," says Myra Stark, senior vice president of knowledge management and consumer insight for advertising agency Saatchi & Saatchi in New York City. "In a focus group, the same consumers will say they believe one thing and, minutes later, say the exact opposite."

Such fickleness may be a symptom of human nature, says Stark. "We get carried away by the moment," she explains. "One minute we hear a compelling argument and are swayed. But the next minute we may be swayed by something else."

In a culture as diverse and evanescent as ours, the potential for new allegiances is nearly limitless. "We live in a society with strong trends and counter trends," Stark asserts. "As a result, we all have contradictory belief systems, and we have to live with that."

The tug of war between trends and counter trends isn't necessarily new, but its current expression is. Today, it's not just diversity between Americans that makes the difference: It's also diversity within Americans.

Courtney sees this diversity every day in her jewelry boutique. "I have customers who come in for a pair of $45 silver earrings one week and return for a $15,000 strand of South Sea pearls the next," she says. "I'm also seeing a lot of young [money-conscious] thirtysomethings spring for nice, expensive pieces as a treat for themselves."

The bottom line: Making assumptions about individual consumers has become nearly impossible. What you see on the surface doesn't even begin to hint at the complexity that lies beneath. That's why, unlike some upscale jewelry retailers, Courtney doesn't try to size up a customer's buying potential by his or her appearance. "It's so ugly for a salesperson to decide whether or not you're a pauper based on how you look," says Courtney.

Ugly, yes, and foolish, too. In today's economic environment, the baby-faced guy in the frumpy coat and jeans just might be a new-media millionaire. The woman in the sweats and sneakers might be an executive on sabbatical. And, as Jim Borsack, 46, co-owner of Las Vegas-based El Portal, a chain of high-end luggage shops, points out, "That guy you don't like the looks of just might be the drummer for Motley Crüe."

Strange Bedfellows

As Americans have become more eclectic in their beliefs, they've also become strangely demanding. The snack food market is one example. Once upon a time, snack foods were universally loaded with fat--in short, they were bad for you. In the fit of piousness that cropped up in the early '90s, a truckload of virtuous, fat-free chips and cookies spilled forth with the promise of guilt-free snacking. Last year, in response to lagging sales, many such snacks--including Nabisco's flagship Snackwell's line--were reformulated to include a little bit of taste-enhancing (you guessed it) fat.

The point? Consumers are no longer willing to take their medicine--if it's bad-tasting. Just a few years ago, the mere notion of a fat-free snack was enough to make people sit up and beg. Today, the same virtuous snack also has to taste good. Really good. The once-acceptable argument that a low-fat snack with a rich, satisfying taste was a scientific impossibility simply doesn't hold water today--and not because science has changed. Consumers simply want--and expect--more.

Susan Mitchell, author of American Generations: Who They Are, How They Live, What They Think (New Strategist), observes that for baby boomers and later generations, the availability of choice and the ongoing race for innovation have created a mentality that anything is possible. "Years ago, you could have a Model T in any color, as long as it was black. Today, people want to build computers according to their own specs and order custom-made Levis," Mitchell says. "Companies have done such a good job of meeting consumers' expectations that expectations are now unreasonable. People expect to get A and B, even when A and B are contradictory."

Naturally, this mind-set establishes a high standard for entrepreneurs. "Customers want what they want, when they want it," says luggage retailer Borsack. "They don't want to be told, `No.' "

So, whenever possible, Borsack avoids the negative. If a store is out of stock on an item, El Portal will offer to ship it to the customer's home in two days. If a customer prefers something he or she saw at another store, El Portal will try to special order it. And for folks who want El Portal's high-quality, high-end luggage at bargain prices, the company now has outlet stores.

Indeed, outlet shopping may be the definitive sport of the '90s. You get good stuff at good prices, which is saying a lot for a retail transaction. Yet, true to Mitchell's observations, consumers aren't always content with the outlet experience either. Often, service is sacrificed. Or convenience is lost as they drive to the outskirts of Nowhere to visit the nearest outlet mall.

Is it unreasonable for consumers to think they can get upscale goods, bargain prices, service, convenience and a twist of fun? Yes. But that doesn't stop New York City entrepreneur Ken Seiff from trying to provide it. Seiff's new Internet apparel business, Bluefly. com, offers a wide selection of high-quality designer-label clothing for men, women and children at 25 to 75 percent off retail prices.

With Bluefly.com, Seiff hopes to quiet all objections to outlet shopping. "Customers don't have to drive two hours to get here, and they don't have to dig through bins to find the right size," he says. "We have a liberal 90-day return policy and a low $3.95 flat rate for shipping." Bluefly.com customers can also create personalized online catalogs that contain only the brands and sizes they want.

With Bluefly.com, Seiff and his team illustrate the flip side to unrealistic consumer expectations. When you harness innovation and unconventional thinking, sometimes you can break new ground. "Wherever you have consumer conflict," Stark points out, "entrepreneurs have opportunities."

Paradoxical You

Consider the typical consumer: besieged by choices; needing more goods at better prices with a range of enhanced, time-saving services; bewildered by change, stress and the opposing pulls of hope and cynicism. It's enough to drive anyone to distraction.

Yet distraction isn't exactly the state we're seeing. Yankelovich partner Caplan believes the simplistic ideologies of the past are toast in today's terms.

Why? It's not simply because we see more, have more or demand more--it's because we know more. And with that knowledge, we've become both sadder and wiser as a culture. "Baby boomers grew up seeing the world in very ideological terms," says Caplan. "Good or evil, black or white--everything was one way or another."

But reality is not so easily defined. In the 1980s and early '90s, we saw wealth, then economic downturn. We embarked on a national mission to exercise, eat well and live healthy lives, only to find that we grew older anyway. "We embrace the idea of balancing work and life, career and family, in some kind of perfect harmony, but that, too, has been elusive," says Caplan. "In the end, we've found we can't have it all. We can only try to manage it. In the process, we've become more willing to accommodate the areas in between [the ideal and the reality]. We're learning to accept a more complicated view of the world."

Complicated, indeed. "We saw [paradoxical thinking] coming onto our radar screens around 1997," says Caplan. "There have been a number of examples since then. People say they're concerned about their kids' nutrition, but they buy their families snack foods in massive quantities. We say we look to the home as a refuge, yet we make the home stressful with multiline phones, faxes, PCs and all the other accoutrements of work. Again and again, we've seen strong findings that people want a return to traditional social values, yet the public has approved in overwhelming numbers the job [President Clinton] is doing," even as they believed him guilty of morally questionable behavior.

Yet, according to Caplan, this isn't hypocrisy. "Nobody's fooling themselves," she says. "They know they're dealing in contradictions, but they see them as a part of life. They're saying, `This is my world, warts and all.' "

On Bread Alone

It might seem like you're dealing with a consumer market so intricate that only a Zen master could decipher its motives. But when you know your customers--when you greet them, seat them, move among them and study them--their desires can be as clear as day. Even if they aren't purely logical.

Konia, for instance, brought in clientele with the allure of exotic cigars, cocktails and an atmosphere of decadence. "They come here for adventure," she says. "But once they taste the food, they want to come back." And since even the adventurous don't always want a cigar with their swordfish, Konia was faced with crowded, smoke-filled dining areas and no place to put the nonsmoking overflow.

So she recently built an upstairs addition for nonsmoking patrons. It's not the crowd Konia expected. But with sales of $1.1 million last year, the success of her venture certainly isn't an unwelcome surprise.

In the end, maybe the best entrepreneurs for this eclectic era are eclectic themselves: bold, imaginative and not so uptight that they wouldn't pair a Chanel skirt with a $20 T-shirt. It's a good time to sell jewelry in the $45 to $50,000 range, as Courtney does. It's a good time to try new and comfortable sales formats, like Bluefly.com's. It's finally time to recognize that even if man could survive on bread alone, that isn't really living.

Let us eat cake.

Contact Sources

Bluefly Inc., (212) 944-8000, http://www.bluefly.com

El Portal, (800) 723-7568, http://www.travelsupplies.com

Erica Courtney Boutique, (323) 938-2850, fax: (323) 938-8964

Federal Grill & Cigar Bar, (610) 776-7600, http://www.federalgrill.com

Saatchi & Saatchi, (212) 463-2000, http://www.saatchi-saatchi.com

Urban Epicuria, (323) 848-8411, fax: (323) 848-8416

Yankelovich Partners Inc., (203) 846-0100, http://www.yankelovich.com