1.STATUS SPHERES

Let's start this December Trend Briefing by looking back. At the beginning of 2007, as part of our STATUS LIFESTYLES trend, we wrote:

"Here's something trend watchers, CMOs and other business professionals should be able to agree on: in the end, when dealing with (and selling to) people, everything always comes back to status. In a traditional consumer society, he or she who consumes the most, the best, the coolest, the most expensive, the scarcest or the most popular goods, will typically also gain the most status."

Now, you guessed it: the above will still ring true in 2008, and should be on your mind whenever/wherever in the new year—when tracking trends, when mapping out new strategies and when coming up with new products and services for your customers. In fact, expect 2008 to be the year in which even more brands realize (if not grudgingly accept) that 'old', mass-era status symbols, from the Audi R8 to the De Beers Talisman Watch Collection are no longer every consumer's wet dream. After all, as mature consumer societies are increasingly dominated by (physical) abundance, by saturation, by experiences, by virtual worlds, by individualism, by participation, by feelings of guilt and concern about the side effects of unbridled consumption, status is to be had in many more ways than leading a lifestyle centered on hoarding as many branded, luxury goods as possible.

We've dubbed the above phenomenon STATUS SPHERES: a variety of lifestyles, activities and persuasions, which can be mixed and matched by consumers looking for recognition from various crowds and scenes. Getting too vague? Here are some STATUS SPHERES to keep an eye out for in 2008:

Traditional consumption is about buying more and/or better stuff than fellow consumers. Which is by no means dead. In fact, expect the consumer arena in 2008 to still be about hundreds of millions of consumers who do want to consume more, who do covet all things bling, who do crave in-your-face brands. Oh, and even if (a big if*) conspicuous consumption were ever to subside in mature consumer societies, then count on the emerging middle classes in China,** India, Russia, South Africa, Turkey, Nigeria, Vietnam, Indonesia, Mexico and Brazil to proudly take over the torch. In other words, count on multiple consumption and status arenas to develop simultaneously for years to come.

However, while the rise of the global middle class is as big a story as they come, the rise of high net worth individuals (HNWIs) has an equally significant impact on consumerism. Consider the following numbers, from the 2007 World Wealth Report by Merrill Lynch and Capgemini:

• The number of HNWIs—individuals with net assets of at least USD 1 million, excluding their primary residence and consumables—in the world increased 8.3% to 9.5 million.
• The number of ultra-HNWIs—individuals with net assets of at least USD 30 million, excluding their primary residence and consumables—grew by 11.3% to 94,970.
• The BRIC nations (Brazil, Russia, India and China) continue to play increasingly important roles in the global economy. China and Russia were among the top ten countries with the fastest growing HNWI populations. China’s HNWI population grew by 7.8% to 345,000 people and Russia’s has increased by 15.5% to 119,000. Brazil (120,000 HNWIs) and India (100,000 HNWIs) also showed continued strength.

With so much (new) wealth and disposable income around the world, not only is there money to be made from selling premium goods, there’s also a constant need for redefining what constitutes luxury, for what constitutes status in bling-driven consumer societies. If millions have access to the same premium goods, to the same premium brands, these premium offerings lose some of their value, as their entire raison d’être was to offer something that others could not get access to. Scarcity is becoming less scarce and wealth is always relative, leading to actual STATUS DESPAIR among those who are by all means, financially well off.

So in an arena that has become crowded with middle class and high net worth consumers, expect luxury goods to take on more outlandish forms and shapes, at ever-higher costs. Our most recent favorite example of STATUS DESPAIR was Prince Alwaleed bin Talal bin Abdulaziz Al-Saud of Saudi Arabia buying himself a USD 320 million Airbus 380, which for another USD 100+ million will be turned into a 'flying palace' with three bedrooms, private lounges, bathrooms, offices, a steam bath and exercise machines. But even here, commoditization is threatening the Prince's purchase: Airbus actually expects to sell about 20 VIP versions of the A380.

* As we’ve pointed out many times before, one mistake both trend watchers and brands make all the time, is to assume or pretend that a certain ‘trend’ will affect or be embraced by ALL consumers. No. Remember, in life and in trends: beauty (or ugliness) is in the eye of the beholder.

** The Chinese middle class consists of those people who have a degree of economic independence, but not a great deal of social influence or power. The term often encompasses merchants and professionals, bureaucrats, and some farmers and skilled workers. Definition of middle class in China: managers, professionals, skilled technicians and service workers earning USD 2,500 to USD 10,000 a year each. It is expected to grow from 100 million people in 2005 to 200 million people by 2010, reaching 315 million by 2015. (Source: Insight Bureau.)

Luckily, before we reach total STATUS DESPAIR, there's still plenty of room for innovation in the traditional sphere: check PREMIUMIZATION (trend # 2) below.

Attractive to consumers who are driven by experiences instead of the fixed—those who are driven by entertainment, by discovery, by fighting boredom, who increasingly live a transient lifestyle, freeing themselves from the hassles of permanent ownership and possessions.

We dubbed these consumers TRANSUMERS about a year ago, and the trend is still building. Implications for 2008? An obsession with the here and now, an ever-shorter satisfaction span, and a lust to collect as many experiences and stories as possible, is undermining the perceived value (and thus status) of fixed goods and services. More practical examples in SNACK CULTURE (trend # 3) below.

Where to begin? In an online world or virtual world, social status 2.0 is all about who you connect to and who wants to connect to you, tribal-style. It also encompasses status gained from the number of views for one's photos on Flickr, to the number of friends on Facebook, to one's gaming skills and levels (just a snippet: Microsoft's Halo 3 racked up USD 170 million in sales on its first day of availability, making it the hottest-selling title in video game history. Total sales since September 2007: 4+ million copies) to the good looks of one's avatar, to finding out about whatever/wherever on anything before anyone else does. More on this in ONLINE OXYGEN (trend # 4) below.

With the environment finally on the agenda of most powers that be, and millions of consumers now actively trying to greenify their lives, status in the eco-sphere is both more readily available, and increasing in value. A substantial subset of consumers is already bestowing recognition and praise on Prius drivers while scorning SUV owners, and this will only accelerate as even more design-minded and branding-savvy eco-firms push to the forefront in 2008. Make it green, make it effortless, make it visible if not bold if not iconic, and don't hesitate to point out your competitor's polluting alternatives ;-) For more on this, see ECO-ICONIC (trend #5) below.

Find us one high-profile billionaire who's not deeply into 'giving' right now. In fact, whether it's giving away your riches, your time, or sharing your (content) creations with total strangers, giving is the new taking. For an excellent overview of the world's most generous philanthropists (trendsetters par excellence!), check out BusinessWeek's recent special on the topic. For brand implications, see BRAND BUTLERS (trend #6) below.

Especially for younger (and younger-at-heart) consumers, participation is the new consumption. For these creative beings, status comes from finding an appreciative audience, which is much the same way brands operate. No wonder that it's becoming increasingly important to hone one's creative skills. Status symbols, make way for STATUS SKILLS? What's going to be your participation strategy for 2008? See also trends #7 and 8 in this briefing: MIY | MAKE IT YOURSELF and CROWD MINING.

One thing you can't go wrong with in 2008 is to ask yourself how your current and new products and experiences will satisfy an audience of very diverse status seekers. If you haven't done so already, get rid of the habit of only focusing on traditional status symbols, and you will find there is no end to the number of STATUS SPHERES you'll be able to identify.