Spotting the latest consumer trends has become a major task in many corporations and more and more companies offer services that help in understand consumers and identify the next big thing that will have an impact on future products and services. I have already written about some websites that offer latest insight in consumer trends and just recently found an article written by Malcolm Gladwell about cool hunting and the search for the latest consumer trends. Even though the article is already 10 years old, the principles are still valid. If you have read his book “The Tipping Point” you will recognize a few of the case studies in this article.

The article still has a few interesting take aways:

This is the first rule of the cool: The quicker the chase, the quicker the flight. The act of discovering what’s cool is what causes cool to move on, which explains the triumphant circularity of coolhunting: because we have coolhunters like DeeDee and Baysie, cool changes more quickly, and because cool changes more quickly, we need coolhunters like DeeDee and Baysie.

The innovators do get their cool ideas from people other than their peers, but the fact is that they are the last people who can be convinced by a marketing campaign that a pair of suède shoes is cool. These are, after all, the people who spent hours sifting through thrift-store bins. And why did they do that? Because their definition of cool is doing something that nobody else is doing. A company can intervene in the cool cycle. It can put its shoes on really cool celebrities and on fashion runways and on MTV. It can accelerate the transition from the innovator to the early adopter and on to the early majority. But it can’t just manufacture cool out of thin air, and that’s the second rule of cool.

The key to coolhunting, then, is to look for cool people first and cool things later, and not the other way around. Since cool things are always changing, you can’t look for them, because the very fact they are cool means you have no idea what to look for. What you would be doing is thinking back on what was cool before and extrapolating, which is about as useful as presuming that because the Dow rose ten points yesterday it will rise another ten points today. Cool people, on the other hand, are a constant. […] Their non-cool coolhunter just didn’t have that certain instinct, that sense that told him when it was O.K. to deviate from the manual. Because he wasn’t cool, he didn’t know cool, and that’s the essence of the third rule of cool: you have to be one to know one.

Read the full article.

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Avenue A | Razorfish recently published the “2008 digital outlook report“. On 164 pages they present what happened in 2007 and what they think will happen in 2008 in the digital media landscape.

For many consumers, an engaging advertisement still powerfully influences their decisionmaking. But even more powerful, are the opinions they share with each other through trusted blogs and social networks. A mother in Topeka, Kansas, or a teen in a London flat can become trusted authorities, influencing more decisions than the best formulated professional branding campaign that an advertising agency can offer. Consumers are turning to a seemingly endless source of specialized media – so much so that commonly accepted best digital best practices have very short shelf lives. Yesterday’s solutions simply aren’t adequate to solve today’s problems. Is it any wonder that most businesses are coming to the hard realization that they aren’t organized effectively to respond to change?

Avenue A | Razorfish’s 2008 Digital Outlook Report examines where that digital spend is going. We provide direction on how marketers can align their organization to respond to the new digital environment, as well as a framework for effectively managing emerging channels and social media. And we give you some interesting new insights into consumer behavior.

The chapter “ten digital media issues to watch in 2008″ is especially interesting, so watch out for:

1. The move beyond media buying
2. The impact of a recession on online advertising
3. The redefinition of online media measurement
4. A limited increase in average CPMs
5. The fallacy of the “digital upfront”
6. The slowing of ad network acquisitions
7. A breakout year for mobile—but not for mobile advertising
8. Nokia’s emergence as a key player in the digital marketing industry
9. The continuing lack of video ad standards
10. The Internet’s impact on the 2008 presidential election

For me personally issue 8 “Nokia’s emergence as a key player in the digital marketing industry” provided new insights.

Nokia made two important moves in 2007 that will impact digital marketing in the coming year. It acquired both Enpocket, a leading mobile advertising and marketing services firm, and Navteq, a leader in navigation data and systems software. While there have been no formal announcements from Nokia about how its assets will fit together, it is clearly going to be a company to watch in the coming year. Nokia appears to be vying to expand its own business outside of consumer mobile devices and into the software and services that consumers are able to use on those devices.

Nokia now has assets that may accelerate the use of smart devices that use location-based services that know where we are. The potential benefit for marketers is the ability to deliver relevant, geographically contextual advertising opportunities to customers. Accomplishing this feat in the U.S. today, while not impossible, often involves orchestrating a small army of carriers, devices, marketing services providers, and agencies whose interests are not always aligned.

Download the full report.

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“Design Serving People“, an article written Elizabeth Sanders and published in the working paper series “Cumulus” by the University of Art and Design Helsinki, describes a major shift in the mindset of designers when designing new products or services. Consumers become creators when the designer’s mindset shifts from a perspective where people consume a service to a perspective when organizations support people in reaching their goals and creating value. The products and services offered by a company are merely resources that help the customer fulfil its needs and dreams.

Design is not serving the needs and dreams of people today. In comfortable American home, schools and workplaces, people are beginning to feel uneasy. It has become increasingly evident that they are no longer satisfied with simply being “consumers”. Everyday people want to be “creators” as well.

Stimulating peoples creativity and giving them tools will lead to a shift from consumption towards creation. This might sound vague but by observing the changing role of everyday people in design processes one realizes that many successful companies are already designing products and services that make their customers co-creator - YouTube is the most prominent example for user-generated content.

It is time to move away from the traditional design disciplines that are founded on the materiality of the artifact (graphic, product, space, software, architecture, etc.) and instead organize around human experience domains such as learning, creating, healing, living, working, playing, shopping, etc. People are people whether they are finding their way around a building, using a product, reading a package or using a software application. Design should be about making sure that our results advance people’s personal growth and support a harmonious relationship between people and their environments.

Nike is not “just” selling running shoes anymore. Nike is selling an experience that supports people in advancing their personal growth. The winners are companies that are able to identify the underlying desires of their customers and incorporate them into the design of their products and services.

Read the full article here.

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“Design Meets Research” is an article in published by AIGA, the American Institute of Graphic Arts which discusses the challenges when market research methods are used for validating design decisions.

There is a group of brand consultants and cultural anthropologists alike that believe now that it is not the actual research itself that is the problem. It is rather about how research is often misused, what type of design concepts and stimulus are tested, and how data is analyzed that is most often at fault. When used correctly, research shouldn’t stifle creativity but rather offer designers stronger inspiration and focus.

The authors further explain the advantages and challenges of modern market research methods (ethnography, focus groups, quantitative eye tracking, online testing) and deduce 6 golden rules for market research.

1. Focus on testing communication effectiveness vs. design appeal.
2. When testing, make allowances for familiarity.
3. Market research is an art, not a science.
4. Focus on what consumers like about the brand or product first.
5. More is definitely merrier. Do not test designs in isolation.
6. Never ask consumers how they would improve a design.

Read the full article.

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The article “What Was I Thinking?” in The New Yorker presents the latest reasoning about humans’ irrational ways. The thesis is that people make bad decisions but they do it systematically and therefore it is possible to explain why they act like this. Some of the insights are extracted from the book Predictably Irrational: The Hidden Forces That Shape Our Decisions

Dan Ariely, a professor at M.I.T., offers a taxonomy of financial folly. His approach is empirical rather than historical or theoretical. In pursuit of his research, Ariely has served beer laced with vinegar, left plates full of dollar bills in dorm refrigerators, and asked undergraduates to fill out surveys while masturbating. He claims that his experiments, and others like them, reveal the underlying logic to our illogic. “Our irrational behaviors are neither random nor senseless—they are systematic,” he writes. “We all make the same types of mistakes over and over.” So attached are we to certain kinds of errors, he contends, that we are incapable even of recognizing them as errors.

When you walk into Starbucks, the prices on the board are supposed to have been determined by the supply of, say, Double Chocolaty Frappuccinos, on the one hand, and the demand for them, on the other. But what if the numbers on the board are influencing your sense of what a Double Chocolaty Frappuccino is worth? In that case, price is not being determined by the interplay of supply and demand; price is, in a sense, determining itself.

People aren’t just loss-averse; they are also effort-averse. They hate having to go to the benefits office, pick up a bunch of forms, fill them out, and bring them all the way back. As a consequence, many eligible employees fail to enroll in their companies’ retirement plans, or delay doing so for years. (This is the case, research has shown, even at companies where no employee contribution is required.) Thaler and Sunstein propose putting this sort of inertia to use by inverting the choice that’s presented. Instead of having to make the trip to the benefits office to opt in, employees should have to make that trip only if they want to opt out.

Read the full article.

Why do I blog this? In order to understand the drivers of technology and service adoption it is necessary to have a deep understanding of consumers. Tapping into the field of behavioral economics and consumer behavior can be the basis for extraordinary services and consumer experiences.

Photo courtesy of Anne-Sophie Leens

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