The Trend is Your Friend

Every year, as we compile data for our Trends Report (published in our January issue, there are a few nerve-racking moments when we worry that there might have been some glitch in our survey process. Yes, we try to pose new questions that will prove thought-provoking, but unexplainable trends are cause for concern. In short, although we like surprises, we hate surprises.In November, the crunching began and sure enough, the answer to one question started trending in a way we found curious. Only one in every four of our survey respondents said they'd bothered to investigate radio frequency identification (RFID) technology. Only a mere 8.8% said they'd begun testing it. Remembering that we were already a couple of years into Wal-Mart's mandate to suppliers that they comply with its RFID initiative deadline January 2005 we were concerned that our data seemed to show an awful lot of foot-dragging out there; much more than we thought Wal-Mart would tolerate.Well, although we never take pleasure in bad news, we must confess a bit of relief when stories confirming our survey results began appearing during the holidays. "The progress has been much slower than many people anticipated, and in some cases it's stalled," said the New York Times, noting that most participants "were cooperating with Wal-Mart out of fear of offending the retailer and were, as much as possible, putting off investments in the technology." Some companies, it added, had delayed for so long that they now had trouble getting tags so that they could get started.Other survey questions conformed more immediately to observable market indications. Late last fall, for example, Paul Pinkus, the national director of the In-Store Marketing and Store Design Group at American Express Tax and Business Services, stumbled onto a leading economic indicator while running a meeting of P-O-P company owners. After surveying everyone in the room for their biggest business concerns and tallying the results, he noticed that the top vote-getter by far was "finding and retaining good employees."Pinkus said that while this was an oft-cited concern for P-O-P companies during the 1990s, it hadn't been mentioned much at all from 2000 to 2004, years of economic slowdown. Its sudden re-appearance at this meeting and at the top of the list was good news indeed.Our survey confirmed his intuition: Nearly one-third (31%) of CPG marketer respondents said they had seen growth in their P-O-P budgets, while more than half (59%) said they had remained constant. Few reported budget cuts. For 2005, 40.2% predicted an increase in their P-O-P budgets, while 51.7% predicted no change. Again, only a handful saw cuts. One of my favorite manufacturing maxims is "We can make it fast, cheap and correctly. So which two do you want?" This year, we turned that aphorism into a survey question for marketers. When asked to choose the two most important factors in working with P-O-P producers, more survey respondents chose quality of display (71.9%) than lowest possible costs (55.5%) or fast-track development (47.7%). Delving deeper into the data (not shown in our report), I noticed that the marketers who do most of their business through the mass merchant channel considered "lowest cost" to be the most important. On the other hand, marketers who focus on the supermarket channel ranked "quality" very high while downplaying speed to market.

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