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The Female Economy
As a market, women represent an opportunity bigger than China and India combined. They control $20 trillion in consumer spending, and that figure could reach $28 trillion in the next five years. Women drive the world economy, in fact. Yet most companies do a remarkably poor job of serving them, a new study by the Boston Consulting Group reveals. BCG surveyed more than 12,000 women from a variety of geographies, income levels, and walks of life about their education, finances, homes, jobs, activities, interests, relationships, hopes, and fears, as well as their shopping behaviors and spending patterns. In this article, Silverstein and Sayre, two of the firm's partners, review highlights of the findings and explain the biggest opportunities. While any business would be wise to target female consumers, they say, the greatest potential lies in six industries: food, fitness, beauty, apparel, health care, and financial services. Address women's concerns effectively, and your company could see the kind of rapid growth that fitness chain Curves enjoyed. Most health clubs are expensive and designed for men, with lots of complicated body-building equipment. Curves, however, understood that time-pressed women needed quick, affordable workouts, and came up with the concept of simple, 30-minute exercise routines geared to women and offered in no-frills spaces. Companies that likewise successfully tailor their offerings to women will be positioned to win when the economy begins to recover. -
Luxury for the Masses
There is a new class of American consumer and a new category of products and services has sprung into being to cater to it: new luxury. America's middle-market consumers are trading up to higher levels of quality and taste than ever before. Members of the middle market (those earning $50,000 and above annually) collectively have around $3.5 trillion of disposable income. And they will pay premiums of 20% to 200% for well-designed, well-engineered, and well-crafted goods that can't be found in the mass middle market and that have the artisanal touches of traditional luxury items. Supply-side forces are essential to the rise of new luxury. Like the consumers of their goods, entrepreneurs are better educated and more sophisticated about their customers than ever before. In addition, global sourcing, falling trade barriers and transportation costs, and rising offshore manufacturing standards are making possible the economical production of alluring products of high quality. Unlike old-luxury goods, new-luxury products can generate high volumes despite their relatively high prices. As a result, companies at the new-luxury forefront are achieving levels of profitability and growth beyond the reach of their conventional competitors.