June 26, 2018

Much is being written (and deservedly so) about the threat Amazon poses to retailers. It's now the #2 US retailer (worldwide sales) growing 24% annually. Less attention is being paid to the threat Amazon poses to brands. Amazon's unrelenting pursuit of dominance has resulted in its growing influence over four of the five factors that drive consumer purchase decisions. And it looks to be positioning itself to compete on the fifth.

The following explains the five factors, details the extent of the threat Amazon's poses, anticipates what is to come, and suggests strategies that brands can employ to prepare and thrive.

Consumer Purchase Decisions--...

February 13, 2018

In a recent post I demonstrated how life stage drives Millennial choice on where to live. In the Washington, DC metro area, for example, 38% of college educated, single Millennials live downtown. In contrast, only 8% of married Millennials with children do so. Homebuilders and financial institutions would be well-advised to account for the impending, inevitable shifts in demand for housing.

Life stage drives other abrupt changes in consumer lifestyles, priorities, and purchases. The good news is that changes in life stage can be anticipated and their impact estimated. This can and should inform near- and long-term planning and goal setting. I'll use spe...

February 9, 2018

There's been a lot of discussion regarding how financially-challenged Millennials are due to education debt. For example, there are many reports on the negative impact of debt on home ownership. While it's true that Millennial college graduates own homes at lower rates than Gen X did, it's the non-graduates we should be most concerned about.

Not only have non-graduate home ownership rates fallen by over twice as much as they have for graduates, but also there will ultimately be a lot more non-graduates. Even at the most optimistic estimates for Millennial college graduation, non-graduates will outnumber them by 3:2.

The chart below compares Millennial an...

January 23, 2018

Millennials are now the largest generation in the workforce scream the headlines. It's true, but be careful of the implications you draw from that.

Oddly enough, Millennials now constitute a smaller proportion of the workforce than young people did sixteen years ago (when Gen X was the same age as Millennials are now). To understand the generational dynamics at play, read on!

The chart below shows the total US working population (ages 19 - 64) from 2000 through 2016. The population is split into two groups by age. The first group in blue is composed of those between the ages of 19 and 35. This reflects the ages Millennials spanned in 2016. 

Compare the n...

December 19, 2017

Many metro-area downtowns have enjoyed a resurgence. Much of the growth has been fueled by young college graduates eager for opportunities and easy access to entertainment. The expansion has been bolstered by two population increases. First, over the last ten years the number of people in their 20's increased by over 4 million. Second, over the same time period, the proportion with a college degree increased by 5 percentage points.

But the sands are shifting. First, as Millennials marry and have children they are leaving the central cities. Second, the overall population growth of young adults is about to stagnate. These two trends will have far-ranging...

November 15, 2017

Millennials have made relatively little economic progress over Gen X. They outnumber them, but their incomes have been stagnant, and they have a significantly higher rate of poverty than does any other generation. Boomers on the other hand, not only outnumber preceding generations, but also have recently made substantial gains in income. This has had and will continue to have a profound impact on the distribution of income among people of various ages.

According to the US Census Bureau's Current Population Survey, US residents earned $10.6 trillion in income last year. That's up from $8.3 trillion (constant dollars) earned in the year 2000**. The chart...

November 9, 2017

American companies are increasingly focused on winning over the Millennial generation. Interestingly, there's no agreement on what it is.

The White House says it covers 25 years. Some demographers say 23. The Census Bureau says 19, and Pew Research says 17. And that's just a few of the differing definitions!

As a consequence, the number of reported Millennials varies a lot: from 76 million to over 110 million. As another consequence, this makes the size of Gen X vary from 49 - 70 million.

These varying generational boundaries are a problem because the relative sizes of the generations are often employed to determine how much effort to place on each of the...

September 6, 2017

It’s an American mantra that getting ahead requires college. The growing disparity in income between college graduates and those without provides ample evidence of that. Simply put, young adults with a four-year college degree earn about $17,000 more annually than those without one.

So, everyone should go to college, right? Problem solved? Unfortunately, going to college isn’t the same thing as graduating. The national six-year graduation rate of four-year institutions is less than 60% (See Figure 14). So, over 40% of those we send to college don’t make it through.

Millennials are often touted as the most educated generation ever. This is normally accomp...

June 1, 2017

Are you measuring your organization's success by the right set of customer metrics? Unless you know their impact on achieving your main objectives, you may be incenting the wrong actions. wasting money and time, and allowing your competitors to take your best customers.

Let me show you what I mean, using baseball as an example. If I were to ask you to name a batting statistic, the odds are you’d say batting average. No surprise; when batters come to the plate, their batting average is displayed prominently on the scoreboard and on your TV or mobile device.

A player's batting average is simply his number of hits divided by the number of official times at-...

May 13, 2017

It’s conventional wisdom that as people age, they spend less. The impression has been formed by charts like the one below based on data from the Bureau of Labor Statistics. The chart presents average household spending for various age groups in 2015.

Household spending generally rises through one’s early 50’s, and then steadily declines. This is just one of the factors that has led Marketers to focus on younger customers whose spending is still on the rise.

Unfortunately, charts like this can lead strategists and marketers to the wrong conclusions.

Older households tend to have fewer people in them. So, while overall household spending declines, spending...

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