Consumers are price-focused because we're in a recession. Right? As soon as we get to the other side -- maybe 2010, 2011 at the latest -- people will return to their old habit of pursuing the pleasures of life to the full extent that their salaries and credit lines will allow. Right?
Wrong, says Madelyn Hochstein, president of DYG, a consumer research company that tracks changes in social values and then provides marketing advice to some of the world's largest consumer brands.
Last week, I was permitted to listen in as Hochstein told some of her clients that America's societal values have taken a significant lurch into new territory. She presented research that strongly suggests consumers are not merely finding necessary virtue in thrift, they are exalting in it. Further, they are also embracing ethical behavior, self-reliance and competency.
Consumers are not bargain-hunting only because they're financially insecure, but also because it gives them status among their friends. And these days, humility and competence, especially in combination, are not just admirable, they're heroic.
Until recently, Americans worshipped "wizards" whose methods seemed magical (think Alan Greenspan), but today we lionize modest people whose competence saves the day when applied in extraordinary circumstances (think captains Sullenberger and Phillips).
Just as the sexual revolution of the 1960s changed society's views on premarital sex and the health revolution of the 1970s led us to believe that our well-being was not solely in the hands of the medical establishment, DYG believes the "responsibility revolution" of 2009 is producing profound, long-term change.
Consumers, having felt they were not well-served by wizards, are into self-reliance. It dovetails nicely with thrift: Why send your poodle to the doggie spa to be shampooed or hire someone to mow your lawn, when you can do it yourself and take pride in it? Excess is out. Do-it-yourself is in.
All this is not necessarily good news for a service industry that provides advice about travel products, especially when the most profitable products are purchased with a dollop or two of self-indulgence, a bit of pampering and a soupcon of excess. The do-it-yourself trend and rejection of luxury, if applied to travel, could mean the reset button is about to be pushed -- again -- for travel agents and suppliers alike.
On the same day that I heard the DYG presentation, I had appointments to speak with two luxury hoteliers. I shared the conclusions of the research with them.
Jill Kluge, group director of brand communications for Mandarin Oriental, said she felt her hotel group was well-positioned for this shift in values. "We have an advantage over companies that provide 'gimmicky luxury,'" she said. "We're not ostentatious; we're not bragging about having seven stars. We do things from the heart, and our customers embrace us for it."
Pierre Zreik is general manager of the Allison, a resort scheduled to open in September in Oregon's Willamette Valley. Its management hopes it will be to Oregon's wine country what Meadowood is to California's Napa Valley.
Zreik seemed buoyed by my description of the research. "These are already Oregon's values," he said. "We're not over the top. We're understated. We will give value for the dollar. And service will make it the premier property in the area."
Are Kluge and Zreik fooling themselves? Will consumers differentiate between good luxury and bad?
Perhaps they will. Hochstein said that "the culture of excess may vanish overnight," but these new trends might also play to brand reputation and brand loyalty. There is an opportunity, she said, for brands to tell ethical stories. There was a huge leap (10 points, to 55%) this past year in the number of consumers who said they would boycott companies that stood in opposition to their values, and a fair number (51%) said they would seek products that match their social, political or environmental goals.
Trust is central to the change in values. The new consumers want their spending to reflect what's in their hearts and heads. Consequently, consumers will expect more responsibility from the companies with which they do business. They will expect integrity.
It seems likely that both the Allison and Mandarin Oriental could align themselves with emerging values, but the market has recalibrated in another way that will make a difference for every business, regardless of whether they have a good story: "Your No. 1 competition will be that consumers feel good when they save rather than spend," Hochstein said. "They take pride in not buying. Our economy, of course, is driven by consumer spending. This is radical."
And then there's the question of the do-it-yourself trend and its implications for travel agents and vacation packagers. While on one hand Hochstein says things will not return to the old norm, do-it-yourselfers might ultimately conclude that there are some things best left to professionals. And if they do reach this conclusion, agent-client relationships could be stronger than ever.
Even if DYG is right, not everyone will behave in accordance with the new standards. The sexual revolution did not mandate that everyone participate in an orgy, and 40 years after the dawn of the health revolution, there are more obese people than ever.
By the way, I just checked: The DoItYourselfTravel.com domain has been claimed.
Contact Arnie Weissmann at [email protected], or follow him on Twitter at Twitter.com/awtravelweekly.