What if we’re just talking ourselves into all of this?
Admittedly, I partied too much in college to get good enough grades to go to a respectable grad school to become an economist. I’m out of my league here.
I’m also old enough to remember when a ton of experts I respect introduced the word “transitory” into my everyday vocabulary 18 months ago. I guzzled so much of that Kool-Aid, my Biden-hating high school friends on Facebook are still dunking on me about it.
It makes you wonder why today’s chorus of doomsaying is any more prescient. If all the luminaries are so sure economic winter’s approaching, why didn’t they warn us last year? Where were the alarm bells when homes were selling for 20% over list in a minute? Of course we were going to have massive supply chain issues when quarantine faded and all that pent-up spending was unleashed. Duh!
If anyone foretold all this, I never heard it, and I keep my professional ear closer to the ground than most. At least there are outliers now. Scott Galloway, one of the most thoughtful minds on the landscape, has posited that inflation could fall as fast as it climbed. That’s the list.
Meanwhile, there’s enough counterintuitive negativity out there to make your brain hurt.
“Oh no! The job market is too good. Wages are growing too fast! Employees have too much leverage in the workplace! The dollar’s too strong! People’s homes are worth too much! We’re all screwed!!!”
I don’t claim to understand the economy. But our company understands people better than anyone. And to people – normal, coach-flying, grass-mowing, Applebee’s-eating people – none of that makes any sense.
So, we go back to our happy place, blaming politicians and warring amongst ourselves, even as economic crises are worse everywhere but here.
And the prophecy fulfills itself.
Better safe than sorry, the behemoth employers prophylactically implemented their hiring freezes and cut back on advertising to preserve record profits. Up go the interest rates and job losses. Down go the housing starts and wages. Workers, you better get back in the office – or else! Good luck unionizing, LOL.
Normally, a waning stock market would at least shrink the national wealth canyon, except the haves are sitting on an unprecedented amount of cash, while the have-nots are still trying to catch their kids up at school. The linings aren’t even silver.
Alas, it has been ordained.
And we’ll never know what could have been.
Here’s what we’re seeing:
Unionization could become a new pillar of socially-driven consumer choice. Support for labor unions in America sits at nearly 2-to-1, with 50% of people saying they’re fans and 27% saying they’re not. Political lines are divided as you would expect. For all you brand executives out there, union supporters are far more likely to spend more money at companies that allow their employees to organize. Moreover, nearly half of all U.S. consumers say they are LESS likely to shop at businesses that take retribution against employees who attempt to unionize. Expect this to become a new battleground in politically-driven consumerism in the years to come. (CivicScience Clients: If you want to see how your specific customers stand on this issue, we’re already tracking that.)
Amazon’s Prime Early Access Sale frontloaded holiday shopping even further. A full 30% of U.S. adults reported making at least one purchase during Amazon’s first-ever, second Prime Day event last week – down just two percentage points from the number who reported shopping on the OG Prime Day in July. Notably, 45% of those shoppers reported buying one or more holiday gifts during the latest event, further accelerating the trend of earlier and earlier stocking stuffing. One notable difference between Prime Day II and Prime Day I is that far more people ran into out-of-stock items this time around – perhaps because of that, a larger percentage also reported buying items they weren’t planning to buy. Consumer spending remains strong.
As Netflix’s new ad-supported subscription nears, our weekly tracker is showing a modest increase in intent. Everyone at Advertising Week was abuzz (and/or terrified) about Netflix’s blockbuster move into advertising next month. Consumer intent, meanwhile, nudged upward since we last published our data a few months ago. Roughly one-third of current NFLX subscribers say they’ll likely switch to the ad-supported version, while one-fourth of non-subscribers say they’ll likely sign up. The ad-tier intenders skew lower-income (unsurprisingly) and 55+. Notably – particularly if you’ve ever seen “The Netflix Parable” in my current executive talk – these new intenders do NOT over-index as Republican or rural.
I opened for Kanye this week. Chris Cuomo invited me back on his show, in studio this time. Unfortunately, the segment wasn’t called “You Don’t Know Dick,” but apparently that’s not the vibe they’re going for. We railed on the evils of political polls and how they drive discord and scientific distrust in our country. Kanye or Ye or whoever came on afterwards and let’s just say it was something.
Online thrift shopping is on the rise, driven big-time by Gen Z. The number of U.S. adults who say they’ve made a purchase from online second-hand retailers like Poshmark is up almost 100% since this time last year. Same goes for people who’ve sold merch on these sites. The increase is overwhelmingly driven by Gen Z. And, while a lot of the appeal seems to be discounted prices in the face of economic headwinds, the popularity of nostalgia (see: Stranger Things) and unique finds is a major motivator as well. Big retail might be missing out on this trend.
Speaking of nostalgia, the popularity of McDonald’s adult Happy Meals is off the charts. If you’re half as good at marketing as the folks under the golden arches, consider yourself blessed, because they play a different game than everyone else. In our trend-tracking models, we consider any product where intent and usage are 1-to-1 a winner with big upside. Well, adult Happy Meals (no, they don’t have Tito’s and edibles in them) are currently running at nearly 3 (intent) to 1 (usage). That’s just silly. The biggest predictor of interest in the product is whether people regularly got Happy Meals as a kid, which just confirms the incredible, unmatched lifetime value of Mickey D’s brand.
More greatness from the CivicScientists this week:
- Electric toothbrush satisfaction is on the decline, water flossers are on the rise, and Oral-B dominates;
- Adults who dress up for Halloween love Chipotle and beer, while I’m a person who loves Chipotle and beer but will not dress up for Halloween.
The top questions this week:
- Do you only show the good parts of your life on social media?
- How often do you experience existential dread?
- Would you rather always be in the driver’s seat or never in the driver’s seat?
- What size hamburger is the best-sized hamburger?
- Do you spend most of your time thinking about the past, present, or future?
Answer Key: Of course; Whenever I wake up at 3 a.m.; Driver’s seat; 1/2 lb.; Great question – the present.
Hoping you’re well.
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