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Sep 01, 2004

Housewares Report: A 25-Year Look Back and a 25-Year Look Ahead

PrintHousewares Report: A 25-Year Look Back and a 25-Year Look Ahead  

By Jack Eikenberg
"Jack," cooed my ever-tolerant, persevering wordsmith editor Michelle Moran back in June, "2004 is our 25th anniversary, and we're celebrating it in the September issue. Why don't you take a look at the past 25 years, maybe backwards and forwards, and that time spread of 50 years. It will be the best piece in the book!"
"Sure," said I without much thought. After all, I just went through half of that period, many of the scars still remain, and I hope to experience some of the remaining half yet to come. Then I got to thinking, "A lot has happened since 1979, including me getting 25 years older. What was that assignment again?"
Hmm, let's see . . . 1979. Gosh, those were the waning days of Jimmy Carter's administration and our countrymen were being held hostage by Muslim fanatics in Iran. Failure to free Americans helped cause the downfall of the Carter government and provided ummph to the coming Reagan revolution.
Now, 25 years later, we are still held kind of hostage by similar Islamic factions, only this time, it is Iraqi and Arab terrorists. Somehow, the pursuit of democracy isn't an activity that seems to resonate loudly in the Middle East.
Things don't seem to change much in that unfortunate part of the world, but they sure have changed in the domestic housewares world!

1979 and the Past 25 Years
When social anthropologists begin examining changes, they usually focus on root causes for the changes and the so-called 'drivers' of those changes. What were our drivers? What just evolved?
What was 1979 like? We had computers, but they were big, bulky, heavy, and not portable. Usage was tied into the mainframe and dependent upon the central system. Al Gore had not yet invented the Internet and e-mail was someone's dream. Faxes were operable, but turned brown and curled up. Surely, you could not transmit orders or anything important on a facsimile machine. Americans were still at the mercy of the U.S. mail, as exemplified by those in the big Chicago post office who could hardly read. The founders of some Memphis outfit named FedEx were still polishing term papers.
Department stores were very important and told you so continually. Best and Service catalog showrooms flexed their muscles at every instance. Sears, Wards, and Penney's dominated middle-class sales, as did K-Mart. Wal-Mart was still in its infancy and Target was not yet the profitable and dominate part of Dayton-Hudson.
As the Reagan tax cuts started working in 1981, the economy took baby steps toward a new life, and then giant steps. Interest rates fell from 22 percent to four or five percent and Americans started reinvesting. The oldest Baby Boomer was 35 and working to feed both family and wants. Life in America would eventually never be the same. Lower borrowing rates and more per-pocket spendable income combined with easier credit and good jobs blew the lid off of the economy. Credit card debt became a concern and people accumulated "stuff" at warp speed.
One deterrent to the acquisition of "stuff" was that most retailers were always out of stock on the most popular items. Wal-Mart solved this by investing more in their back-room operations than in buildings and salaries and revolutionized retailing. Imagine serving the customer first? No longer did impulse shoppers have to wait, and pay extra for the privilege of waiting.
Wal-Mart worked on less and had ready supplies. Might they be successful? Nah! Too unsophisticated. They did not speak Joisey or Noo Yahk English, and seldom screamed and shouted. Strange ducks those Arkansans.

The National Impact
Well, so started the age of the consumer and superior service as a differentiating business strategy at the expense of overhead, margin, and elitist exclusivity of distribution. That major quake, in turn, created other powerful galactic shifts that would force and create hundreds of mergers and buyouts in the name of being more competitive in size, scope, and geography. Lots of economic pressures came to bear and many famous retailer names and vendor brands bit the dust by 1990, a process which is still in play.
Are we better served that GE no longer makes and sells small appliances but instead licenses their good name to someone we don't know? Is America well served because nearly all of the domestic cookware and small appliance business is either owned or produced by foreign firms? Are we better off that so many products are now licensed and brands stand for little except design, marketing, and purchasing systems?
Have we improved our lot now that Wal-Mart, Target, Home Depot, and Lowe's dominate instead of K-Mart, Macy's, and Tru-Value?
Have we gained now that trade shows and their supporting casts are merely stressful remembrances of the past, and so much can now be done at home and by computer?
We all still eat, although less and less at home. Most of us live in homes with kitchens that still function and reheat take-out well. We also have outside areas that need repair and sprucing up. Many of us live in condos. Away go the rakes, shovels, ladders, fireplace tools, hoses, and lawnmowers -- all the things you need to care for your home. My home is now in the sky and someone else does that kind of work. We just pay.

Today in 2004
The older Baby Boomers are now a grandfatherly 58, as is President Bush. The youngest Boomer is now 40. Wife Joyce and I have a daughter who was born in 1964. Golf is back, tennis is getting hard on the old knees, jogging is waning, and who has time to regularly work out, or just sit and read or laze? Staying home isn't so bad anymore, especially after a long day at work.
Might this trend trigger a home-development boom? Yes, I believe so, but not in cooking. Take-out vendors can serve tastefully and cheaply. Think home entertainment -- DVDs, videos, plasma TVs, interactive cable, and downloading. Boomers still schedule themselves to distraction rather than letting things just happen as previous generations did. So, most Personal Organizing Tools (POT) still bring happiness and purchases. Personal shoppers are also on the rise to save time and direct more deliberate impulse buying.
With real concern over obesity and being overweight, coupled with advancing age and aches and pains, clear focus is on nonfattening food and drink and eating to prevent specific health problems.

The Future
Since I claim no clue as to what the future holds, here are some evolving concepts unencumbered by fact or reality for your bemusement.
Broccoli will soon be discovered to help heal your recovery from liposuction and 10 stalks per day may be the minimal Agriculture Department daily recommended ration. The fact that Hillary's new Secretary of Agriculture owns a 10,000-acre broccoli farm is a mere coincidence.
A new beer formula actually helps drinkers lose weight with an inventive Pac-man breed of hops and malt barley that eats calories for you, and therefore, you lose pounds. One skeptical frat brother actually drank a keg of this brew by himself and lost 40 pounds. Immediately, he was sent to the McDonald's infirmary, and intravenously fed a diet of shakes and fries until he could resume normal activities.
That odd-shaped room where many of us spent happy hours licking pots and watching Mom bake cookies has been reassigned scheduling, the receiving of inbound foodstuffs, and reheating duties. Wal-Mart has just bought up all of the domestic pizza and burger firms and now delivers goods to every home via the largest fleet of potato-powered vehicles within 15 minutes of voice computer call-in. The new joint venture between Wal-Mart and Ford called Pomme Frites just closed at $700 per share.
Third-generation Walton heirs advise the stock market that if Mr. Sam could provide shopping customers in-stock goods all of the time, they too can provide nonshopping customers with their meals without ever being out of stock. The creative potato fuel heats the GPS-directed oven/delivery car as it consumes the potato, keeping your meal contents nice and warm. The Walton family just bought Montana from Ted Turner to better control their own potato production and in turn, ceded Little Rock to Turner, the home of another hot potato of sorts.
Cold drinks have presented scientists with a stickier problem as brussels sprouts consumption seems to clog the energizer unit of the freezer/delivery car. I'm told that secret experiments on collard greens are underway, but cannot reveal details.
When visiting a museum oddity of the past, something called an "eat-in restaurant," one computer question popped up asking, "How do you like your steak -- medium or medium rare?" Ever-alert little G.W. responded, "Mom, they forgot proteinized and decholesterolized!"
Starbucks just completed their 700,000-mile pipeline, bringing their coffee into every home in the land. The water companies now rent space from Starbucks and furnish homes with water at off-peak coffee consumption times that now have about a 21-hour span. Trying to take a shower in vanilla decaf latte has its drawbacks. The higher-octane versions defoliate better.

Serious Stuff
It is fun to create silly thoughts, but my demented musings do little to guide your business. Here is your focus for the next 10 years. Baby Boomers will be morphing into seniors and needing all the things current seniors need and want, but three times as much and wanting it "now," not next week.
The Baby Boomer generation drove the 50's with youth products. The 60's and 70's were dominated by teenage and young adult needs and the 80's and 90's by adult- and family-oriented demands. Now, at 58 and aging, they will still drive markets, but with older-people needs -- more digestible foods, easier transportation, less work-related products and services, easier-to-care-for clothing and gadgets, and many more prepared and ready-to-eat foods. This is before we start including doctors, prescription drugs, and health care requirements and maintenances.
Health care will become the number-one government, political, and consumer marketing issue of the coming 25 years. Sure, we will enjoy computer-managed homes, cars that seldom need repair, uninterrupted family intercommunications, varieties of home services that we once expected to do ourselves, and lots of make-life-easier inventions and innovations, but health care needs and wants will dominate. The kitchen, like much of the Industrial Revolution and its products and lifestyles, will not.

Jack Eikenberg enjoys occasional release from his padded, assisted-living home and somehow manages to provide advice and counsel to houseware and specialty market clients. Jack may still be reached without medication at 239-498-0040 and by e-mail at JMEmgmt@aol.com.







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