JWT’s AnxietyIndex is designed as a place to discuss how brands and consumers are responding to the global recession. With daily content updates, AnxietyIndex.com includes contributions from around JWT’s network, offering a truly global perspective.
Manila constantly ranks in the top 10 worst cities in the world in terms of traffic. Congestion exponentially increases during the Christmas season, which means getting grumpy on the roads is a foregone conclusion at this time of year. Last Christmas, one company took the opportunity to lift the mood of Filipino motorists, in a move that exemplifies one of our 10 Trends from 2011, Creative Urban Renewal.
Bringing Christmas cheer to the roads, Fort Bonifacio Development Co.—the company behind Bonifacio Global City (BGC), the latest central business district in Manila—turned stoplights, construction cranes and trees into Christmas decorations. On the stoplights, a red star and a green Christmas tree replaced the usual circles. While the initiative didn’t improve the traffic situation, at least it improved a lot of motorists’ dispositions.
Upscale U.K. department store Harvey Nichols positions its women’s-wear department as the answer to a holiday-season anxiety for potential customers: that after searching for the perfect party getup, they’ll be upstaged by another woman wearing the same thing. This “nightmare” scenario is taken to an extreme in a humorous video: Two women at the same party are wearing the same distinctive red dress, and instead of figuratively shooting daggers at each other, they start shooting red lasers from their eyes, destroying much of the space. Eventually one of the women is defeated—but then a third woman arrives in the same dress, and a new battle begins.
“Avoid a same dress disaster this season,” says the on-screen copy at the end. This type of retailer can’t compete on price, but it can compete with the ubiquitous chains on unique offerings that are perfect for showing off at holiday parties.
The recession revived the popularity of layaway plans, and with many consumers still struggling to make ends meet, retailers have been pushing their pay-over-time offerings again this holiday season (as we’ve posted about). Last year saw the rise of “layaway Santas,” Good Samaritans who paid off strangers’ layaway accounts, mostly at Kmart, and this year retailers have been trying to leverage the behavior.
Kmart sponsored a Big Layaway Giveaway, holding a drawing for 10 weeks from September through November to pay off the remaining balance in a layaway account. And it set up a Layaway Angels page online to track the frequency of “angel” donations (as yet, the tally is a tepid $1,521). Toys “R” Us, meanwhile, announced it would donate $200 worth of goods to the Marine Toys for Tots Foundation for each layaway order that a Good Samaritan pays off. Layaway provides a novel means for new types of retail initiatives to help strained consumers, and even for consumers to help one another; it will be interesting to see how retailers continue to expand the concept.
With many U.K. consumers facing an austere Christmas, upscale supermarket chain Waitrose created a stripped-down TV commercial for the holiday season and donated an additional £1 million to local causes. “At what is a difficult time for many people across Britain, we feel that Christmas is the right time to give more back to good causes in the communities we serve,” explained Waitrose’s marketing director in a release. The ad shows food celebrities Delia Smith and Heston Blumenthal—who regularly appear in Waitrose ads and waived their fees this time around—in an empty studio. They explain that “instead of a fancy TV advert,” Waitrose is giving more to charity (customers help decide which causes Waitrose should allocate money to).
Will consumers feel the gesture is appropriate in light of their current economic anxieties, regarding the lavish commercials from Waitrose’s rivals as wasteful? Or will they miss the usual festive flair on their screens and see the retailer as “a bit holier than thou,” as one YouTube commenter complains (“Like when someone gives some village a goat for Christmas on your behalf”)?
Back in 2009, Kmart and Sears revived the old Christmas layaway concept, first popularized during the Great Depression, as we noted at the time. Toys “R” Us and Best Buy followed suit with their own iterations. But even as the recession has subsided, the layaway concept has endured (getting a PR boost last December when “layaway angels” began paying off random balances at Kmarts and Walmarts around the U.S.). With many Americans still struggling and reluctant to pile more debt onto credit cards, merchants are filling in the gap to get the sale, with both brick-and-mortar and online retailers revving up their pay-over-time concepts for the upcoming holiday season.
Accordingly, the layaway landscape is getting more competitive. Within the past two weeks, Toys “R” Us said it would waive its service fee and minimum purchase amount until Oct. 31, after which it will be $5. “WOW!! No upfront fees!” proclaims the retailer’s site. Then Sears’ Kmart announced that it too would waive its layaway fees, through mid-November. And after initially tripling the fee, to $15, Walmart dropped it back down to $5, which is refunded after customers make their final payment. The retailer also extended its layaway program by a month (it kicks off Sept. 16), giving customers more time to pay, and added more eligible items.
Online retailers are jumping into the layaway game, too: eLayaway offers Internet retailers a turnkey solution for managing their layaway programs. And Globalgroup Investment Holdings, a payment and collection services company, is preparing to launch “America’s Layaway Mall,” an online department store targeting “fiscally challenged” shoppers with various payment plans for electronics, jewelry and other bigger-ticket items.
With continued forecasts of economic gloom in various parts of the world, the usual focus on unfettered holiday spending feels out of sync with the times. So some shoppers are embracing the idea of simple pleasures, opting for a less materialistic season. With retailers reporting depressed sales figures in an economically cautious Britain, for instance, The Christian Science Monitor reports anecdotal evidence of less-commercial holiday outings, such as an uptick of interest in carol concerts.
Some marketers are tapping into this mindset by emphasizing relationships and togetherness rather than overstuffed Christmas stockings. In a heartwarming spot set to Jimmy Durante’s mid-century classic “Make Someone Happy,” Vodafone reminds viewers that “It’s the little things we all do at Christmas that make us happy.” The spot shows people giving “free” gifts, such as cleaning the snow off a neighbor’s car or calling in a radio song dedication for a friend.
Jack Daniel’s is more direct in its approach, with the line “It’s not what’s under the tree that matters. It’s who’s around it.” A print ad and commercial show residents of Lynchburg, Tenn.—home to the iconic American distiller—coming together for the lighting of a giant Christmas tree constructed from whiskey barrels. The concept is meant to pay homage to the brand’s 19th-century founder, who supposedly “liked to bring people together at his home during the holidays,” harkening back to a time of simpler celebrations.
As brands and consumers alike work out how to navigate the new normal in the year ahead, watch for marketers to focus on the basic pleasure of bringing loved ones together.
U.K. retailer Argos is running a whimsical ad that suggests online shopping as an antidote to the year-end stress of navigating frenzied retail environments. The ad’s stars are a family of long-necked blue aliens on a visit to a mall. “It all feels a bit alien, doesn’t it, running around panicked?” says the father. “I thought ’twas the season to be jolly, but maybe not.” The daughter, sporting a stylish wool hat, points out that “The big man in red seems happy enough,” but Mom counters that “Everyone seems terribly stressy though. I don’t understand why they don’t just reserve their purchases online with Argos.” The ad pushes the idea of ordering on the Web—with alien mom using her mobile to do so—and picking up in store on the same day.
Britons are expected to spend £13.4 billion in online purchases this holiday season, according to one estimate—a good deal of it today, which is Cyber Monday in the U.K.; big numbers are expected. But a perfect storm of inflation, unemployment and the eurozone crisis are likely to dampen overall spending, and The Telegraphreports that retailers are carving into profit margins with price cuts and promotions in a grab for limited budgets. More retailers will need to avoid a race to the bottom by appeasing anxieties unrelated to price, as Argos does by suggesting a way for shoppers to preserve some sanity.
Do holiday shoppers spend less on themselves so as to afford gifts—last year we posted on an Accenture study suggesting this would be the case in 2010—or treat themselves more, given the “licensing effect” and the pervasive message that this is the time to get bargains? The National Retail Federation in the U.S. is suggesting that since retailers have been telling Americans to expect great deals, consumers who’ve been holding off purchases are planning to stock up for themselves right alongside gift recipients. An NRF survey found that 6 in 10 holiday shoppers intend to “take advantage of retailers’ sales and discounts to make additional non-gift purchases for themselves and their families during the holiday season”—with plans to spend an average of $130 on these purchases, up 16% from what they cited in 2010.
Last year we spotlighted a J.Crew website message telling shoppers to “take time to treat yourself.” The NRF points to a recent similar theme from J.Crew, which featured a home page reading “To: You. From: You” (the page has since changed). Zappos is pushing the idea heavily, with home page messages along the lines of “Handbags: One for you. One for them. Happiness for all.” And as MSNBC.com points out, retailers are also suggesting “family gifts” (e.g., a new TV), often de facto self-gifts for the purchaser, and making buy-one-get-one-free and gift-with-purchase offers, giving gift shoppers the best of both worlds (something for themselves folded into the bargain).
The ongoing challenge, of course, is that since most Americans still have limited funds, spending more on themselves won’t likely mean higher spending overall. (Indeed, consumer behavior researcher Paco Underhill notes in DailyFinance that one driver behind self-gifting is that the downturn made more modest gifts acceptable and led to some no-gift agreements.) Retailers can benefit in the long term, though, if shoppers get in the habit of making a list for themselves over the holidays.
Coca-Cola’s campaign for this Christmas in Spain tries to go beyond the message of hope and happiness it airs traditionally. Instead the brand has created a digital free-cycling space, called The Hope Store, where people can donate up to three items and then acquire what others have listed; Coca-Cola pays for the shipping for the first 40,000 items. Since participants can select only as many free items as they’ve uploaded, giving more means receiving more.
Increasingly, to survive in a world of consumption-shy consumers, brands will have to shift focus from simply selling products or services to helping consumers. This may mean building communities, providing advice, offering entertainment, etc. In this case, Coca-Cola is helping people donate to others while helping those who may be unable to afford Christmas gifts get some free goods.
The holiday season is a hectic and often anxious time: Fighting crowds while shopping, the obligatory string of parties and the unavoidable trip to your in-laws has a tendency to take a good portion of the peace, love and joy out of Christmas. A clever pun from Banana Republic, “Love the Present,” reminds busy shoppers to slow down and take a breather. (The holiday theme was accompanied by a “Find the Love in the Present” photo contest.) It’s also a subtle nudge to buy now rather than wait for better economic times, or maybe even partake in some “self-gifting” as we wrote about a few weeks ago.