Orlebar Brown

TRADE IN TO TRADE UP

Consumers are more aware than ever that their old products have value, yet loss aversion, theendowment effect (overvaluing one’s own possessions), and the inconvenience of selling mean that consumers are frequently reluctant to sell even seldom-used items.

Which is why brand-led TRADE IN TO TRADE UP initiatives overcome many of these barriers: consumers can quickly and conveniently unlock the value in their old products, while instantly laying their hands on new, improved versions.

Shoppers in fast-moving sectors such as fashion and consumer electronics welcome trade-in programs, as they help offset the prohibitive expense of staying up-to-date with always-desirable new products with ever-shorter life spans, and often ensure that outdated items get reused or recycled.

Fashion consumers and brands are embracing TRADE IN TO TRADE UP programs:

French label A.P.C. launched the Butler Worn-Out series, where customers who brought in used jeans could trade them for a new pair at half price. The used jeans were repaired, stitched with the initials of the previous owner and resold. The range is so-called because 19th century English aristocrats would have their butlers wear their clothes first, to break them in.

Levi’s Singapore offered customers SGD 100 when they brought in their old jeans and bought a new pair: a SGD 50 discount and a further SGD 50 in vouchers.

Is RECOMMERCE a ‘new’ mega trend that’s going to transform your business completely? No. But on-the-ball readers will already be brimming with ideas about how they can apply the insights in this Trend Briefing to their businesses tomorrow (and certainly in the run up to the holiday season). By helping people realize the value in past purchases in such a way that is not only gratefully appreciated (there’s a big feel-good factor to RECOMMERCE that fits well with the call for more ‘human’ brands), but also generates sales and profits. Which, we imagine, should be music to all business people’s ears right now.

Source: www.trendwatching.com. One of the world’s leading trend firms, trendwatching.com sends out its free, monthly Trend Briefings to more than 160,000 subscribers worldwide.

PAUL BUDNITZ BICYCLES

A window display on Nanjing Road, Shanghai

Shopping moments are now ubiquitous: offline (in the real world, nearly everything now has a retail component!) and online. Meaning that over the last years, smart retailers have looked hard at what would make them unique and forever desirable.

The ones who have been relentlessly reinventing themselves understood that while ON=OFF brings extra transparency and information into stores, shopping isn’t purely functional. For a large number of consumers around the world, ‘going shopping’ is a leisure activity: a way of relaxing, a source of entertainment or a chance to meet up with friends and share experiences.

Indeed, when consumers go shopping in person, they increasingly expect to feel or experience something that they can’t get online: a compelling spectacle, exclusive products, the ability to test and feel things, or learning how to use products. Hence, the rise in highly experiential stores and outlets, turning the retail arena around the world into a veritable RETAIL SAFARI.*

* We’re not saying that physical stores will become wholly focused on providing ever more extreme experiences. It’s a cliché, but there will always be shoppers who just want the convenience and instant gratification of buying in a physical store. In those cases too, retailers who make that process so enjoyable or personal that consumers don’t feel the need to compare it online will thrive. Just look at Apple!

Source: www.trendwatching.com. One of the world’s leading trend firms, trendwatching.com sends out its free, monthly Trend Briefings to more than 160,000 subscribers worldwide.

Expect an increasing number of ‘Western’ brands to launch new products or even new brands dedicated (if not paying proper respect) to consumers in emerging markets. After all, it’s where the money is right now, and Western brands are still favored over local ones, so the combination of perceived quality with a bit of local tailoring, love or exclusivity makes total sense*.

* Like all consumers, these Chinese, Indian or Brazilian consumers will appreciate products that are tailored to their needs, wants and desires, either for practical reasons (shape, size, features) or because of the deep-rooted desire for recognition (cultural pride, heritage, lifestyles).

This MADE FOR CHINA (IF NOT BRIC) phenomenon is just one of the many sub-trends spawned by the macro trend of economic and consumption power shifting towards emerging markets. Just to remind you:

• China’s retail sales, the main gauge of consumer spending, rose 18.7% year on year to USD 183 billion in May 2010, following a 15.2% rise the previous year. (Source: Chinese National Bureau of Statistics, June 2010)
• China’s retail sales may outstrip those of the US by reaching USD 5 trillion in 2016. (Source: Chinese People’s Political Consultative Conference, September 2010)
• Affluent Chinese consumers prefer foreign brands: 52% of consumers whose annual income exceeds RMB 250,000 (USD 36,765) trust foreign brands more than Chinese ones while just 37% said they prefer the latter. (Source: McKinsey, September 2010)

So who has already jumped on the MADE FOR CHINA band wagon? Check out the following examples:

• Levi’s dENIZEN Jeans brand, targeting Asians/Chinese consumers with slimmer fits.
• Dior‘s very expensive Shanghai Blue Phone, only available in Shanghai stores.
• Hermès’ new Chinese brand, Shang Xia; its luxury stores sell ready-to-wear and decorative arts inspired by Chinese culture.
• Chloé’s limited edition Marcie handbag to celebrate their fifth anniversary in China.
• BMW’s limited edition, orange metallic M3 Tiger to celebrate the 25th anniversary of its M3 model in China, which coincided with the Chinese lunar calendar (the year of the tiger).
• Last but not least, and the inspiration behind the naming of this trend: Apple’s Shanghai store employees started wearing red t-shirts with the slogan ‘Designed in California, Made for China’ written in Mandarin. The message is a play on the words that are found on the back of all iPhones: ‘Designed by Apple in California, assembled in China’.

P.S. Brands like Honda (Li Nian), Nissan (Venucia) and GM (Baojun) are busy introducing ‘cheaper’ brands in China, too, as many consumers in emerging markets still do have less to spend than their counterparts in mature consumer markets. And yes, that’s yet another ‘Emerging Markets’ sub-trend. If you really can’t get enough of this topic, do re-read our Trend Briefings on FUNCTIONALL andEXCEPTIONALL.

Source: www.trendwatching.com. One of the world’s leading trend firms, trendwatching.com sends out its free, monthly Trend Briefings to more than 160,000 subscribers worldwide.