Thursday, February 28, 2008

Guest blogger Reinier Evers on the February theme

From his amazing free Trendwatching newsletter, the February trend briefing is on what he calls "The Expectation Economy":

Indifference will hit those brands that consumers know are under-performing, and that they can avoid due to sufficient availability of the best of the best. If you’re working for one of those under-performing brands, the scary thing is not just selling less (or nothing). It's that indifferent consumers will stop being forgiving, they will stop being cooperative and giving you feedback on how to be more like other, better performing competitors. They'll just leave and never return, without telling you why. Perpetual irritation is just as bad: this will occur when consumers are forced to buy from an under-performing brand, due to limited or no availability of what they already know is the best of the best.

In this light, pay special attention to fake loyalty and postponed purchases:

* Fake loyalty: consumers will continue to purchase from under-performing brands if the 'real thing' isn't available. To the under-performing brand, all may seem quiet on the western front, until the best of the best suddenly does become available. Good examples of fake loyalty can be found in the airline industry: millions of frequent flyers around the world know that Virgin Atlantic, Singapore Airlines, and Emirates offer a superior experience, but since these airlines don't fly on all routes, consumers have no choice but to fly with sub-par airlines, now and then, or all of the time. Count on them to vote with their wallets every time new routes are added by these 'best of the best' carriers, even if they've never flown with them before.

* Postponing purchases: some 'best of the best' brands like Apple actually manage to indirectly convince consumers to postpone certain purchases. Many consumers would rather wait for the iPhone or MacBook Air to become available than to buy a new phone or laptop.

I think the point he makes is one we should all pay attention to. Just because they aren't your competition NOW doesn't mean they aren't raising the expectations bar anyway. And, they could become your competition by moving into your market soon. Will you be ready?

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