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22squared Trends 2013: "The Sh*t List"
 

22squared Trends 2013: "The Sh*t List"

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Year-end 2013 re-cap and score card of our Trend predictions from one year ago. From the minds of 22squared.

Year-end 2013 re-cap and score card of our Trend predictions from one year ago. From the minds of 22squared.

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    22squared Trends 2013: "The Sh*t List" 22squared Trends 2013: "The Sh*t List" Presentation Transcript

    • THE 2013 TRENDS SH*T LIST A year-end report card on our 2013 predictions, and what’s in the works for 2014 Presentation Date: December 20, 2013 squared
    • BRAND PLANNING Contributors. Jackie Ayrault Sr. Analyst Saya Goyal Planning Director GUEST CONTRIBUTORS Jen Grant SVP, Director of Brand Planning Ned Brown SVP, Executive Creative Director Courtney McCalden Brand Planner Krista Lang SVP, Executive Media Director Mike McClelland Planning Director Genna Franconi VP, Director of Social Media Kaitlyn Roche Jr. Planner David Reeves SVP, Director of Creative Innovation and Development David Yeend VP, Planning Director Brandon Murphy EVP, Chief Strategy Officer 22squared © 2013. All Rights Reserved.
    • WHAT’S INSIDE Foreword Methodology 06 II. Media Trends 13 III. Shopping Trends 19 IV. Technology Trends 26 V. Trends Tracker 32 Afterword 3 05 I. Consumer Trends 22squared © 2013. All Rights Reserved. 04 33
    • Hello friends, The Sh*t List. Yes, it’s that time of year again: a time for fruitcake, impassable traffic outside shopping malls, and the frantic search for the perfect gift. It’s also the time of year for that ubiquitous agency output — the trend piece. I’ve generally found that these ponderous tomes have a shelf life roughly equivalent to the fruitcake mentioned above. After that, they become great paperweights or door-stoppers. Which is a shame, because a lot of time, sweat equity, and research go into developing them. We often remark that 22 is a different kind of agency — nimble, independent, collaborative — so it’s only fitting that we think about trends a little differently. We’re driven by a radical idea: that we should hold ourselves accountable for our lofty trend predictions. Rather than creating a massive trend review and sending it out into the ether, never to be discussed again (until next’s years assignment rolls around), we wanted to revisit predictions we made at the outset of the year and see how close we came to gauging the future. This is not to pat ourselves on the back if we were dead-on, or shame ourselves if we were deadwrong, but rather to make sure we’re always building upon our learnings. At the end of the day, we believe trends are organic things: not a static fact at a certain moment in time, but living, evolving, shifting patterns that shape and guide the world we live in. It’s by charting the course of these predictions over time that we can begin to see (and harness) the impact they make on our clients’ businesses, and thus know what to look for in the coming year. “We’re driven by a radical idea: that we should hold ourselves accountable for our lofty trend predictions.” This piece has been a true collaboration, both within the Brand Planning department and across disciplines here at 22. We hope you’ll enjoy reading it as much as we enjoyed pulling it together. We also sincerely hope that, as the new year rolls around, you won’t be using this as a doorstopper, but rather referencing it throughout the year to see how we stack up for next year’s trends time capsule. Happy holidays, and happy reading; Jen Grant SVP, Director of Brand Planning 22squared © 2013. All Rights Reserved. 4
    • Methodology. 1. INTERVIEW In December 2012, Brand Planning conducted 20 in-depth stakeholder interviews with bright minds across departments at 22squared. The goal? Take bets on what would be the big trends and changes in the coming year. 2. RESEARCH In parallel path, we researched the trends predictions that industry wonks, trendwatchers, and, yes, other agencies were making, and jotted notes on the major themes for 2013. 3. DISTILL We culled the stakeholder interview outputs into 4 major thematic areas (The Consumer, Media, Shopping, and Technology), and articulated specific trend predictions for each. Naturally, we ended up with 22 of them. 4. OBSERVE Then we sat back and enjoyed the glorious show that was 2013. 5. REVISIT This December, we revisited our trend predictions in light of what had actually happened over the course of the year, layering in secondary research with what we had witnessed in the marketplace. 6. CREATE THE SH*T LIST At last, we could create our list — a report card, if you will, of how our predictions stacked up against reality .... and what we think it means for 2014. Note: unless otherwise indicated, these ideas apply to the U.S. 22squared © 2013. All Rights Reserved. 5
    • Chapter I: The Consumer. Take a look at anyone’s search history on their phone or computer and chances are you’ll find a strange meandering list of search terms and phrases. Take mine, for example. These are the last 10 things I searched on my phone: 1) 2013 Heisman candidates 2) Pictures from Dec 8 NFL day 3) Philip Rivers 4) National temp map 5) Kmart Tampa Florida 6) Van Gogh postcards 7) Chicken fried chicken 8) Chicken and dumplings 9) Hair color black vs soft black 10) When was Starbucks founded Is this the list of someone who has severe ADD? Or someone who’s just plain nutso? Fortunately, I think I can safely answer no to both of these. But I am, I feel, a pretty good representation of the mindset of a typical consumer in 2013. As the technologies that surround us continue to grow in the way they aid our lives, a little something happens to our attention spans — they get tugged in about 500,000 different directions all at once. Multicultural-All Powering Down Pent-Up Passion Pursuits Transparency Fatigue Big Data For Me Mommies Lost Control On our Facebook walls alone, in one swipe of the finger, there is a litany of things calling for our attention. They’re literally jumping up and down, excitedly waving their hands in the air and gleefully yelling, “Me! Me! Over here! Me first! Take a look at me!” Friends’ updates. YouTube videos. Vine videos. News articles. Brand posts. Pictures. People checking in everywhere from their gym to the laundromat. And our minds go along for the ride. But here’s the really interesting part. As our minds go along on this wild ride and we can access more and more, we want more too. We want things at our fingertips even more quickly. (At some point our fingers will probably short circuit. But that’s a trend for some future year.) We want to know more. We want to be more connected. Be more involved. More entertained. More humored. More moved. More incited. More riveted. With all this “more” business, there isn’t room in our minds or our lives for just any old junk. The necessity for things of value goes up. Brands and companies have no choice but to find more ways and better ways to provide it. And we, the consumers, excitedly embrace it the moment it arrives at our fingertips. Remember the days of the pet rock craze? Well, it’s safe to say that kind of trend won’t be coming back any time soon. Ned Brown SVP, Executive Creative Director 22squared © 2013. All Rights Reserved. 6 “With all this “more” business, there isn’t room in our minds or our lives for just any old junk.”
    • NAILED IT MULTICULTURE-ALL What we predicted: DEC 2012 As the U.S. Hispanic population nears 53 million, the lines between Hispanic and “general market” will blur completely. Spanglish will appear on network TV commercials. Targeting by language will be replaced by more sophisticated means. And marketers will be forced to re-think their Hispanic audience. What happened: DEC 2013 Lines blurred indeed! “General market” spots from Wells Fargo, Target, and Dr. Pepper featured Spanish expressions, Spanish-language music, and Hispanic celebrities. Advertisers embraced the bicultural nature of Hispanics and began to use cultural cues, instead of language alone, to speak to their target. What it means for 2014: Hispanic culture will go mainstream and more advertisers will incorporate multicultural insights into their general market communications. While this shift will require more effort than simply translating English creative, the payoff will be well worth it for this key population that’s going to continue to grow in terms of spend and influence. UM, NO 22squared © 2013. All Rights Reserved. 7
    • NAILED IT POWERING DOWN What we predicted: DEC 2012 “Friendships” on social media leave us wanting something more human and real. We’ll value online sharing less, and seek out tangible connections more. What happened: DEC 2013 Consumers are recognizing the need to unplug and spend time with the friends and family standing right in front of them. Device-free times, events, or zones help users stick to the rules (think hotels, restaurants, and homes). But, online relationships aren’t going away. Facebook’s daily and monthly active user numbers continue to rise, as do the number of online dating participants. What it means for 2014: While social media won’t be slowing down, temporary unplugging will take off in more and more places. Relevant brands will take advantage of the trend and make an effort to help consumers get some much-needed mental space via apps (itself an irony), tangible reminders, shut-down campaigns, or rewards/incentives for occasionally tuning out or turning off. UM, NO 22squared © 2013. All Rights Reserved. 8
    • NAILED IT PENT-UP PASSION PURSUITS What we predicted: DEC 2012 The recession profoundly changed American attitudes toward careers and authentic experiences, essentially re-defining “luxury.” In 2011 Joseph Pine and James Gilmore called the phenomenon the rise of “the experience economy.” We predicted consumers would continue to swap “having” for “doing” and spend what discretionary income they had on experiences that could transport them beyond the bounds of their everyday realities. What happened: DEC 2013 Across the board, consumers became increasingly discerning about experience. This certainly proved true in the travel and leisure spaces, where focus shifted from tangible amenities to custom experiences built around food, nature, physical activity, and more. But we also saw increasing consumer expectations around “experience” in other areas of life, from retail store layouts to consumer finance. And even in the corporate world, Forbes reported that more Americans than ever were pursuing second careers, often around passion areas versus profit centers. What it means for 2014: Experience will continue to shape the retail space, with pop-up and unique boutique stores replacing or supplementing traditional establishments. Louis Vuitton is one brand already leading the charge here, combining experience- and adventure-based travel cues in their L’Aventure pop-up shopping destination. As the economy bounces back, we’ll be interested to see how luxury and experience begin to converge — and we predict that consumers will embrace the idea that the ultimate luxury is time. UM, NO 22squared © 2013. All Rights Reserved. 9
    • NAILED IT TRANSPARENCY FATIGUE   What we predicted: DEC 2012 Constant connectivity and access to instant information have ever-so-quickly eroded the barriers between fact and fiction in consumer culture. Consumers can instantly decide if a brand is acting authentically based on the reams of information available online, and you can bet it will spread like digital wildfire if folks have been duped. Now that this is the norm, we predicted the social value of transparency would decline — people won’t care as much. What happened: DEC 2013 Now that consumers have adjusted to the brave new world of social media, transparency has evolved from a desire to a table-stakes need — we no longer seek it out from brands because we now expect it. People openly broadcast and share their lives online, flaws and all — and brands are increasingly expected to do the same. Savvy consumers mock brands’ social blunders or policies of corporate mis-information (Pace Picante, anyone?). Brands that lead with transparent social missions (Warby Parker, TOMS, FEED) have trailblazed a new type of commerce, rooted in the idea that honesty and integrity are dominant forces in today’s consumer culture. What it means for 2014: Brands will continue to test their thresholds for transparency and openness in the face of demanding consumers. Brands must move from saying they ‘have nothing to hide’ to proactively showing and proving they have nothing to hide. Shared (or over-shared) values and constant communication will be rewarded. UM, NO 22squared © 2013. All Rights Reserved. 10
    • NAILED IT BIG DATA FOR ME What we predicted: DEC 2012 At the end of 2012, consumers were up in arms about big data and privacy concerns — this newfound information repository seemed intrusive or even creepy. For 2013, we predicted more brands would begin to use data to build authentic and personalized consumer experiences, normalizing the practice so consumers would be more open to giving brands their personal information. What happened: DEC 2013 While the creep factor has not completely gone away (and probably never will), today’s consumers seem more able to move past it. Many websites and apps allow users to register through social media accounts, and users comply so they can be served more relevant content. Google continues to connect accounts and monitor activities to create a more seamless experience cross-platform (and laser-target ads). On the brand/product side, Disney is implementing the Magic+ program in theme parks, providing extremely personalized experiences for guests. What it means for 2014: We predict brands will leverage data to provide personalized experiences that make consumers feel special — and begin working together to provide even better, more relevant, and enjoyable experiences to their common consumers. But successful brands will manage to balance personalization and utility with an awareness of the inherent “creep factor” and take a truly human approach to big data. UM, NO 22squared © 2013. All Rights Reserved. 11
    • NAILED IT MOMMIES LOSE CONTROL   What we predicted: DEC 2012 Cluttered with mommies, the blogosphere was ripe for change. We predicted that the mommy-blogger trend would shift and focus on new voices, like the growing population of stay-at-home dads. What happened: DEC 2013 While we did see a surge in daddy blogs and Boomer blogs, moms still ruled the blogosphere in 2013. Instead of diversification of bloggers, the true shift was a diversification of channels. In addition to reading their blogs, we started following our favorite mommies on Vine and Instagram. Tumblr also played a big role in changing the landscape, popularizing short-form content and allowing brands to aggregate influencer input. What it means for 2014: As Tumblr’s spread continues to lower the barrier for blogger publishing, and brands become more comfortable with non-mom targets, the blogosphere will continue to evolve with new topics and tribes. But we are retracting our prediction that mommies will “lose control.” Today’s moms remain relatable as ever, adapting to platform changes and holding their ground as master networkers in the online space. UM, NO 22squared © 2013. All Rights Reserved. 12
    • Chapter II: Media. I grew up in a household full of media brains. Literally. My mom was a Media Director at a Fortune 500 company and my dad was in Ad Sales for our local newspaper. Over my thirty-ahem years alive, I’m amazed at how relevant and timely advertising has grown. And I’m amazed at how much I can now tune out ads that aren’t relevant to me.  Whether it’s my Facebook newsfeed, a link I click on from someone I’m following on Twitter, a DJ endorsement on the radio, or the TV spot I see on NBC’s Today Show, if it’s not relevant to me, my brain tunes it out. Recently having had children (3 and 1, thank you very much), having sold and bought a home, as well as started a new job, my brain capacity, much like most of yours, is on what I call a “need to know basis.”  Therefore, any information I come across has to be extremely relevant for me to pay attention — and be motivated to take action.  Multi-Screen Experiences Ads Go Native Sports Wag the Dog User-Directed Content Ecosystems I’m Not an Ad Unit Study after study shows that consumers want and react to relevant advertising. They also want privacy and control over their data. The online ad industry is a good ways ahead, and at this point, I get giddy when I am served an ad that is exactly what’s on my mind and on my to-do list. I can’t wait for that time to occur across all media channels.  Consumers are now able to consume relevant content, on their time, on their choice of device. As someone trying to reach this consumer in much the same way, I’m frustrated by the lack of advertising opportunities to accomplish this. Technology is literally changing the way our brains are developing. In the viral video, “A Magazine Is An iPad That Does Not Work,” and in seeing my own 1-year-old daughter do the exact same thing with her books, I’m reminded how far behind the ad industry can sometimes be in figuring out ways to reach consumers in this age of automation and relevance. Krista Lang SVP, Executive Media Director 22squared © 2013. All Rights Reserved. 13 “Any information I come across has to be extremely relevant for me to pay attention — and be motivated to take action.” 
    • NAILED IT MULTI-SCREEN EXPERIENCES What we predicted: DEC 2012 We’ll see content created for the way people actually consume media: using two or more screens at a time. Savvy brand advertisers will find a way to make the experiences not only connected, but actually augment each other for a more complete experience. What happened: DEC 2013 Marketers are certainly trying to make the most of this trend. All three major video game console makers have based their latest systems on multi-screen behavior. In terms of television, broadcasters and brands are trying to leverage multi-screen usage in a variety of ways. Shazam has become a major player in getting viewers to use their phones to interact with their televisions, while shows like Scandal and Revenge use their stars to draw viewers into conversation on Twitter while the show is actually on. What it means for 2014: While everyone now acknowledges multi-screen behavior as a reality, no brand has fully taken advantage of it in a really profitable way. We will continue to see brands, broadcasters, and telecoms innovate in order to capitalize on the behavior, and successful engagement will go beyond Twitter and TV to include other platforms. In 2014, someone will finally nail it and then the copies will come by the dozen. UM, NO 22squared © 2013. All Rights Reserved. 14
    • NAILED IT ADS GO NATIVE What we predicted:  DEC 2012 Tiny mobile banner ads — the most inane media unit ever — will disappear. Pre-roll digital video that was created first as a broadcast TV spot and then repurposed? That will decrease. Instead, branded experiences that fit the native forms and functions of a platform will increase. What happened:  DEC 2013 Well, mobile banner ads are up, but not as much as in years past. Pundits keep writing about the importance of “going native.” But even with their flaws, mobile banners and preroll are far easier (and cheaper) to deploy than native content, so “going native” is an uphill climb. Our sympathies for the user. What it means for 2014:   The media partners with content and production capabilities will use their value added skills to win the day. They’ll create integrated, custom experiences as part of a media buy. Ad experiences will get more native — and better for users — as the production challenges lower for brands next year. But brands must keep up with a never-ending cycle of meaningful content to stay relevant when going native. UM, NO 22squared © 2013. All Rights Reserved. 15
    • NAILED IT SPORTS WAG THE DOG   What we predicted: DEC 2012 When sports franchises get lucrative TV contracts, they can afford better players. The Dodgers should do better this year, and the Braves not so much (based on their budgets via TV rights). What happened: DEC 2013 In the sports world, financial resources can indeed influence the quality of the team. However, factors like coaching and a variety of intangibles offset this influence. The largest skewing factor is injury, which was largely the reason that the Dodgers and the Braves ended up having very similar seasons. This is not to say that TV contracts do not have an influence; it’s just that the influence is balanced by a variety of other factors. What it means for 2014: The teams with more long-term player contracts and better budgets will be the ones to watch. They have the most potential to succeed, as they have more up their sleeves to pull out when the going gets rough. However, the big factor to watch is the overall wellness of the players and coaches — if they are in good form, regardless of their paychecks — then the team should succeed. UM, NO 22squared © 2013. All Rights Reserved. 16
    • NAILED IT USER-DIRECTED CONTENT ECOSYSTEMS   What we predicted: DEC 2012 Viewers of TV shows and players of games will have more influence over plot-lines and outcomes. And viewers won’t choose between channels, they’ll follow unique and complementary content in a variety of places. What happened: DEC 2013 Sure, a couple television shows tried to encourage viewer involvement, with little success (Psych and Hawaii Five-O asked viewers to vote on plot elements, but neither gained much traction). And while multi-screen viewing is continuing to grow, experiences between platforms are still for the most part lacking cohesiveness. The TV show Defiance on the SyFy channel is influenced by player activities in the video game of the same name, but each property has received only mild-to-middling reviews. What it means for 2014: Media channels and content sources will have to find other ways to capitalize on audience conversation, without trying to turn fans into writers. If content providers can create synergy between platforms and offer added value in the process, consumers should be much more willing to participate.    UM, NO 22squared © 2013. All Rights Reserved. 17
    • NAILED IT I’M NOT AN AD UNIT What we predicted: DEC 2012 As the lines between content and advertising, entertainment and marketing, continued to blur in 2012 (and consumers created content in record-setting fashion) — many companies thought “what can be more personal than content using real people’s information?” But privacy concerns had us predicting the pendulum would soon swing the other way. What happened: DEC 2013 Growing online privacy concerns saw this trend come to fruition. It was epitomized in a controversial incident when a Canadian dating website used an image in a Facebook ad of a young teen who had committed suicide after cyber-bullying. In August 2013, California v. Facebook was settled out of court, with Facebook paying $20M and agreeing to change its practices of “Sponsored Stories.” Although if you’ve seen your newsfeed lately, it’s still full of “John likes this brand”-style messaging. With 684,478 pieces of content shared daily by Americans on Facebook alone — we doubt we’ve seen the last of this questionable practice. What it means for 2014: Online publishers will look for ways to balance the demands of revenue-generating advertisers with the growing concerns of a privacy-sensitive public. Perhaps advertisers will find a way to continue the practice by allowing individuals to approve and monetize their content if it appears in an ad. But Facebook will continue to push its users as branded content to the extent they will tolerate. UM, NO 22squared © 2013. All Rights Reserved. 18
    • Chapter III: Shopping. The predictions for 2014 are pretty consistent across the board: big data will grow up, there will be a diminishing line between online and offline with the growth of wearable technology, and mobile, mobile, mobile will continue to dominate the consumer marketplace.  I'll leave those trends to industry talking heads and instead focus on the one prediction that keeps coming true year after year: I'm not very good at predicting trends. I'll be wrong. I'll eat my words. I'll change my mind in March and contradict something I've published in this trends piece.  Social Shopping Phone-In-Hand Retail Shoppable Content I distinctly remember the first time I saw Facebook — actually back then it was “The Facebook” and it was only open to a few select colleges. I was studying abroad in London and some of my friends who were Harvard students let me take a look at their profiles. "Well, that is dumb," I said definitively.  Having Trumps Owning I told my boss at my first job in New York that Twitter was only for journalists and spammers. I was sure Facebook's graph search would replace Google by the end of this year. You might be asking yourself how I have any job, let alone one that pays me to work in social media.  Palm Point-of-Purchase Gamified Savings But the cool thing about living, breathing and loving this digital/social/mobile space is that it literally changes every day. My now very active Twitter account is filled with smart people spouting gospel about what is going to happen next. And a lot of times they're wrong too. Supposedly "game-changing" companies are tremendously overvalued, bought out in a huge acquisition and then disappear a few months later. On the flip side, a technology that seems to come out of nowhere really does change everything overnight. (I'll let you guess what those examples are.)  Being successful in this space requires a certain level of comfort with uncertainty — which is a tall ask for most marketers. We have a responsibility to make calculated and informed decisions, but playing it completely safe with what we know will work almost never pays off. The magic is in the gamble, the experiment, the pivot.  So I guess the only trend I know to be true for 2014 is that we'll definitely be wrong about some things, but we'll learn along the way and if we're doing our jobs right, we'll take a few risks that pay off tremendously.  But then again, don't quote me because by this time next year, I'll probably be pretending I never wrote this.  Genna Franconi VP, Director of Social Media 22squared © 2013. All Rights Reserved. 19 “We have a responsibility to make calculated and informed decisions, but ... the magic is in the gamble, the experiment, the pivot.” 
    • NAILED IT SOCIAL SHOPPING   What we predicted: DEC 2012 After the awkward beginnings of brand fan pages, we predicted that more brands would begin harnessing their “Likes” into action. Online browsing would be powered by social recommendations and inspiration, and even the brick-and-mortar shopping process would become more of an online conversation. What happened: DEC 2013 As brands realized the value of social conversation, and consumers embraced the ones doing it right, social shopping was everywhere this year. But instead of shopping trips becoming more social, social channels became more shoppable. Brands became more involved in Pinterest and more savvy on Facebook and Twitter — promoting products and rewarding social action and advocacy. Consumers responded at all levels of the purchase cycle: asking social networks for product advice, swapping deals, and sharing photos and comments after purchases. Now 40% of social media users have purchased an item after sharing or favoriting it on Pinterest, Facebook or Twitter (Vision Critical 2013). What it means for 2014: With consumers doing more of their shopping online and in-app, we’ll see more purchases ending in “Share this” clicks, and more deals being powered by likes and tweets. This could have big implications for social targeting, as we’ll increasingly be able to tell what people buy in addition to what they like. Social platforms will help, with features like Pinterest’s Trending Pins and Rich Pins, and Facebook’s continued focus on performance-driven media. UM, NO 22squared © 2013. All Rights Reserved. 20
    • NAILED IT PHONE-IN-HAND RETAIL What we predicted: DEC 2012 Accompanying the dramatic surge of smartphone usage across the U.S., the share of consumers who shop in-store with phones in-hand will inevitably proliferate. Mobile browsing, price-comparison, and search-based shopping will continue to grow and become more of a “way of life” than a supplementary bonus to an in-store experience. What happened: DEC 2013 Millions of consumers continue to position their smartphones as an integral part of their shopping journey, but not as a replacement for the in-store experience. The ease and convenience of “couch commerce” paired with the phenomenon of showrooming has sweetened the appeal of mobile as a shopping tool, but we see the craving for physical features and first-hand experience still persists among the 90% of consumers who preferred to shop in-store this year. This has sparked a new wave of mobile features that make the instore shopping experience quicker and easier — from geo-targeted and personalized offers and mobile in-store check-out (Nordstrom) to customized shopping lists, inventory info, and augmented reality (Kohl’s, Macy’s, Amazon). What it means for 2014: Consumers will continue to adopt multi-channel shopping behaviors that best fit their lifestyle and satisfy their need for instant information. The path to conversion will not get any easier. Expect brands to focus less on deal-based tactics and more on building relationships, loyalty, and mutual interactions throughout the year to maximize their impact with their audience. UM, NO 22squared © 2013. All Rights Reserved. 21
    • NAILED IT SHOPPABLE CONTENT What we predicted:  DEC 2012 TV shows, movies, and magazines will take product placement to the next level; viewers can pause, click or scan, shop, and purchase the outfits of the lead characters, the car the hero drives, or the steak the villain eats. Thanks for buying, you may now resume your editorial. What happened: DEC 2013 People Magazine on tablet became one of the best mass-shoppable content plays around. Also see Esquire on tablet, and Cosmopolitan (powered by Shop Advisor). “Shop this ad” turns browsing into shopping. In other news, Target tried a shoppable TV ad, and the Shazam music app is still used in TV spots, though it’s an odd way to connect TV to shopping. What it means for 2014:   We’ll see more attempts to make content shoppable. We may see content genres, media channels, and viewer segments distinguish themselves as those most likely to succeed. (E.g., “Millennials are more likely to shop in content” or “Full-length Hulu episodes are most likely to be shopped in content” or “Teen family programs are most likely to be shopped in content.”) That way brands will know better what to expect for campaign performance. UM, NO 22squared © 2013. All Rights Reserved. 22
    • NAILED IT HAVING TRUMPS OWNING What we predicted: DEC 2012 Old-school categories with high overhead will be replaced by new business models: Uber replaces taxis. AirBnB replaces hotels. Pop-up shops will replace long-term retail leases. TaskRabbit will replace GirlFriday temps. People will rent their homes instead of owning. Why would a new business take on overhead if it can avoid it and disrupt its category in the process? What happened: DEC 2013 More people are minimizing risk in a purchase (corporate and consumer alike). The luster of technically “owning” is being replaced by the joys of easy access. This year saw Uber expand quickly and judiciously. AirBnB has grown to over 300,000 listings around the world. Avis saw Zipcar’s potential and bought it — to the tune of $500 million. Online, streaming content is replacing downloading across all media (like Spotify and Hulu). What it means for 2014: Informed shoppers will find more alternatives to big-ticket purchases (hotels, furniture), and alternatives to poor experiences (cabs). More start-ups will find mature markets to disrupt by innovating with lower overhead. With the mass market changing its expectations of “ownership,” rent-to-own could start appealing to a much larger group. UM, NO 22squared © 2013. All Rights Reserved. 23
    • NAILED IT GAMIFIED SAVINGS What we predicted: DEC 2012 In 2012, JCPenney taught us that consumers want to “see the savings.” For 2013, we predicted consumers would want to feel like they literally “won” the transaction. Enter the savings game, where consumers play and brands fuel the fire, perhaps even rewarding consumers with points and special savings for finding great deals and bragging to friends. What happened: DEC 2013 Deals are definitely here to stay, as seen by the growing popularity of mobile apps like RetailMeNot and Flipp. But the gamification of deal-seeking is slower going. One retailer who has succeeded here is Target, with the Cartwheel app. Cartwheel provides consumers with deals found nowhere else, and allows them to use these deals on top of other coupons and discounts. In addition, the more you use Cartwheel deals and the more you share those deals with Facebook friends, the more savings you earn. Finally, all saved Cartwheels are stored to a barcode that’s scanned at checkout and lets you know just how much you saved — providing that final sense of “winning the transaction” consumers are seeking. What it means for 2014 After seeing the success of retailers like Target, more brands will begin to provide special savings to their customers and add gaming elements into their savings programs. Even loyalty programs will add gaming elements beyond the standard “points for purchases” we see today. Finally, apps like RetailMeNot will move beyond merely being a place to find and store deals to becoming an entertaining way to engage, making deal finding even more fun and rewarding. UM, NO 22squared © 2013. All Rights Reserved. 24
    • NAILED IT PALM POINT-OF-PURCHASE What we predicted: DEC 2012 With smartphones becoming as common as credit cards, it seemed likely we would start using them that way. We predicted significant increases in mobile purchases for 2013, with more consumer trust and retailer attention for the platform. What happened: DEC 2013 With a spike in tablet ownership and huge strides in retailer shopping apps, we made record purchases from the palms of our hands this year. Mobile commerce sales are up 15%, accounting for 16% of all e-commerce in 2013 (eMarketer 2013). The mobile and offline shopping worlds collided, but not with Apple Passbook or Google Wallet. Instead, brands like Dunkin’ Donuts, Chipotle, and Starbucks (with Square) had us paying for in-store purchases on their own mobile apps. What it means for 2014: Consumers will continue relying on mobile devices to shop anytime, anywhere, and take advantage of time-sensitive deals. We expect mobile payments will also increase, as more stores and restaurants get in on the action, and new technologies try to replace the Google Wallet flop. Square’s success will open doors for more and more seamless transactions on the go. UM, NO 22squared © 2013. All Rights Reserved. 25
    • Chapter IV: Technology. Late last year, when I was asked to give thoughts around what 2013 would look like in terms of technology trends, my hope was that we’d finally start to gain momentum on the promise of “The Internet of Things.”  Most products that live in this space (smart watches, connected thermostats, fitness/activity monitors, etc.) are still primarily in the hands of the tech-elite. These devices promise us everything from helping to cut our electricity expense (the Nest thermostat, for example), to making us healthier (Nike+ Fuelband). If these devices can truly deliver on their promises, why are there so few of them in the hands of consumers? My theory is that it is much more about trust than availability or technical savvy.  We all struggle with issues of trust when it comes to technology. There isn’t a person I know who hasn’t experienced the gutwrenching feeling of losing hours of work due to an application failing. When we add more technology to our lives, I think a part of us is fearful that we’re inviting in more opportunity for failure. If my computer crashes these days, it’s no big deal. I have a backup. But if my Nest goes out at 2 a.m., do I have a backup in place to operate my HVAC system? Digitized Life Algorithms Harness Data Social TV Platform Gap TV Control As we move into 2014, I’ve no doubt that connected consumer electronics will continue their push into our homes, our cars and even our bodies. These devices will enable an entirely new way of interacting with our world.  Everyday run-of-the-mill household items will evolve from “dumb” to “smart.” But as we invite this technology into our everyday lives, we have to assess the risk that comes along with it.  From a marketing perspective (and as a consumer), the opportunities that connected devices present are exciting. I long for the day when my refrigerator will tell me that I’m low on milk, or my washing machine will let me know that I’m out of Tide. If a brand can provide offers at the right time, then the message feels a lot less like an advertisement and a lot more like a gift. But this, too, has the potential for abuse. As creators of brand experiences, we marketers have to use the data that devices share with us responsibly; otherwise we run the risk of the consumer shutting us down. David Reeves SVP, Director, Creative Innovation and Development 22squared © 2013. All Rights Reserved. 26 “If a brand can provide offers at the right time, then the message feels a lot less like an advertisement and a lot more like a gift.”
    • NAILED IT DIGITIZED LIFE What we predicted: DEC 2012 If 2012 was lauded as “the Year of Mobile,” we predicted 2013 would take technology a step further by weaving it into the fabric of decidedly analog experiences. Now that consumers were becoming accustomed (one might say “entitled”) to work, chores, and even social interactions being managed at the touch of a screen, it seemed only logical that our homes, cars, and bodies would become the next frontier. What happened: DEC 2013 The trend paid off big-time in 2013, with brands as varied as Samsung, AT&T, Nest, and ADT betting big on digital platforms to create a connected home experience. Technology ranging from hardware (like Nike’s wildly popular FuelBand) to smartphone apps (like MyFitnessPal) digitized the personal training and exercise space. And CES saw the debut of the first officially “self-driving” car from Audi. What it means for 2014: We expect this trend will take a step even closer to the human body in 2014, with the rise of implantable smart technology going beneath the skin, and with continued growth in the areas of wearable technology that sits atop it — which in time may change everything from how doctors operate to how servers wait tables. UM, NO 22squared © 2013. All Rights Reserved. 27
    • NAILED IT ALGORITHMS HARNESS DATA   What we predicted: DEC 2012 In 2013, we predicted smart brands would begin to realize algorithms were the key to using big data successfully. As a result, we predicted there would be a major influx of new algorithms built by individuals and purchased by brands looking to apply them to their data and target their consumers. What happened: DEC 2013 2013 saw new algorithms introduced almost daily. Some diagnose and help treat disease, others recommend travel itineraries based on preferences and past activities, and still others combine your preferences with your current mood and serve suggestions for music to listen to, restaurants to visit, and products to buy. Some big online brands like Facebook, Google, and LinkedIn have continued to purchase new and update current algorithms, but there were not many newsworthy algorithm purchases or reveals on the brand side. What it means for 2014: We imagine some of the bigger product brands out there have been working on proprietary algorithms over the past year and there will be some interesting reveals in 2014. This will cause other brands to take notice and start working on their own, or buying from third parties. Finally, we predict algorithms will get closer and closer to using “non-spoken data” to personalize consumer experiences even further. Think retina scanning, facial recognition, reading emotions, detecting sleep patterns, sickness, etc. This is already beginning and we’re excited about the possibilities (and maybe a little creeped out too). UM, NO 22squared © 2013. All Rights Reserved. 28
    • NAILED IT SOCIAL TV What we predicted: DEC 2012 As social media becomes the primary focus around real-time television integration, choosing what TV shows to watch will be based on what friends watch and like — on your TV. What happened: DEC 2013 Social and TV have yet to become completely integrated. TV discovery platforms like GetGlue, Viggle, and Miso were well-funded, but still lack the scale and traction of established services people already use, like Twitter and Facebook. Meanwhile, without real-time curation and a skewed noise-to-sound ratio, Hashtag TV just hasn’t quite left its own echo chamber either. What it means for 2014: Social media will be able to support communication and social interaction regarding watching TV and anything linked to TV programming. New social-plus-media partnerships will launch targeted ads appearing on social media that are relevant to what TV shows individual users are talking about. We hope Santa brings us true social TV in 2014 — we’re ready for it! UM, NO 22squared © 2013. All Rights Reserved. 29
    • NAILED IT PLATFORM GAP What we predicted: DEC 2012 Social media channels will become less homogenized, more segmented. For example, Pinterest skews female. Instagram will draw a huge line between Millennials and Gens X and Y versus the Boomers who won’t adopt. Look at Tumblr – it’s not “everyone.” And SnapChat? Don’t get us started. What happened: DEC 2013 Social networks have become more homogenized and more segmented. Today’s Internet age means there is something for everyone — and many groups do embrace certain networks, like Pinterest for white women or Snapchat for youth 13-23 (Pew 2013). But there are other networks that attract broad audiences: Facebook may have given up some ground with youth, but it’s not losing steam anytime soon in terms of a diverse user base. What it means for 2014: Brands will become savvier about how they curate custom content and experiences based on platforms’ unique audiences. (A timely example? This year we worked with one of our clients to launch a new product targeted to urban Millennials on Tumblr.) But brand marketers will still look for ways to get the most bang for their buck with platform plays that have a lot of broad appeal, swapping specificity for reach. UM, NO 22squared © 2013. All Rights Reserved. 30
    • NAILED IT TV CONTROL What we predicted: DEC 2012 In 2013, we thought the remote control would keep pace with other technology innovations. Whether it’s our phones as the remote or using our voices to dial in our favorite TV shows, it didn’t seem outlandish to beat the current cable channel menu’s UX nightmare. What happened: DEC 2012 We saw the Samsung Galaxy S4, HTC One and a smattering of tablets sporting features that allow users to control their TV and home theater systems with the touch of an app. And DirecTV has recently rolled out a voice-controlled TV platform. However, widespread adoption of this new technology has yet to replace the traditional clunky remote, since people don’t buy new TVs all that often. What it means for 2014: Please, someone solve this. Let 2014 be the year of the stand-alone social remote control. On the heels of a new partnership between Twitter, NBCUniversal and Comcast, a feature is currently in the works that will let viewers change the television channel from a tweet or DVR an upcoming episode. We remain ever hopeful. UM, NO 22squared © 2013. All Rights Reserved. 31
    • NAILED IT (5) PALM POINT-OF PURCHASE HAVING TRUMPS OWNING PHONE IN HAND RETAIL SOCIAL SHOPPING TREND KEY: CONSUMER MEDIA SHOPPING TECHNOLOGY MULTICULTURE-ALL   DIGITIZED LIFE SHOPPABLE CONTENT PENT-UP PASSION PURSUITS PLATFORM GAP POWERING DOWN ADS GO NATIVE ALGORITHMS HARNESS DATA SPORTS WAG THE DOG GAMIFIED SAVINGS USER-DIRECTED CONTENT ECOSYSTEMS 3.4 2.5 3.9 2.9 BIG DATA FOR ME I’M NOT AN AD UNIT MULTI-SCREEN EXPERIENCES AVERAGES (1-5 scale): CONSUMER TRENDS: MEDIA TRENDS: SHOPPING TRENDS: TECHNOLOGY TRENDS: TRANSPARENCY FATIGUE MOMMIES LOSE CONTROL   Every December, my inbox is filled with great thinking on trends from really smart people. They inspire us, and show us what’s possible. But are they … right?   This year, we’re holding ourselves accountable. We hope we start — well, a trend.   Our highest-scored category was Shopping Trends. That’s good, since many of our clients are in retail. It means we’re paying attention — staying ahead.   Our lowest-scored category was Media Trends. I look at this score — and at the minds these ideas sprung from — and see that our agency has incredibly high hopes for media’s potential. As we imagine improvements in the capabilities of the space, we can’t help but be impatient with the current state of affairs.   Frankly, I’m okay with scores that don’t make us look like know-it-alls. It keeps us excited to get out of bed in the morning, imagining what’s next to come. We can’t help but wonder how other top trend-spotters scored —that is, if they bothered to look back. In any case, we know we’re looking forward to seeing where we land and what we learn next year. TV CONTROL SOCIAL TV David Yeend VP, Planning Director UM, NO (1) 22squared © 2013. All Rights Reserved. 32
    • Afterword. Humanity continues to amaze us. We are humbled by the speed at which people adopt technology and bend it to their basic human needs of expression, gratification, control, connection, conversation and achievement. We are in an age of constant change. Our challenge, as an idea enterprise and brand stewards, is to help our clients keep up and capitalize on the many new ways they can add value to the lives of people. Whether it’s watching a YouTube video, shopping on our mobile phones or getting the opinion of 50 friends instantly, our lives are imminently better and different because of technology. Sure there are downsides. Sometimes we sacrifice the physicality of life for the digital life. Sometimes we are more open to manipulation, privacy invasion, or fraud. But on the whole, life is better, easier, safer and more fun because of technology. It’s difficult to remember life before touchscreen. Before YouTube. Before Facebook. Before we had our choice of a dozen channels to talk to people, reach out to brands, buy cool stuff, be entertained or get the answers we need. And now, we’re connecting with an entire generation of consumers who grew up with this reality. The possibilities are limitless. As my favorite superhero teaches us, “with great power comes great responsibility.” As storytellers, brand stewards and idea people, we are called to use these channels for good. To add value to people’s lives while marketing brands at the same time. Not only is technology allowing people to consume more content and experiences than ever, it’s also helping them avoid it: filtering what they want and personalizing their experiences and life streams with great precision. Despite the multitude of connection opportunities, only the brands that are enriching peoples’ life moments will get through. While our success at predicting (or not predicting) 2013 trends certainly varied, we look ahead to next year with a sense of responsibility and purpose. We hope you find value in our honesty, insight, guesses and points of view. Thanks for thinking with us. Brandon Murphy EVP, Chief Strategy Officer 22squared © 2013. All Rights Reserved. 33 “Despite the multitude of connection opportunities, only the brands that are enriching peoples’ life moments will get through.”
    • 22squared © 2013. All Rights Reserved. 34
    • IMAGE SOURCES http://www.flickr.com/photos/mdorn/116510266/sizes/l/ http://www.flickr.com/photos/blakespot/6860486028/sizes/l/ http://www.flickr.com/photos/derekskey/9318696045/sizes/l/ http://www.flickr.com/photos/small_realm/11190294034/sizes/l/ http://www.flickr.com/photos/lidocaineus/7001025817/sizes/l/ http://www.flickr.com/photos/scobleizer/4697192856/sizes/l/ http://www.flickr.com/photos/sfllaw/509244422/sizes/l/ http://www.flickr.com/photos/wonderlane/5351344293/sizes/l/ http://www.flickr.com/photos/jasonahowie/8583949219/sizes/l/ http://www.flickr.com/photos/edsel_/8728283431/sizes/l/ http://www.flickr.com/photos/leyla_arsan/5530442112/ 22squared © 2013. All Rights Reserved. 35