Archive for July, 2008

The Five Drivers Of Teen Buying Behavior: What Marketers Need To Know (Part II)

The remaining three drivers:

3. The message needs to be simple and clear. Teens are accustomed to ease. In their world of technology, everything is at the touch of a button. Marketers need a similar approach. If a marketing message forces a teen to work too hard, or if the pitch isn’t readily digestible, it will fall flat. That’s not to say it must be boring. Rather, it has to be straightforward – and wrapped in an interesting, engaging package. Otherwise, teens will tune out and won’t see the messages being aimed at them.

4. Technology is everything. Other products – jeans, skateboards, skis – are all interesting, but they don’t dazzle and truly excite. Because technology is the focal point of teen existence today – technology is what generates heat. With technology embedded, ordinary items can be magically transformed from also-rans to must-haves.

5. Portability is king for these Technomads. The iPhone is a runaway hit among teens because it is the perfect digital jackknife – phone, texting, music, videos, camera, and web. It’s everything the modern teen needs, with the added bonus of coming in a fashionable, mobile package. Apple’s brilliance is that it squeezed the entire living room experience into the palm of a hand.

Teenagers really can’t afford to drive now

Press of Atlantic City

By REGINA SCHAFFER Staff Writer, 609-272-7211

Published: Monday, July 28, 2008

If Rob Mancinelli takes a little longer to get to his job at Jeff’s Steaks in Egg Harbor Township, it’s because he is driving more slowly – on purpose.

Filling up his 1997 GMC truck costs $85. Not that Mancinelli can remember the last time he did that. He usually puts about $20 at a time in his tank. When he goes somewhere with friends, they try to carpool. Friends agree to give the driver gas money – something that wasn’t as big a deal even a year ago.

“I try to make it last as long as I can,” said Mancinelli, 19, of Absecon. “I drive slower. I’m slower to pull away at a red light. Pulling away quicker, that wastes gas.”

With the price of gas teetering at or above the $4 mark, area teens who typically work part-time jobs are realizing that the discretionary income isn’t quite what they expected when they account for the increasing price of fuel. It means teens are changing their driving and spending habits, holding off on the new Nintendo Wii game to pay for those trips to the mall and work.

Dan Branciforti can go through a couple tankfuls of gas a week commuting from Linwood to his summer job in Avalon, where he peddles ice cream to hot sunbathers on the beach. A round trip to work for Branciforti, according to, costs about $8.50.

He hasn’t “filled up” his 1992 Honda Accord since he started driving it a year ago. His car gets about 21 miles to the gallon.

“I’ll put $20 in it, if that,” said Branciforti, 18.

The cost is catching teens off guard.

“Yes, they are driving less. They have to,” said Gary Rudman of GTR Consulting, a San Francisco-based firm that specializes in market research among teens. “They are on their bikes, scooters and skateboards more as parents have to tighten the screws on the budget.”

Rudman said the problem is compounded by a slipping economy, which means teens are having trouble finding part-time or summer work as those jobs are taken by adults who need the extra income.

“And parents don’t have any extra discretionary income to hand over to their teens,” Rudman said. “So teens are in between a rock and a hard place.”

When pollsters asked teens what three issues concern them most this election year, the No. 1 issue was the price of gas, followed by global warming and the war in Iraq, according to a survey conducted in the spring by TRU, a youth-focused market firm in Illinois.

Mike Castellani, 17, works at Cousins Pizza to put gas in his 1997 Buick Century. Sometimes, his dad will graciously fill the car up for him.

“Twenty dollars will get me about three quarters of a tank, so that’s actually not too bad,” Castellani said as he got gas on Saturday afternoon.

Rudman said some teens are turning to Web sites like Craigslist or eBay more to find the items they want at reduced prices as a result of gas eating their discretionary budget. Or, teens are simply buying less.

“With gas prices and food prices skyrocketing, teens are struggling to figure out where the money will come from,” Rudman said. “These (teens) still crave their expensive technology items – like the new iPhone or the latest video game system – but are having more difficulty raising the necessary funds.”

Mark Battisti works at Linwood Gulf on Route 9 to pay for his gas guzzling 1995 Chevy Blazer. He doesn’t know how much it costs to fill it because he’s never had the money to do that. Now when he goes out with friends, they carpool and share the gas expense.

And the joyride around town? Forget it.

“We hate doing that now,” Battisti said. “It’s a waste of money.”

The Five Drivers Of Teen Buying Behavior: What Marketers Need To Know

Welcome to the GTR Consulting Blog. The goal of this forum is to create a thought-provoking dialogue among marketers about the best way to approach kids, tween, teens, and twenty-somethings –

So what’s the best way to start understanding a market of consumers that can confound even the best marketers? By realizing that today’s teens are the ultimate moving target. Since adolescence, their lives have been a continuous process of adopting and integrating socially impactful technology. To succeed with this unique demographic – increasingly known as The Flux Gen – marketers must understand the five fundamental drivers of the teen psyche and buying behavior.

1. Cool looking technology, or Technobling, is the new badge item. Teens demand style just as much as functionality. Any product marketed to teens must have both. As one 16-year-old boy told us in a focus group, “You don’t want a girl to see you using a lame, old, ugly-ass cell phone.” Gucci, Christian Dior, Chanel – not to mention Nike, Microsoft, Disney, among others – are already hip to that fact.

2. It’s got to be ultra customizable. Teens have a need to personalize almost every aspect of their lives. They’ve come of age in a democratized world that celebrates individual identity. FaceBook, NikeID, cell phone ring tones, Xbox 360 faceplates all provide an opportunity to apply a signature touch. Customization is a way for teens to exert a modicum of control in a world that’s out of their control.

Next Week: Part II outlines the remaining three Drivers of Teen Buying Behavior.

Is frugal the new black?

As down economy sets in, some are embracing the simple life

By Allison Linn

Senior writer MSNBC

updated 7:49 a.m. PT, Wed., July. 9, 2008

To get a sense of the American economy, consider what’s in for summer: house parties instead of bar hopping, thrift stores instead of mall shopping, gardening instead of gourmet restaurants.

Americans have spent the past year or so complaining about the rising price of everything from bread to gas, and bemoaning the ways in which it has changed their lifestyle.

Now, as the reality of a down economy begins to sink in, experts say consumers are starting to embrace the simple life: staying close to home, cooking more, planting a garden and even delighting in bargain hunting. Some retailers, trying to make the best of the situation, have begun looking for ways to latch onto the trend as well.

“Americans as a whole are pretty … adaptable, so when it gets tough, we make it cool to be frugal,” said Anna D’Agrosa, director of consumer insight with Zandl Group, a trend forecasting group.

D’Agrosa has seen a surge of interest in gardening, and especially growing food, as well as shopping at local markets and cooking at home. She’s also seeing more people having fun taking thrift store finds and sprucing them up for a more modern look.

Dinner parties, board games and rental movies are becoming more popular ways to socialize and save a buck, she said, while those who do go out are increasingly opting for dive bars or underground clubs that are cheaper than their higher-end counterparts.

“I think they’re definitely finding ways to make it fun,” D’Agrosa said.

Faced with a tight job market and less discretionary money from their parents, teenagers are often hit early and hard in a down economy. But Gary Rudman, president of GTR Consulting, which tracks the habits of teens and young adults, said this generation of teens is also quick to adapt to new dynamics.

“They’re the first to react, and they figure out how to make it work,” he said.

That doesn’t mean they are willing to give up their favorite brands or gadgets, he said — they’re just figuring out cheaper ways to get those items.

Some are looking for bargains on Web sites like eBay and Craigslist, he said, or opting for lower-end or slightly older versions of gadgets such as phones or iPods. Others are increasingly willing to go to discounters to find coveted brands.

“These guys are looking for any way possible to stretch that dollar,” Rudman said. “They’re very adaptive.”

The obvious challenge for retailers is to get consumers who have decided to go frugal to spend money at their stores anyway.

Retailers already known for bargains, such as Wal-Mart, were among the first to start promoting ways that shoppers can enjoy a pared-down lifestyle. Over the past couple months, the discounter has played up deals on backyard items that can spruce up a “staycation” —staying at home during time off work rather than traveling. In May, it even launched a campaign focused exclusively on making one summertime indulgence — ice cream — more affordable.

Many other retailers have launched similar campaigns. And as high prices and the ailing economy begin pinching even consumers in higher income brackets, brands that aren’t usually associated with bargains are getting into the game as well.

Whole Foods, the upscale grocer often referred to jokingly as “Whole Paycheck,” recently dispatched a group of “value gurus” to offer store tours for customers looking for bargains. Tips include buying house brand items and eating food that is local and in season.

D’Agrosa said some companies could benefit from a push toward frugality.

For example, people who choose to stay at home rather than go bar-hopping tend to buy higher-end liquor because it’s still cheaper than what they would pay at a bar, D’Agrosa said. Online retailers also stand to benefit because they allow customers to save on gas, and lower-priced alternatives such as grocer Trader Joe’s and clothing store H&M also stand to profit.

For frugalists, bargain hunting is a lifestyle

Those who are more practiced at living on less note that, sometimes, the “treasure hunt” of bargain shopping can be fun in and of itself.

While George Reese, 51, admits that it might be nice to get a new car or fill up the tank without a second thought, the lifelong frugal shopper also takes pride in the unexpected deals he finds during his frequent trips to discount stores. The other day, the Ventura County, Calif., resident was pleasantly surprised to come across half-gallons of name brand ice cream for just 99 cents.

“Being frugal is not anything to be ashamed of. It’s just the way of life,” he said. “It’s something you have to do to, if not to beat the system, then to keep up with it.”

Fledgling Brands May Take the Fall With Steve & Barry’s

Retailer’s Cash Crunch Imperils Low-Priced Clothing Lines From Sarah Jessica Parker, Venus Williams

Advertising Age

By Natalie Zmuda

Published: July 07, 2008

NEW YORK ( — Steve & Barry’s fall from grace could take several boldface names along for the ride.

The retailer, which has built its reputation on offering $15 Stephon Marbury sneakers and $9 dresses from Sarah Jessica Parker, is in a serious cash crunch. Bankruptcy is widely considered to be an option, leaving the fate of the retailer’s hundreds of exclusive celebrity lines and licensing deals in question. Steve & Barry’s operates about 275 stores in 40 states.

Exclusive deals: Stephon Marbury is one of many with a line at the chain.

In addition to holding a vast number of licenses — more than 350, according to the company’s website — Steve & Barry’s has exclusive deals with well-known figures such as Ms. Parker, Mr. Marbury and Venus Williams. But it’s the names with less-broad-based consumer recognition, such as golfer Bubba Watson, actress Amanda Bynes, surfer Laird Hamilton and basketball star Ben Wallace, that stand to take a hit if Steve & Barry’s collapses.

Bad news for new faces

“The newer names that are still getting established, being formed and creating an image in the consumer mind — this is pretty tough for them,” said Tom Agan, executive director-head of consulting for Interbrand, New York. “It’s not that consumers are saying it’s a bad brand because of the retailer’s problems. It’s more about the stage in their development. … They’re trying to get visibility in the marketplace.”

Indeed, Mr. Watson — who has yet to claim his first PGA Tour victory — is just beginning to emerge as one of golf’s more marketable figures, with his pink-shafted driver and reputation as the longest hitter on the tour. Similarly, Ms. Bynes is quickly becoming a Hollywood fixture, but her Dear collection for Steve & Barry’s represents her first major foray into branding.

For a fledgling brand, any hiccups involving availability would prove problematic, as would steep discounts, in the case of a potential liquidation. But the retailer’s woes could provide early exit strategies, depending on how the licensing deals were structured, experts said.

“A lot of times, it does give the celebrities the opportunity to bail out, if they want to, prematurely,” said Marshal Cohen, chief industry analyst for NPD Group. “In almost every case, you would likely see them transition to another low-priced retail partner.”

But finding another partner could prove tricky, as the retailer’s financial troubles, in part, are being blamed on slim margins.

Little wiggle room

“Because of the margin problems in retail, in general, the idea of paying additional fees for licenses is pretty tough to justify,” said Mr. Agan. “[The brands] will have to help [other retailers] understand that their brand has value and should be supported and given placement.”

A Steve & Barry’s spokeswoman declined to comment on the terms of its licensing deals or the company’s financial state. The retailer does not have an agency of record.

Beyond the high-profile celebrity endorsements, a slew of consumer-products companies and universities also license their brands to the retailer. Any impact on those brands would be less pronounced, experts said, given their established nature. CBS Consumer Products, Marvel Comics, General Motors, Ford, Kellogg, Hershey and Coors all have agreements with Steve & Barry’s. And as recently as last month, the retailer continued to add other major companies, including Pepsi, to its roster.

The biggest impact on those well-established brands likely will be the loss of a retailer that, in a tough economy, attracted plenty of cash-strapped shoppers. The chain’s core consumers, teens and young adults, are being hit particularly hard.

“Teens right now are looking to stretch their dollar in any way possible,” said Gary Rudman, president of GTR Consulting. “They’re looking for retailers that can provide cool brands and hip clothing at decent prices. If that disappears, it definitely leaves some sort of void.”