Tuesday, February 5, 2013 | Edited by Daniel Moores
||Cautious Consumers to Keep Cupid at Bay This Year
Love is in the air this Valentine's Day but consumers aren't quite ready to shell out the big bucks for their loved ones as much as they were last year.
The 2013 Valentine's Day spending survey conducted by BIGinsight shows only a slight increase in expected sales this year, with the average person planning to spend $130.97 on candy, cards, gifts and more, up from $126.03 last year. Total spending will reach $18.6 billion.
"Valentine's Day remains one of the biggest gift-giving holidays of the year, and although consumers will be conscientious with their spending, it's great to see that millions of Americans are still looking forward to celebrating with their loved ones," said NRF President and CEO Matthew Shay. "Recognizing their customers will shop for both price and value, retailers and restaurants will offer plenty of promotions for anyone looking to spoil those that mean the most to them this February 14th."
A mix of traditional and non-traditional Valentine's Day gifts will be popular this year. More than half (51.0%) of gift givers will buy candy, spending $1.6 billion in total, and another one-third (36.6%) will give flowers, with total spending expected to top $1.9 billion.
Others will treat their special someone to jewelry (19.7%), spending more than $4.4 billion on diamonds, gold and silver. An additional 15.6 percent will buy clothing, spending more than $1.6 billion. Gift cards, the gift that keeps on giving, will also be on the top of shoppers' lists; 15.0 percent of gift givers will buy gift cards for their loved ones, totaling to $1.5 billion.
As price and value continue to top gift-givers minds, there will be no shortage of comparison shopping this Valentine's Day, and much of it will be online. The survey found that more than one-quarter (26.3%) of those celebrating this year plan to shower their loved ones with gifts found online, up from 19.3 percent last year and the most in the survey's 10-year history.
Other shoppers will seek out the perfect gift at discount stores (39.6%), department stores (33.2%), specialty stores (22.9%), floral shops (19.6%), jewelry stores (11.2%), specialty clothing stores (7.5%) and through catalogs (2.6%).
Celebrating Valentine's Day isn't always for couples; though people plan to spend the most on their significant other ($73.75), 60.6 percent of shoppers plan to show their appreciation for other family members and will spend an average of $26.46.
One-quarter (25.2%) of celebrants will buy gifts for friends, spending an average of $8.49, and 13.2 percent say they will buy Valentine's Day gifts for their co-workers, planning to shell out an average of $5.12 on their colleagues.
Consumers haven't forgotten about their four-legged friends either: two in five (20.0%) Americans plan to buy gifts for their pets this year, with total spending expected to reach $815 million.
The average male that has been hit by Cupid's arrow will spend significantly more than the average woman this year. Men will spend an average of $175.61 on jewelry, flowers, a romantic evening out and more, while their counterparts will spend approximately $88.78.
"The mantra 'it's the thought that counts,' might be most applicable for holidays like Valentine's Day, and there's no question that this year's budget-conscious gift givers will keep this in mind while out looking for the perfect gift," says BIGinsight Consumer Insights Director Pam Goodfellow. "There will be no shortage of deals in the coming days, so frugal consumers will keep a keen eye out for promotions on chocolates, flowers and even dining."
Additionally, four in 10 (40.7%) smartphone owners will use their handhelds to shop for gifts, and 46.9 percent of tablet owners will use their devices to purchase items, research gift ideas and more.
(Source: National Retail Federation, 01/31/13)
To access the complete Valentine's Day survey results, follow this link.
||Toyota, Detroit 3 Set Pace as Auto Industry Feeds on Optimism
The Detroit 3 and Toyota led U.S. auto sales to a 14 percent gain last month as robust demand from November and December carried into the new year.
Automakers sold 1,043,192 light vehicles, the highest January volume since 2008. That translated to a seasonally adjusted annual selling rate of 15.3 million, following a 15.6 million SAAR in November and 15.4 million a month later. The industry hasn't seen such a 15-plus streak in five years.
"We continue to recover strongly from the recession, despite the headwinds of higher taxes and lower government spending," said General Motors sales chief Kurt McNeil, who downplayed a reported fourth-quarter decline in U.S. economic growth as a quirk of volatile defense spending.
"More important from our perspective: Customers bought cars and trucks in robust numbers," he said after his company posted a 16 percent January gain. "This feeds our optimism for the year."
Ford Motor sales boss Ken Czubay said pent-up demand continues to drive sales.
"I think the biggest driver of this year's story is going to be replacement," he said following Ford's 22 percent increase. Other big gainers included Toyota Motor Corp., up 27 percent, and Chrysler Group, up 16 percent.
U.S. sales have now topped the 1 million unit mark 12 months in a row. Last month ended a four-year stretch of Januarys below that level. All automakers posted sales increases except Mitsubishi, product-short Mazda, and Suzuki -- which is exiting the U.S. market.
Other January highlights:
Toyota leads the pack
Toyota Motor Sales led all automakers in January with a 27 percent gain, matching its percentage increase for all of 2012.
"We started with a bit of apprehension with the fiscal cliff, new tax rates, (a) slower month and the year-end push," Toyota brand General Manager Bill Fay said, but "the sales pace we saw in fourth quarter rolled right into January."
Rarity: Detroit 3 outperform market
All three Detroit-based automakers posted January sales increases better than the industry's 14 percent growth.
That didn't happen once last year. Chrysler beat the industry eight months in 2012, but GM and Ford both performed worse than the market did all 12 times.
Honda, VW cool off
Both American Honda and Volkswagen Group started the year up, but at a pace considerably slower than last year. Honda sales increased 13 percent last month after a 24 percent jump for all of 2012. VW rose 9 percent in January, down from 30 percent growth for the previous year.
The new luxury race
Last year, BMW edged Mercedes-Benz to retain its title as America's best-selling luxury brand, while former champ Lexus lagged well behind.
New year, new race. In January, Mercedes took an early 7,000-unit lead over BMW, while Lexus is only 302 units behind the Bavarians. And Cadillac, with its new ATS and XTS sedans in stock, jumped 47 percent to put itself into the mix.
Nissan, Hyundai-Kia lag
After double-digit 2012 sales growth, both Nissan North America and Hyundai-Kia Automotive recorded 2 percent January volume increases, well below the industry average.
Smaller Japanese brands mixed
The three smallest-volume Japanese automakers all had tough starts to the year. Struggling Mitsubishi was down 1 percent, extending its streak of monthly declines to 13. So was Suzuki as it withdraws from the U. S. market. Awaiting a redesigned Mazda6 sedan, Mazda fell 11 percent.
Subaru, meanwhile, posted its 14th straight monthly increase, up 21 percent.
Other Euro brands gain
Jaguar ended a four-month slide with a 5 percent gain, while Land Rover rolled to a 31 percent gain. The corporate duo led smaller-volume European premium brands. Daimler group rose 11 percent despite a 3 percent decline at Smart, whose sales nearly doubled in 2012. Volvo rose 9 percent. BMW Group gained 2 percent overall; Mini's 10 percent rise pairing with a 1 percent increase for the BMW brand.
Pickup sales strengthen
Detroit 3 pickups started the new year with a flurry, up a combined 25 percent to 115,606 units as the U.S. housing industry gains momentum. Chrysler's newly redesigned Ram rose 14 percent. Ford F series jumped 24 percent, perhaps benefitting from Ford dropping the Ranger compact pickup.
But the soon-to-be-replaced Chevrolet Silverado soared 32 percent and GMC Sierra was up 35 percent. Together, the aging GM pickups outsold the F series, 48,291 to 46,841.
A Chrysler insider said a surge of buyers in January told the automaker's dealers that they had put off making a purchase in December because of the Congressional debate on the fiscal cliff, but now felt a U.S. economic meltdown was unlikely.
TrueCar.com analyst Jesse Toprak also observed that sentiment, noting that it was strongest among small business owners buying full-size pickups.
(Source: Automotive News, 02/01/13)
||Craft Beer Sales Continue to Rise
Despite the economic downturn, craft beers are defying recessionary trends with an impressive upward swing, according to Mintel.
The latest research by Mintel on the craft beer market in the U.S. shows that sales of craft beer nearly doubled between 2007 and 2012, increasing from $5.7 billion in 2007 to $12 billion in 2012.
The trend toward craft beer options is set to enjoy robust growth through 2017, with Mintel forecasting the segment to grow to $18 billion by 2017 -- a result that will see the segment tripling in the decade between 2007 and 2017.
"Unlike its domestic and imported beer counterparts, craft beer has been able to defy overall beer market trends and continue expansion during the economic downturn and subsequent slow recovery," said Jennifer Zegler, beverage analyst at Mintel, in a release. "While the craft and craft-style beer category remains a small segment of the $78 billion U.S. beer industry, the category has been able to stabilize the overall beer industry, which has experienced volume declines in the domestic and imported beer categories since 2008."
Nearly a quarter (24%) of consumers who drink beer indicate that in 2012 they drank more craft beer sold at stores compared to 2011. More than one in five (22%) report consuming more craft beer in bars or restaurants.
Mintel research shows that craft beer's sweet spot is with 25- to 34-year-old consumers (older Millennials). While overall, some 36% of U.S. consumers drink craft beer, half (50%) of older Millennials do so. And craft beer also wins on taste. Some 43% of both Millennials and Generation X say that craft beer tastes better than domestic beer, compared to 32% of Baby Boomers.
Although successful, craft beer is not free from challenges. Only 17% of Millennials and 18% of Generation X say that craft beer is a better value. A majority (56%) of consumers of all ages feel that domestic beer is a better value compared to craft beer. Furthermore, Mintel research found that nearly half (45%) of consumers would try more craft beers if they knew more about them.
Despite the variety of beer releases created by craft breweries, craft beers are not yet everyday beer choices for most drinkers due to a lack of understanding about their taste profiles, Zegler says.
"To continue growing, craft beer must be its own best advocate and expand appeal beyond Millennials who are most likely to consume craft beer," she said. "An additional barrier is lack of knowledge. Craft brewers need to focus on education through tastings and classes that inform consumers about the differentiation in flavor between craft beer and other alcoholic drinks."
Mintel research also found that 50% of overall craft beer drinkers express interest in locally made beer, and 25% are interested in purchasing craft beer where it was brewed. Another 39% say they are influenced to purchase a craft beer if it has a personality to which they can relate.
(Source: Marketing Daily, 01/23/13)
Daily Sales Tip: Ask, Listen and Speak
Many media sales reps stroll into a first meeting talking about "their" personalities and "their" rankings and "their" packages, before asking any questions about the prospective client's business.
Oftentimes, they then spend more of their prospect's precious time negatively positioning other stations in the market. By the time they leave the appointment, they know little more about the person's business than when they came.
Most people have an impression of a superstar salesperson as being an "interesting extrovert." However, in this day and age, there may be an equal number of media sales superstars who are more the "interested introvert" type.
It is more beneficial to spend your appointment time asking thoughtful questions about your clients and their businesses, and then listening with interest to the answers they provide. Only then will you know more about where you can provide value when you speak.
If we were supposed to talk more than we listen, we would have two mouths and one ear. -- Mark Twain
Source: Sales consultant Michael Guld, president of The Guld Resource Group