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A BRAVE NEW CONSUMER WORLDJOHN GERZEMA | STORE 2012Copyright 2011, John [email protected]: @JOHNGERZEMA
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TWITTER @JOHNGERZEMA
Copyright 2011, John Gerzema2
A BRAVE NEW CONSUMER WORLD JOHN GERZEMA | STORE 2012
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema3Source: Flickr, Eric Fischer
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema4
Boy Scouts debut Badge in Robotics
POWER HAS SHIFTED TO CUSTOMERS AS TECHNOLOGY BECOMES CULTURE
6,600+NEW PICTURES ARE UPLOADED
ON FLICKR
100+
NEW LINKEDin ACCOUNTS
12,000+ NEW ADS POSTED
ON CRAIGSLIST
13,000+ HOURS MUSIC
STREAMING ON PANDORA
98,000+TWEETS
ON TWITTER
694,445SEARCH QUERIES
20,000+ NEW POSTS ON TUMBLR
13,000+iPHONE APPS
DOWNLOADED
370,000+MINUTES CALLS
ON SKYPE
70+DOMAINS
REGISTERED
1,600+READS ON
SCRIB’D
Copyright 2012, John Gerzema | BAV Consulting | WPP PLC5
EVERYSECOND
Source: Go-Globe.com
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
TECHNOLOGY, BY THE NUMBERS...
Web economy 'to double by 2016' |Americans spend 100K years on Facebook each month | More Americans are on Facebook than have a passport | A gamer is three times more likely to be an adult woman than a minor male |48 hours of footage uploaded to YouTube every minute | More U.S. adults own a smartphone than have a college degree | Apple Makes 75% of Profits, With Only 9% of the Phones | Half of US twenty-somethings have no landline | 28% of US smartphone owners use them as primary net connection | One Billion smartphone sales per year by 2016 | U.S. Has More Wireless Devices than People | Mobile Payments To Triple To $670B By 2015 | Avg. US households receive a personal letter only once every 7 weeks
6 Source: Pew Center. Juniper, NPR, U.S. Postal Service, Forrester, BAV Consulting
Copyright 2012, John Gerzema | BAV Consulting | WPP PLC7
SMARTPHONES: A LOVE AFFAIR
Copyright 2012, John Gerzema | BAV Consulting | WPP PLC8
Copyright 2012, John Gerzema | BAV Consulting | WPP PLC9
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
THREE FORCES AS CATALYSTS
10
A BRAVE NEW CONSUMER
WORLDCHANGINGMERCHANTDYNAMICS
TECHNOLOGYADOPTION
CHANGING CONSUMER DYNAMICS
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
CHANGING CONSUMER DYNAMICS
11
A BRAVE NEWCONSUMER
WORLD
CHANGINGMERCHANTDYNAMICS
TECHNOLOGYADOPTION
CHANGING CONSUMER DYNAMICS
YOUNGER CONSUMERS
GLOBALPROSPERITY
• By 2020 31% of the world’s population will be under the age of 351
• 40% of Canadians will be under the age of 35 in 20202
• Half of US 20-somethings have no landline3
• By 2030, 2/3 of the world’s population could be middle class4
• BRICs could account for 50% of global equity markets by 20505
• Single largest transfer of wealth in American history6
1 Infosys, 2 2012 U.S. Census Bureau, International Programs: International Population Projections 2020, 3 FCC June 2011 4 Brookings Institute 2010, 5 Goldman Sachs Global Economics 2009, 6 PEW Center 2011
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
CHANGING MERCHANT DYNAMICS
12
A BRAVE NEWCONSUMER
WORLD
CHANGINGMERCHANTDYNAMICS
TECHNOLOGYADOPTION
CHANGING CONSUMER DYNAMICS
MINDFUL SHOPPING
PERSON TO PERSON (P2P)
TRANSACTIONS
• 52% of Canadian online adults prefer to research a product online before purchasing1
• 43% of US retail sales are influenced by the web1
• 44% of US consumers reported 1+ P2P fund transfer in 2009, expected to rise to 61% in 20142
• 2010 P2P transfers totaled $7 billion, with substantial growth expected in coming years2
• 4/10 mobile bankers made a mobile P2P transfer in 20102
1 Delv/Nia Survey 2010, 2 Javelin Strategy & Research, 2011
• 5 Billion mobile phones in use in 20101
• 45% of all Canadian adults have Smart Phones3
• 10.3 Million US Adults will own tablets in 2010 rising to 82 Million in 20153
• Mobile banking customer base to reach 1.1 billion by 20155
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
TECHNOLOGY ADOPTION
13
A BRAVE NEW CONSUMER
WORLD
CHANGINGMERCHANTDYNAMICS
TECHNOLOGYADOPTION
CHANGING CONSUMER DYNAMICS
EXPANSION OF THE INTERNET
DEVICE PROLIFERATION
• 2 billion people are connected to the internet; 200 million more each year1
• $8 Trillion exchange hands each year through ecommerce1
• The internet accounted for 3.4% of the GDP in 13 countries and 21% of the GDP in mature markets over the past 5 years1
• 28% of smartphone owners use them as their primary net connection2
1 McKinsey Global Institute 2 ARS Technica, 2011 3 comScore, 2012 Canada Digital Future in Focus Report 4 Global Industry Analysts 2.0
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
THE WORLD’S MOST EXTENSIVE STUDY OF CONSUMERISM: BRAND ASSET VALUATOR®
WORLD’S LARGEST DATABASE OF BRANDS
ACADEMIC REVIEWED
17 ANNUAL STUDIES COMPRISING 78% GLOBAL GDP
800,000 CUSTOMERATTITUDES, PERCEPTIONS AND VALUES
50,000 BRANDS
275 STUDIES IN 51 COUNTRIES
QUARTERLY U.S. PANEL OF 17,000 RESPONDENTS
$ 130 MILLONINVESTED WITH DATA BACK TO 1993
14
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
TRAVELING THE GLOBE IN SEARCH OF THE BRAVE NEW CONSUMER WORLD
15
SAN FRANCISCO
ST LOUISTOKYO
SHANGHAI
NAIROBI
THIMU
BEIRUT
TEL AVIV
AHMEDABADPARO
REYKJAVIK
BERLINLONDON
BRUSSELS
STOCKHOLM
MEDELLÍN
LIMA
NEW YORK
JERUSALEM
BOGOTÁ
KOLKATA
ATHENS
Copyright 2011, John Gerzema
BRAVE NEW CONSUMER WORLD #1 CURRENCY GETS CURRENT
16
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema17
TIM KUNDEFOUNDERFRIENDSURANCEBERLIN
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema18
MARIA DAMANKIEUROPEAN COMMISSIONERMARITIME AFFAIRS AND FISHERIESBRUSSELS
ANNA PEARSONFOUNDER: SPOTS OF TIMELONDON
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema19
“ EBAY BUYS ZONG FOR $240 MILLION IN CASH TO BOOST PAYPAL’S MOBILE PAYMENTS TECHNOLOGY.”
— TechCrunch
“ VC’S INVESTED $834 MILLION IN SCORES OF FIN-TECH FIRMS IN 2008 AND $1.4 BILLION IN 2011, UP 75% FROM LAST YEAR .”
— CB INSIGHTS
“ AN ADULT FEMALE IS 3X MORE LIKELY TO BE A GAMER THAN A YOUNG MALE.”
— Ars Technica
“ NFC PAYMENTS TO GENERATE $50 BILLION IN 3 YEARS.”
— Mobile Payments World
“MOBILE PAYMENTS TO TRIPLE TO $670B BY 2015; DIGITAL GOODS WILL REPRESENT 40% OF TRANSACTIONS.”
— TechCrunch
“MOBILE PAYMENTS TO REACH 2.5B USERS GLOBALLY BY 2015.”
— Mobile Commerce Daily
“TWO MAJOR INDIAN OPERATORS HAVE ANNOUNCED PLANS TO PURSUE MOBILE BANKING INITIATIVES.”
— Mobile Payments World
“INDIAN MOBILE BANK EKO RAISES$5.5 MILLION, PROCESSING $270 MILLION IN PAYMENTS A YEAR.”
— TechCrunch
“24% OF MOBILE USERS BANK FROM A PHONE.”
— Mobile Payments World
“WHY MOBILE PAYMENTS CAN'T COME SOON ENOUGH.”
— CNN Money
“STARBUCKS CONTINUES TO BLAZE M-PAYMENTS TRAIL.”
—Mobile Payments World
“PAYPAL PREDICTS THE END OF THE WALLET BY 2015.”
— Slashdot
“MOBILE GAMING TO SURPASS CURRENT CONSOLES.”
— Slashdot
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema20
MOBILE COMMERCE IS RESHAPING THE MARKETPLACE
Copyright 2011, BrandAsset Consulting/Young & Rubicam21 Source
Copyright 2011, BrandAsset Consulting/Young & Rubicam22
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema23
Copyright 2012, John Gerzema / BrandAsset Consulting /Young & Rubicam24
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema25
Copyright 2011, John Gerzema
BRAVE NEW CONSUMER WORLD #2CINDERELLANOMICS
26
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema27
VINAY GUPTA AND TOM WRIGHTC0-FOUNDERSWHIP CARLONDON
MARIA ZIVDIRECTOR OF THE GOVERNMENT OF SWEDEN TOURISM BOARD@SWEEDEN STOCKHOLM
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema28
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @JohngerzemaSource: USA BAV All Adults Q1 2012
CINDERELLANOMICS: WANT LESS, RENT MORE
29
Since the recession, I realize I am
happier with a simpler,
more down-to-basics lifestyle
Because of the recession, I shop less often than I used to
66% AGREE 67% AGREE
Copyright 2012, John Gerzema | BAV Consulting | WPP PLC30
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema31
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema32
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema33
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema34
Copyright 2011, John Gerzema
BRAVE NEW CONSUMER WORLD #3 REPUTATION.ME
35
ÖRN BáR⇥UR JóNSSONCONSTITUTIONAL COMMITTEE MEMBERREYKJAVIK
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema36
IJAD MADISCHCEO/CO-FOUNDERRESEARCHGATEBERLIN
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema37
GILES ANDREWSFOUNDERZOPALONDON
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema38
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema39
WITH TECH LEADERS, TRENDINESS AND ARROGANCE GO HAND-IN-HAND
02 04 06 08 09 10
100
75
50
25
002 04 06 08 09 10
100
75
50
25
002 04 06 08 09 10
100
75
50
25
0
GOOGLE APPLE FACEBOOK
TRENDYUNAPPROACHABLEARROGANT
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema40
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema41
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema42
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema43
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema44
Copyright 2011, John Gerzema
BRAVE NEW CONSUMER WORLD #4GAMING YOUR LIFE
45
GRANNY HOLLYPARTNER: GRANNIES, INC.BANBURY, U.K.
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema46
KENTARO OHARAFOUNDERCOLISHTOKYO
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema47
Copyright 2012, John Gerzema | BAV Consulting | WPP PLC48
Copyright 2012, John Gerzema | BAV Consulting | WPP PLC49
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema50
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema51
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema52
Copyright 2011, John Gerzema
BRAVE NEW CONSUMER WORLD #5 THINKING OUTSIDE THE (BIG) BOX
53
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
NING LICO-FOUNDER:MADE.COMLONDON
54
ERIKO YAMAGUCHIFOUNDER: MOTHERHOUSEBANGLADESH AND TOKYO
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema55
LEO RISKICULTURAL ATTACHEFINDLANDTHE FELLESHUSBERLIN
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema56
´
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @JohngerzemaSource: USA BAV All Adults FY 2011-Q1 2012
BEYOND BRICK AND MORTAR, OR ‘STORE AS WI-FI’
57
63% DISAGREE
WHERE A BRAND IS SOLD INFLUENCES HOW I FEEL ABOUT A
BRAND
10
12
14
16
18
20
22
24
26
2007 2010 2011
BRICK & MORTAR RETAIL
INTERNET RETAIL
“TRUSTWORTHY” 2007-2011: BRICK & MORTAR VS. INTERNET
RETAILERS
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema58
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema60
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema61
Copyright 2012, John Gerzema | BAV Consulting | WPP PLC62
Copyright 2011, John Gerzema
WHERE THESE TRENDS LEAD US: A BRAVE NEW CONSUMER WORLD
63
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @JohngerzemaSource: USA BAV All Adults FY 2010-Q2 2011
RETAIL BRANDS ACROSS CANADA FACE MORE COMPETITION IN THE BRAVE NEW CONSUMER WORLD
64
Use Regularly Use Occasionally
-12% 15%
One I Prefer One Of Several
-8% 13%
WHILE TOTAL USAGE AND PREFERENCE HAVE INCREASED
STRONG LOYALTY TO SPECIFIC BRANDS IS DECLINING
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
THIS IS BECAUSE THERE ARE FEWER BRANDS PEOPLE TRUST, MAKING TRUST ACT AS A PRECIOUS COMMODITY
65
PERCENT OF TRUSTWORTHY
BRANDS
2001
49%
2001
29%
2009
25%
2009
45%
CORRELATION OF TRUST TO FUTURE POTENTIAL
(BRAND STRENGTH)
50
40
30
20
10
0
Source:
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
PERCENT OF PERFORMANCE BRANDS
CORRELATION TO GUEST SATISFACTION
PRE PREPOST POST
100%
50
0
1.0
0.5
0.0
73% 0.6847%
0.82
Source: USA and Canadian BAV All Adults (Trustworthy brands defined as those with greater than 20% attribution)
FEWER BRANDS ARE DELIVERING PERFORMANCE, WHICH DRIVES SATISFACTION AND LOYALTY.
66
CONSUMER
0.2 0.0 0.2 0.4 0.6 0.8 1.0
KNO
EST
REL
DIF
0.2 0.0 0.2 0.4 0.6 0.8 1.0
KNO
EST
REL
DIF
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
A LESSON TO PRICE-DRIVEN RETAILERS: VALUE DOES NOT EQUATE TO DIFFERENTIATION
67
WORTH MORE, THOUGH NOT AS STRONGLY CORRELATED TO KNOWLEDGE AND RELEVANCE GROWTH, DOES A BETTER JOB DRIVING ESTEEM
AND DIFFERENTIATION.
GOOD VALUE DRIVES RELEVANCE AND ESTEEM, BUT IS NEGATIVELY CORRELATED TO
DIFFERENTIATION, THE KEY DRIVER OF CURRENT AND FUTURE BRAND VALUE.
POSITIVE CORRELATION
NEGATIVE CORRELATION
Source: BrandAsset Valuator, 2012
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
IN BRAND VS. PRIVATE LABEL PRICE ALONE ISN’T DRIVING BRAND CHOICE
68
“I PREFER TO BUY NAME BRANDS WHEN AVAILABLE INSTEAD OF STORE BRANDS.”
14% INCREASE IN AGREEMENT FROM Q4 2011 TO Q1 2012
ENERGIZED DIFFERENTIATION PRIVATE LABEL VS. BRAND NAME
80
60
40
20
020092008 2011
DIF
FE
RE
NT
IAT
ION
PRIVATE LABEL
BRAND NAME
45% INCREASE IN DIFFERENTIATION GAP FROM 2009
Source: BrandAsset Valuator, 2012
CH
AN
GE
IN
TR
US
T(P
erc
en
tag
e)
PERCENTAGE CHANGE IN BRAND STRENGTH(Future Potential)
35
30
25
20
15
10
5
0 20 30 4010
SOCIAL MEDIA
SPONSORED EVENTS
WEBSITETELEVISION
MAGAZINESNEWSPAPERS MOBILE
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
THE POWER OF ‘SOCIAL AS BUSINESS MODEL’.
69 Source: BrandAsset Valuator 2012
BR
AN
D S
TR
EN
GT
H(E
ne
rgiz
ed
Dif
fere
nti
ati
on
/ R
ele
van
ce)
BRAND STATURE(Esteem / Knowledge)
FOX NEWS
INTERNET SEARCH
INTERNET PORTAL
MSNBC
WSJ
CNBC
SOCIAL MEDIA
2008 2010
INTERNET TOOLS AND SERVICES INTERNET
COMMERCESERVICE
THE NEW YORK TIMES
THE NEW YORKER
INTERNET NEWS/INFO
ESPN THE MAGAZINE
FINANCIAL TIMES
100
50
0 10050
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
WHILE NON-INTERACTIVE MEDIA HAS DECLINED
70 Source:BrandAsset Valuator 2012
2
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
ULTIMATELY STRONG CUSTOMER-CENTRIC BRANDS BREAK AWAY FROM THEIR CATEGORIES
71
BR
AN
D S
TR
EN
GT
H(E
ne
rgiz
ed
Dif
fere
nti
ati
on
/ R
ele
van
ce)
BRAND STATURE(Esteem / Knowledge)
COMPUTERAVERAGE
AUTOAVERAGE
INTERNETCUSTOMER
RETAIL AVERAGE
ALL ADULTS 2011
AIRLINE AVERAGEHOTEL
AVERAGE
100
50
0 10050
Source: BrandAsset® Valuator USA, All Adults, 2011
Copyright 2012, John Gerzema | BAV Consulting |WPP PLC | @Johngerzema
TWITTER: @JOHNGERZEMA
72