Each month our team identifies Basis Technologies’ top 10 verticals and shares the trending news stories and important stats with you!

FINANCE

  • The U.S. is experiencing a period of inflation and it is expected to stick around. In September, the year over year consumer price index increased by 5.4% which is the fastest growth period seen in decades. This impacts everyone in the U.S., but those close to retirement are especially concerned. 71% of retirement age investors are worried that the current rate of inflation will have a negative impact on their retirement savings. This is a key time for financial advisors to promote their services to an older, maybe less conventional, target. This target needs advice and tips on how to keep their long-invested retirement account in healthy conditions despite the current state of the market. Source: CNBC/Global Atlantic Financial Group, October 2021
  • Individuals in the U.S. far underestimate how expensive it is to raise children. According to the U.S. Bureau of Agriculture, the average middle-class family spends between $12,350 to $13,900 annually to raise a child. The under forecasting of expenses is due to less commonly thought of costs such as family health insurance plans, higher rent/mortgage payments for larger living space, and placing funds into college savings accounts. To prepare most effectively for this period of life, consumers must adjust many of their spending/saving habits and purchase additional protectors, like life insurance, far in advance of having children. Financial institutions and advisors should consider targeting younger individuals by promoting the importance of their savings accounts, investment opportunities, and debt payment options to better prepare them for any future families they may choose to have. Source: CNBC, October 2021

BUSINESS & INDUSTRIAL

  • Industrial production in the U.S. dropped by 1.3% in the month of September, which is a far larger drop than expected. Of this 1.3% drop, 0.6% was due to effects from Hurricane Ida. In addition to consequences of the natural disaster, economists report that the drop in production points to issues in supply chain with both raw materials and labor. This indicates a future filled with more delays in goods to U.S. consumers. To provide transparency to their customers, brands and retailers must alert their customers to their continued delayed production/shipping times and encourage early purchases. Source: CNBC/Federal Reserve, October 2021
  • As previously discussed, B2B purchases are turning digital. The share of check & cash B2B purchases is expected to drop from 53% in 2018 to 42% in 2022 as the industry digitizes. In the digital advancement, Veem, a B2B payment firm, partnered with Visa to allow clients to create virtual Visa cards to make B2B purchases. This is a major perk for B2B buyers as it saves time and reduces the risk of fraud. To stay relevant in the B2B industry and speed up transactions in a historically slow industry, brands must improve their digital payment options, especially considering Veem, and promote the benefits to this advancement. Source: eMarketer, October 2021

HEALTH

  • Trust in the pharma industry has always been low, mainly due to the lack of transparency and extremely high prices. It was anticipated that trust in the pharma industry would increase following the positive impact on the pandemic made by the vaccines produced. However, Accenture’s 2021 study showed that only 15% of U.S. consumers said that they now trust pharmaceutical companies more than they did prior to the pandemic. Individuals do have greater trust in their healthcare practitioners, which leaves a strong avenue for pharmaceutical companies. Instead of focusing so heavily on the consumer side of the business, pharma companies would have the greatest success in the B2B realm. Pharma brands must consider investing an even larger portion of their ad budget to the prescribers rather than the end users. Source: eMarketer, August 2021
  • The FDA has proposed to allow individuals with mild to moderate hearing loss purchase hearing aids without prescriptions. There are an estimated 37 million individuals in the U.S. with impaired hearing, the majority of which do not have access to hearing aids, and this allows them to easily access the help they need and at a lower cost. This news is also anticipated to increase the competition in the hearing aid market. Brands currently in this space and those who will be new to it, will need to find ways to differentiate themselves from the increased competition. Media discussing the specific benefits of their product will help set their brand apart from the others in the market. Source: The New York Times, October 2021

FOOD & DRINK

  • We are familiar with a multitude of industries, like auto and home goods, facing manufacturing shortages, however this supply chain issue is also impacting QSRs. KFC announced that they have been unable to promote their chicken tenders due to the shortage in off-the-bone chicken. Popeyes had to stockpile their frozen chicken supply for six months before they were able to launch their chicken nugget product. And Starbucks has had to place holds on 25 menu items, including some flavor syrups, due to shortages in supply. Because of these shortages, food service advertisers must have a wide array of creatives ready to use based on their current product availability. QSRs will find most success by keeping their campaigns generic and not product specific at this moment. Source: eMarketer, September 2021
  • We have previously discussed that drive-thrus are in hot demand with usage not expected to decrease, and many QSRs are increasing their supply of the service. Due to changes in consumer habits, Starbucks announced that they are placing more emphasis on “convenience-led formats” since their on-the-go orders increased 10% in the past year. They plan to open more drive-thrus, pickup locations, and video ordering experiences. Taco Bell has announced their Defy creation that will be a tech-focused drive-thru with four drive-thru lanes. Chipotle announced that of their 200 new restaurants opening in 2021, 70% will have Chipotlanes, which is their “digital order drive-thru pickup lanes.” QSRs are listening to the consumers’ wants and are getting creative in their drive-thru offerings. To best compete in this space, QSRs will need to prove the benefits of their products and display their innovative experiences. Source: eMarketer, September 2021

JOBS & EDUCATION

  • Job security has ebbed and flowed throughout the pandemic, however this last month has provided increased job security, especially for lower income individuals. In October, the inequality index dropped following a sharp increase in September due to Delta variant concerns. This also points to more individuals in this demographic becoming employed in the month of October. As individuals making less than $50K are most likely to take jobs now, companies looking to hire employees in this income group should increase their investment in recruitment campaigns at this time. Source: Axios/Morning Consult, October 2021
  • Higher education has historically been inequitable. However, many universities and governments are working to increase diversity and inclusion. Amherst College, one of the most prestigious colleges in the country, recently announced that they will end legacy admissions meaning they will no longer give priority admission to children and grandchildren of former graduates of the school. On average, legacy students comprise about 11% of the entering classes at Amherst. By no longer giving priority to those who are children of college, let alone prestigious university, graduates, Amherst will increase diversity in their classes. Amherst College is leading the way in unique approaches to increasing equity and inclusion. To follow trend, colleges & universities will need to adjust their enrollment strategies and keep the public aware of their initiatives through captivating media campaigns. Source: Forbes, October 2021

HOME & GARDEN

  • The housing market in the U.S. is strong following the influx of individuals reassessing their living situations during the pandemic. However, the market is struggling to meet the demand. To stabilize the market new properties need to be built, yet in September, the number of new housing permits and building-starts decreased by 7.7% and 1.6% respectively. The drops are mainly due to the shortages of labor and raw materials. Due to the shortage in supply, we expect prices in this market to continue increasing until some buyers are priced out of the market. To find success in this challenging market, contractors and new homebuilders should consider targeting individuals with higher budgets, while realtors should work on building trust and awareness during this confusing time. Source: Axios/FRED, October 2021
  • It is no surprise that many have seen a more personal side of their coworkers in the past months due to remote work. In a recent survey, 54% of U.S. remote workers admitted to judging their coworkers home décor and furniture during video calls. While people were initially doing the best they could in a haste, remote work is now permanent for many, and change may be needed. More than half of remote workers have not redecorated since 2020. And while nearly half of remote workers did buy new home office furniture, it was found that remote workers became tired with their former décor/furniture within an average of three months. Following this trend, remote workers who did purchase new items are likely already tired of their recent purchases. Furniture and décor brands can help remote workers feel refreshed and more confident in front of their coworkers through showing the benefits of designing new spaces in their media campaigns. Source: People/Oliver Space/One Poll, October 2021

SHOPPING

  • The 2021 holiday season is expected to see the largest growth in sales in 20 years. This year, U.S. holiday retail sales are set to reach $1.15 trillion, an increase of 9% from 2020. There are two leading reasons for this large increase: additional money to spend this year and strong demand. Many U.S. families have received additional stimulus pay from child tax credits giving them increased disposable income this holiday season. Additionally, savings rates are currently at 14.2%, which is far higher than previous years, giving individuals more comfort in spending this year. Finally, there is increased demand following a year of isolation. As consumers plan to return to holiday celebrations in 2021, gift giving will grow at an all-time-high rate. This increased demand will be hit with supply issues likely causing prices of some goods to increase. Brands must prepare now for the high demand this holiday season and may consider early sales and discounts to promote advanced holiday shopping. Source: eMarketer, October 2021
  • Consumers are driven to purchase by sales and discounts more than any other factor. Three in five U.S. consumers said that sales and discounts influence them to purchase a product through social media ads making it the leading factor. Meanwhile, 44% said the brand being trustworthy and respecting their data influences them and 34% said the ad being eye-catching. While brand ethics and physical ads are important, the most influential purchase driver is a discount. Sales are especially important in the holiday season. To remain relevant, especially in this extremely competitive time, brands must offer sales frequently and make them the main messaging theme in their media this holiday season. Source: eMarketer, October 2021

AUTOS & VEHICLES

  • Like buyers in many other industries, car shoppers are becoming more comfortable with online auto purchases as they were forced to adapt due to the pandemic. Still, most buyers prefer a digital and in-person purchase method. When it comes to research, many use digital methods. 52% of U.S. auto intenders read online consumer reviews, 44% read online professional reviews, 37% read online dealership reviews and 23% look to social media. When it comes to the final choices, 65% rely heavily on test drives and 53% visit multiple dealerships to compare models & prices. And while 35% of U.S. consumers don’t enjoy going to auto dealerships, 64% need to see a vehicle in person before purchasing. The pandemic pushed the industry towards digital, but auto consumers are still hesitant on a fully digital purchase process. It is expected that a hybrid purchasing approach will continue in the near and far future. This further pushes the importance of digital advertising among car dealers. Since much of the beginning research is done online, auto dealers must have a strong digital presence through both paid and owned media. Source: Mintel, September 2021
  • It is no surprise that the auto industry is in a major state of flux due to the chip shortage. However, there is a new shortage that the auto industry must be aware of: magnesium. It is anticipated that the major magnesium shortage in China, the world’s leading industrial magnesium producer, will cause a wide shortage of aluminum further impacting the auto industry. Still, the U.S., while far smaller than China, is a significant producer of magnesium. This may protect the U.S. domestic auto industry though it will still likely have impact on the foreign auto market. Upheaval in the auto market is not new and both auto brands and dealers will need to find alternative strategies in this unpredictable time. Auto dealers should continue to build brand awareness/loyalty and promote their used car lots or the new models with ample stock. Source: GM Authority/Financial Times, October 2021

POLITICS, LAW & ADVOCACY

  • Big tech has notoriously been a complex industry and now Senate is looking to pass a bill to protect the smaller guys in the industry. The American Innovation and Choice Online Act will prohibit tech firms from making their own products the top search results and misusing sellers’ data to make their own products more competitive. As this bill has bipartisan support and 61% of U.S. consumers believing that the U.S. government should intervene when tech companies gain too much control of the economy (up from 56% in 2019), it will likely pass and, subsequently, impact many mega brands such as Amazon, Apple, and Google. Smaller brands that have long lost out on business due to Big Tech’s strategies will have a chance to thrive if this bill is passed. At this time, small retail businesses should begin building brand awareness in this time prior to the bill passing. Source: eMarketer, October 2021
  • U.S. individuals are charitable people, however many value convenience in their life more. In 2020, individuals and corporations donated more than $471 billion to charities, but far more individuals in the U.S. would be willing to donate and donate larger amounts if there was a trusted and easier method to do so, which is why Givelify, the leading giving app, was created. While many charitable foundations have online giving options, they are not as widely used due to the long process and excess information needed from donors. Givelify and other giving apps have solved this problem. To maximize donations, nonprofits and charitable foundations must incorporate easy and quick digital giving technology. As the holiday season approaches and consumers are in an even more giving mood, it is important that charitable foundations and nonprofits promote their easy digital donation offering. Source: Forbes/Giving USA Foundation, October 2021

INTERNET & TELECOM

  • Black adults living in rural communities have far less internet access than any other group. It has long been known that the digital divide hits hard in rural communities, but demographic analysis was not widely produced. In a study conducted by the Joint Center for Political and Economic Studies, it was revealed that Black U.S. adults living in rural communities in the South were nearly twice as likely as White individuals in the same markets to have no home internet access. While only 4% of the total U.S. population lacks access to high-speed broadband, more than 25% of rural Black individuals are without, further continuing the cycle of racial disparities in the U.S. While the Biden administration has promised broadband expansion to rural communities, it will take additional investment from telecom companies to provide equal access to those lacking. In a world where many individuals care more about brand ethics than product offering, telecom companies can set themselves apart and gain more users by promoting their donations made and steps taken to provide internet access to those without. Source: eMarketer/Joint Center for Political and Economic Studies, October 2021
  • T-Mobile is making headlines for cutting the cost of their home 5G Internet by 17% to bring the total to $50/month. While only 30 million U.S. households have access to 5G home internet service, it is a competitive market. Verizon currently offers the same service for a high cost of $70/month. As T-Mobile attempts to keep current customers and acquire new customers, a bold incentive had to be offered, which came in the form of a 17% price decrease. T-Mobile is now setting standards in the industry that competitors like Verizon and AT&T will have to match. We expect other 5G competitors to cut their prices and increase incentives to avoid losing customers to T-Mobile. This price war will soon be a major theme of media among these brands. Source: eMarketer, October 2021