Posts Tagged 'Generations'



A Math Myth?

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I just finished reading The Math Myth: And Other STEM Delusions by Andrew Hacker. I found the book to be so provocative and interesting that it merits the first ever book review on this blog.

The central thesis of the book is that in the US, we (meaning policy makers, educators, parents, and employers) have become obsessed with raising rigor and academic standards in math. This obsession has reached a point where we are convinced that our national security, international business competitiveness, and hegemony as an economic power rides on improving the math skills of all our high school and college graduates.

Hacker questions this national fixation. First, raising math standards has some serious costs. Not only has it caused significant disruption within schools and among educators and parents (ask any educator about the upheaval the Common Core has caused), but it has also cost significant money. But, most importantly, Hacker makes a strong case that raising of math standards has ensured that many students will be left behind and unprepared for the future.

Currently, about one in four high school students does not complete high school. Once enrolled in college, only a bit more than half of enrollees will graduate. While there are many reasons for these failures, Hacker points out that the chief ACADEMIC reason is math.

I think everyone can think of someone who struggled mightily in math. I personally took Calculus in high school and two further courses in college. I have often wondered why. It seemed to be more of a rite of passage than an academic pursuit with any realistic end in mind for me. It was certainly painful.

Math has humbled many a bright young person. I have a niece who was an outstanding high school student (an honors student, took multiple AP courses, etc.). She went to a reputable four-year college. In her first year at college, she failed a required math course in Calculus. This remains the only course she had gotten below a B in during her entire academic life. Her college-mandated math experience made her feel like a failure and reconsider whether she belonged in college. Fortunately for her she had good supports in place and succeeded in her second go round at the course. Many others are not so lucky.

And to what end? My niece has ended up in a quantitative field and is succeeding nicely. Yet, I doubt she has ever had to calculate the area under a curve, run a derivative, or understand a differential equation.

The reality is very few people do. Hacker, using Bureau of Labor Statistics data, estimates that about 5% of the US workforce currently uses math beyond basic arithmetic in their jobs. This means that only about 1 in 20 of our students will need to know basic algebra or beyond in their employment. 95% will do just fine with the math that most people master by the end of 8th grade.

And, despite the focus on STEM education, Hacker uses BLS data to show that the number of engineering jobs in the US is projected to grow at a slower rate than the economy as a whole. In addition, despite claims by policy makers that there is a dearth of qualified engineers, real wages for engineers have been falling and not rising, implying that supply is exceeding demand.

Yet, our high school standards and college entry standards require a mastery of not just algebra, but also geometry and trigonometry.

Most two-year colleges have a math test that all incoming students must pass – regardless of the program of study they intend to follow. As anyone who has worked with community colleges can attest to, remediation of math skills for incoming students is a major issue two-year institutions face. Hacker questions this. Why, for example, should a student intending to study cosmetology need to master algebra? When is the last time your haircutter needed to understand how to factor a polynomial?

The problem lies in what the requirement that all students master advanced math skills does to people’s lives unnecessarily. Many aspiring cosmetologists won’t pass this test and won’t end up enrolling in the program and will have to find new careers because they cannot get licensed. What interest does this serve?

Market research is a quantitative field. Perhaps not as much as engineering and sciences, but our field is focused on numbers and statistics and making sense of them. However, in about 30 years of working with researchers and hiring them, I can tell you that I have not once encountered a single researcher who doesn’t have the technical math background necessary to succeed. In fact, I’d say that most of the researchers I’ve known have mastered the math necessary for our field by the time they entered high school.

However, I have encountered many researchers who do not have the interpretive skills needed to draw insights from the data sets we gather. And, I’d say that MOST of the researchers I have encountered cannot write well and cannot communicate findings effectively to their clients.

Hacker calls these skills “numeracy” and advocates strongly for them. Numeracy skills are what the vast majority of our graduates truly need to master.  These are practical numerical skills, beyond the life skills that we are often concerned about (e.g. understanding the impact of debt, how compound interest works, how to establish a family budget).  Numeracy (which requires basic arithmetic skills) is making sense of the world by using numbers, and being able to critically understand the increasing amount of numerical data that we are exposed to.

Again, I have worked with researchers who have advanced skills in Calculus and multivariate statistical methods, yet have few skills in numeracy. Can you look at some basic cross-tabs and tell a story? Can you be presented with a marketing situation and think of how we can use research to gather data to make a decision more informed? These skills, rather than advanced mathematical or statistical skills, are what are truly valued in our field. If you are in our field for long, you’ll noticed that the true stars of the field (and the people being paid the most) are rarely the math and statistical jedis – they tend to be the people who have mastered both numeracy and communication.

This isn’t the first time our country has become obsessed with STEM achievement. I can think of three phases in the past century where we’ve become similarly single-minded about education. The first was the launch of Sputnik in 1957.This caused a near panic in the US that we were falling behind the Soviets and our educational system changed significantly as a result. The second was the release of the Coleman Report in 1966.This report criticized the way schools are funded and, based on a massive study, concluded that spending additional money on education did not necessarily create greater achievement. It once again produced a near-panic that our schools were not keeping up, and many educational reforms were made. The third “shock” came in the form of A Nation at Risk, which was published during the Gen X era in 1983. This governmental report basically stated that our nation’s schools were failing. Panicked policy makers responded with reforms, perhaps the most important being that the federal government started taking on an activist role in education. We now have the “Common Core Era” – which, if you take a long view, can be seen as history repeating itself.

Throughout all of these shocks, the American economy thrived. While other economies have become more competitive, for some reason we have come to believe that if we can just get more graduates that understand differential equations, we’ll somehow be able to embark on a second American century.

Many of the criticisms Hacker levies towards math have parallels in other subjects. Yes, I am in a highly quantitative field and I haven’t had to know what a quadratic equation is since I was 16 years old. But, I also haven’t had to conjugate French verbs, analyze Shakespearean sonnets, write poetry, or know what Shay’s Rebellion was all about. We study many things that don’t end up being directly applicable to our careers or day-to-day lives. That is part of becoming a well-rounded person and an intelligent citizen. There is nothing wrong with learning for the sake of learning.

However, there are differences in math. Failure to progress sufficiently in math prevents movement forward in our academic system – and prevents pursuit of formal education in fields that don’t require these skills. We don’t stop people from becoming welders, hair-cutters, or auto mechanics because they can’t grasp the nuances of literature, speak a foreign language, or have knowledge of US History. But, if they don’t know algebra, we don’t let them enroll in these programs.

This is in no way a criticism of the need to encourage capable students from studying advanced math. As we can all attest to whenever we drive over a bridge, drive a car, use social media, or receive medical treatment, having incredible engineers is essential to the quality of our life. We should all want the 5% of the workforce that needs advanced math skills to be as well trained as possible.Our future world depends on them. Fortunately, the academic world is set up for them and rewards them.

But, we do have to think of alternative educational paths for the significant number of young people who will, at some point, find math to be a stumbling block to their future.

I highly recommend reading this book. Even if you do not agree with its premise or conclusions, it is a good example of how we need to think critically about our public policy declarations and the unintended consequences they can cause.

If you don’t have the time or inclination to read the entire book, Hacker wrote an editorial for the NY Times that eventually spawned the book. It is linked below.

Is Algebra Necessary?

 

Asking about gender and sexual orientation on surveys

When composing questionnaires, there are times when the simplest of questions have to adjust to fit the times. Questions we draft become catalysts for larger discussions. That has been the case with what was once the most basic of all questions – asking a respondent for their gender.

This is probably the most commonly asked question in the history of survey research. And it seems basic – we typically just ask:

  • Are you… male or female?

Or, if we are working with younger respondents, we ask:

  • Are you … a boy or a girl?

The question is almost never refused and I’ve never seen any research to suggest this is anything other than a highly reliable measure.

Simple, right?

But, we are in the midst of an important shift in the social norms towards alternative gender classifications. Traditionally, meaning up until a couple of years ago, if we wanted to classify homosexual respondents we wouldn’t come right out and ask the question, for fear that it would be refused or be found to be an offensive question for many respondents. Instead, we would tend to ask respondents to check off a list of causes that they support. If they chose “gay rights”, we would then go ahead and ask if they were gay or straight. Perhaps this was too politically correct, but it was an effective way to classify respondents in a way that wasn’t likely to offend.

We no longer ask it that way. We still ask if the respondent is male or female, but we follow up to ask if they are heterosexual, lesbian, gay, bisexual, transgender, etc.

We recently completed a study among 4-year college students where we posed this question.  Results were as follows:

  • Heterosexual = 81%
  • Bisexual = 8%
  • Lesbian = 3%
  • Gay = 2%
  • Transgender = 1%
  • Other = 2%
  • Refused to answer = 3%

First, it should be noted that 3% refused to answer is less than the 4% that refused to answer the race/ethnicity question on the same survey.  Conclusion:  asking today’s college students about sexual orientation is less sensitive than asking them about their race/ethnicity.

Second, it is more important than ever to ask this question. These data show that about 1 in 5 college students identify as NOT being heterosexual. Researchers need to start viewing these students as a segment, just as we do age or race. This is the reality of the Millennial market:  they are more likely to self-identify as not being heterosexual and more likely to be accepting of alternative lifestyles. Failure to understand this group results in a failure to truly understand the generation.

We have had three different clients ask us if we should start asking this question younger – to high school or middle school students. For now, we are advising against it unless the study has clear objectives that point to a need. Our reasoning for this is not that we feel the kids will find the question to be offensive, but that their parents and educators (whom we are often reliant on to be able to survey minors) might. We think that will change over time as well.

So, perhaps nothing is as simple as it seems.

“I wish that I could be like the cool kids”

In today’s digital environment, marketers are often seeking a viral way to spread news about their product or to stoke a trend. Traditional thinking was that trends spread predictably. Trends were seen to launch on the west coast (usually from urban environments), spread to the east coast, and eventually make their way to middle America and a mass market. This is why so many “cool seeker” or “trend seeker” researcher panels were established. By connecting to the cool kids in the right environments, marketers could get an early sense of what was going to happen next and get on board for the ride. They could seed ideas with the right audience and let nature take its course.

The Internet has largely blown up this paradigm. It has become a great “leveler” of youth trends. Now, a trend can start anywhere, become viral seemingly randomly, and spin out of control quickly. A geographic center of trends is hard to pinpoint if it exists at all. In research, “trend seeker” panels have become more of an oddity in market research – and have been supplanted largely by online communities of teens from across the country.

How can a communications and “connecting” technology (the Internet) have such a profound impact on how innovations and trends take hold?

Innovation diffusion to the mainstream has been the subject of academic study for some time.  Perhaps the most seminal work in the field came in 1962 when Everett Rogers published The Diffusion of Innovations. This book has been required reading at MBA marketing programs for more than 50 years.

In this book, Rogers outlines a classic theory. Innovators (2-3% of the population) start using a product. Early adopters (10%-15%) see what the innovators are doing and jump on board quickly. Next, the early majority (30%-35%) jumps on board as the hype around the product peaks. The late majority (30%-34%) gets on board. Finally, eventually the laggards (10%-15%) join in.

For decades, this thinking caused marketers to focus a disproportionate effort on the innovators – the 2%-3% of the population that supposedly spark new trends. This concept is the underpinning of why marketing dollars flow towards young people, urban consumers, minorities, etc. as marketers hope to start a chain reaction through the Rogers segments. Why have we had such a focus on youth marketing? It isn’t because they have a lot of money to spend, as compared to other age segments they don’t.  It is because marketers feel they are influential.

New media and viral marketing has made this thinking even more prevalent. If we can just reach the influencers, we’ll let loose a viral effect and sell a lot of product. Unfortunately, this thinking is a good example of applying an old paradigm to a new world.

Even in the pre-Internet past, this thinking tended to work more on a “fad” than a “trend” level. To illustrate this, in presentations I often ask the audience to write down what they think the most successful marketing brands and products have been in the past 10 years that are youth-oriented. I pause, and then list them out on a whiteboard. Typical responses are as follows:

  • The iPhone
  • Harry Potter franchise
  • American Idol
  • Barbie
  • National Football League
  • Various Boy Bands

I then point out that franchises like these, which have hit it incredibly big with youth, all have one thing in common. They didn’t diffuse to the mainstream in the Rogers fashion. They didn’t start by being popular with cool kids. Rather, they found a way to go directly to the mainstream. Oftentimes, they got there by being shunned by the cool kids.

I believe the rise of the Internet will eventually (once they catch on) cause marketers to stop thinking in the traditional way about how new trends diffuse to the mainstream. The introverted kid in the Midwest who has a popular blog is fast becoming more influential than the hipster on the street in Los Angeles. Marketers will find more direct tributaries to the mainstream, and the cool hunter research panels that still exist in the market research industry will disappear.

How the truth campaign plans to end youth smoking once and for all

Excellent article on a great client!

http://www.fastcocreate.com/3049629/behind-the-brand/how-the-truth-campaign-plans-to-end-youth-smoking-once-and-for-all

Millennials as Entrepreneurs?

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A few years back, I followed a symposium speaker who described how today’s youth generation (Millennials) were likely to be highly entrepreneurial. Her reasoning seemed to be that big ideas and companies tend to be launched by young trendy people willing to take risks, that experiences such as the founding of Facebook show how far technology can take a young person with big ideas, and that there are so many Millennials that big things were about to happen.

I disagree. Here is a prognostication to file and look at in about 20 years: when all is said and done, history will judge Millennials as one of the LEAST entrepreneurial of the recent generations.

Why? There are some key characteristics of Millennials that lead strongly to this conclusion.

  1. Millennials are risk-averse. If you look at long term trends on almost any risk behavior, you will see that Millennials are on the good side of history.  Drug, alcohol, and tobacco use has plummeted, crimes committed by young people have declined, teen pregnancy rates are at their lowest in decades, and college attendance is at an all-time high.
  2. Millennials have grown up in a world of structure and protection. This is a “comfortable” generation that largely hasn’t felt a need to act out or to fend for themselves as children.  Just a generation ago Gen Xers were known as lightly-parented, latch-key kids, who as a consequence had to learn to find their own creative solutions to problems they encountered.  Millennials have not had to develop these types of skills. In fact, many Millennials expect to move back in with their parents for a time post-college, and much of this boomerang mentality is from a desire to return to their parents, not just out of economic necessity.
  3. As Millennials have come of age, the education system has evolved in a narrow way, with an almost exclusive focus and reward structure around STEM fields. Many would say that creativity has become collateral damage along the way. This develops college graduates with incredible technical skills, but boxes them in creatively.
  4. Today’s employers are focusing more than ever on the care and feeding of their Millennial employees. They no longer hire gobs of college graduates and let them fight their way to the top.  Rather, they have instituted career advancement and mentorship programs and seem much more willing to invest in the development of their young employees.
  5. Finally, Millennials seek structure and security in employment. Each year Universum conducts a college student survey which asks pending college graduates whom their ideal employer is. Just as the Millennial generation started graduating college, larger organizations, former startups that had become huge companies, and even governmental agencies started taking over the top 10. Would you believe that the #3 most desirable employer among humanities graduates is currently the US Department of State? Or that #4 is the United Nations? Or that #6 is the FBI? Incredibly, even the NSA makes the top 10.

Millennials seem perfectly formed for larger organizations that take the time truly understand them. They will desire the structure and caring these organizations can provide as it parallels the structure and caring that has surrounded them their whole lives.  They will of course want to be able to express their ideas and find creative solutions to problems.  What we are now seeing in large organizations is a willingness to allow them to do so.

This is not to say that in 20 years we won’t look back and see some incredible firms that were started by Millennials, as we certainly will. But, compared to their Gen X predecessors, I’ll be very surprised if this generation is characterized as entrepreneurial in a historical sense.

The Evolution of Youth Marketing

Youth marketing is sometimes described as an “industry.” It has its own consultants, specialized agencies, and researchers. In my own lifetime I’ve seen marketing to kids move from something to be feared to something that is expected.

It can be somewhat disturbing to attend youth marketing conferences and hear militaristic terms used to describe children. Youth have become “targets,” a segment to be “captured,” and a demographic to be “penetrated.” I’ll never forget being at a youth conference where a presenter came dressed in full camouflaged military regalia and carried a fake shotgun. His theme was that if you want to capture the youth market, it is necessary to “hunt” them in their native habitat. More disturbing than the talk was the 200 or so youth marketers in the audience that didn’t seem disturbed by his characterization of children.

It is interesting to think about how we have gotten to this point as marketers. Viewing youth marketing through a historical and generational lens can yield some insight. So, let’s travel in time together and look at the evolution of youth marketing.

If we go way back, to when the Silent Generation (born 1925–1942) were children, we see that these were the offspring of some very difficult times. They were children of the Depression and war years, and were characterized as desiring conformity and security. At this time the marketing world itself was just getting established, and marketers were struggling to promote their wares at a time of economic uncertainty and war rationing. There was no “mass” way to reach consumers, as movies/news reels, local newspapers, and magazines were the key media of the day. Youth marketing at this time simply didn’t exist. Marketers were treading careful waters with adults.

The Boomer Generation (born 1943–1960) brought forth a huge increase in the number of children in the US, as well as America’s prominence in the world economy. These were Dr. Spock babies – raised by permissive parents, who became quite rebellious and self-centered later. This marked the advent of the TV age, and with limited channels and programming, marketers could reach a mass of consumers at the same time. For youth marketers, we typically call this the “children are to be seen and not heard” era. This time period witnessed the birth of the brand management system. Many marketing techniques in use today were created and refined at this time. But, there was such unfettered growth in adult markets that children were largely an afterthought for marketers.

This changed as Xers (birth years 1961–1981) came of age. Xers were born at tough time to be a kid. Divorce rates skyrocketed, parents focused on their own achievements, and the term “latch-key child” took hold.  Xers have been fiercely independent ever since, as they had to learn to do many things on their own. Just as marketers had a new way to reach kids directly (Saturday morning TV, and later kid cable channels), many brands began to mature, and marketers started hunting for growth.  One place they found was children. But, at this time, we remained in a parent-centric world, so marketing to children was really done by proxy – by marketing to Mom. Marketers discovered the youth market at this time, but addressed this market largely via their mothers.

Then came the Millennials (birth years 1982–2004). This is a sizeable generation (the Echo Boom) that has been watched and studied since they were born. They are characterized by over-protective parents, being reared largely in boom economic times, and as being risk-averse, team oriented, and in constant need of affirmation. Far from the “children are to be seen and not heard” era, this period marked a transition where youth became a central focus of society. Digital media came on the scene, allowing more targeted marketing approaches. So, how did marketers address them? Marketers quickly saw opportunity in youth markets and started applying sophisticated marketing techniques to them. For most of this era, marketers made what we consider to be a monumental mistake:  they concentrated on youth largely to the exclusion of parents. There was a sense among marketers at this time that if you try to market to both parents and kids at the same time you will fail at both. Marketers (who often hailed from Gen X themselves) often felt children were as independent as they were, and despite the sophisticated tools at their disposal, had a difficult time understanding the partnerships that were developing between children and their parents.

Which brings us to today’s kid generation, the Homeland Generation (birth years 2005 onward). These are kids growing up not just in an era of protectiveness via their parents, but also via society and the government. Political leaders often couch their policies in how well they will keep our children safe. Our culture is concerned that our children truly might not be better off than we were. Homelanders are also very much a “home centered” generation, as they don’t need to leave home (because of technology) to be entertained or to socialize, and they don’t wander much towards unstructured activities.  So, what are marketers learning now?  Largely, they are learning that youth marketing isn’t a matter of applying previous techniques to kids. Decision making processes are much more complex. For instance, think about the decision to buy a new video gaming system for the household.  Who makes that decision?  Mom?  Dad?  The Child?  Who pays for it? Who makes the actual transaction?  Who uses it once it is bought?

The decision process isn’t so clear cut because what you are really marketing to these days is a collaborative decision making unit and not an individual.  There is a marketing firm in our industry who says that youth marketers need to realize that their consumer has two heads, four arms, and four legs. We have seen many marketers who desperately want to be “kid-centric” stumble because they don’t truly understand the role of parents and just how collaborative households have become.

Historians typically resist writing about anything that has happened in the past 20 years because it is truly hard to understand larger trends without the benefit of a long-term perspective. The same is true about youth marketing today. Someday we’ll be able to look back and document what happened, but for now our best path is to look to broader, generational trends, and realize there is something happening here and we don’t know what it is.

The Arbiters of Cool

Why has the consumer culture in the US become so youth-obsessed?

Why has the word “coveted” become inextricably attached to the words “18-34 year olds” among media planners and buyers? After all, it doesn’t take much more than a quick Google search to discover that older demographic segments spend much, much more.

We’ve grappled with these questions for quite some time. As a firm that conducts a lot of research among youth and on youth topics, we’ve certainly benefited from the nation’s obsession with youth.

Young people do have a lot of money to spend. Depending on whose projections you want to trust, teens spend somewhere between $150 and $200 Billion a year. That might sound like a lot, but when you look under the hood a bit you will find that the bulk of that spending power is concentrated at the upper end of that age range. Today’s teens certainly have more money to spend than their counterparts did a generation or two ago, but that spending level seems minor in comparison to what older age segments are spending.

The real answer as to why the media and marketing world is so centered on youth is INFLUENCE. Young people’s influence on the spending of adults is somewhere between 5 and 10 times their direct spending. Parents feel good when they are spending money on their children (and this type of spending is more immune to the business cycle than other types). Older people feel good when they buy products that have passed a “youth cool test.” Young consumers have become the arbiters of what is cool, and adults want to jump on board.

Most children’s first words are ‘Mama’ or ‘Daddy.’ My kid’s first words were: ‘Do I have to use my own money?’ — Erma Bombeck

Another reason you see so many ads targeted to teens and college kids is that adults “aspire backwards.” Below is a chart that runs from age 8 to 75. The question asked respondents, “regardless of your current age, if you could be any age at all, what age would you want to be?”

agegraph

The chart shows that up until about age 20, most people aspire to be older than they currently are. That is well known in youth marketing – so to attract say, a 12 year old, you put teenagers in the ads. It appears that in your 20’s and 30’s you are roughly happy with the age you are, but the moment you hit 40 you start to wish you were younger. Mid-life crisis anyone?

Finally, just as kittens become cats and puppies become dogs, young consumers become adults. Brand preferences can begin quite young, and a lifetime payoff can be substantial. By way of example, most US adults have a brand preference for Coke over Pepsi or Pepsi over Coke. Most will also drink the other brand if their preferred brand is not available. But, when faced with a choice of both, adults tend to show a brand preference that does not change over their lifetime. When is that brand preference formed? Early – likely by middle school. The lifetime value of establishing this preference early is huge, which explains why both brands continually race each other for the youth market.

So, youth are a substantial market, have an influence many times their size, and eventually become adult consumers. All the ingredients for a youth obsessed culture are in place.

I was recently reading an article that discussed how in China, the population reveres it older members. Evidently it is the law in China that you have to look after your parents in their old age, and there have been cases of elderly parents successfully suing their children for lack of support. Revering the old is not just cultural, it is mandated by the government. Our youth-obsession is a western-dominated concept, and one you don’t see in less consumer oriented areas of the word.

Time is Money; Money is Time

The most interesting call I ever received as a result of a poll we conducted was from a college student. We had released a data point demonstrating that college students have an enormous amount of uncommitted, free time — 8.5 hours a day on average to be precise. We defined discretionary time as time students are not sleeping, going to class, studying, working out, commuting, or working at a paid job. What is left is time that is up to the student how to use.

The college student called to tell me how this data point must be wrong, because all the college students she knew were incredibly busy. After mentioning that she must be hanging with a different crowd of people than I hung with in college, I told her to call me back in 10 years when she had a career, a spouse, a couple of kids, and a house to maintain. I suggested it is likely a matter of perspective and how you view your discretionary time, and that perhaps time that she considers “obligations” our researcher’s eyes classify as discretionary.

In the context of many decisions we make, we trade off the concepts of “time” and “money.” In the short-run, both are fixed commodities. In the long run, our financial situation may change for better or worse and our concept of time may change even though each day remains at 24 hours.

Our discretionary income follows a well-known path in our lifetime. It starts at zero when we are born, grows to a modest level as teenagers, tends to level off through the college years, grows considerably in our working years, and then falls off in retirement.

Discretionary time follows a different pattern. It starts out very high, moderates in the school years, grows considerably in the college years, and then pretty much falls off a cliff as individuals are raising their own families and building their careers. Discretionary time then moves upwards during the empty-nester time frame, and then is maximized in retirement. Note that we define discretionary time as “uncommitted” time – time that you get to choose how to spend.

The graph below illustrates how time and money progress over our lifetimes.

Time and Money

The interesting part of this for marketers is that “time” and “money” are often used to “buy” each other. We can buy more discretionary time by outsourcing aspects of our lives. I don’t change my own oil, plow my own driveway, or iron my own shirts. In all these cases, I value the time saved by not having to do these things more than the money it cost to outsource them.

This relationship goes the other way as well. We can use “time” to save “money.” I’ll sometimes spend hours on the Internet to find the best price for a flight or a hotel room. I’ll drive an extra 15 minutes to a grocery store because something I like is on sale there and not at the store closer to my home.

Look again at the graph above. The most interesting life stages are the ones where there is a big gap between the time and money lines. An obvious place where this happens is the college years. This is a time frame when consumers have relatively little discretionary income, but relatively high discretionary time. This concept is why for years we have been saying that college students are pretty much the most savvy consumer group out there. They are smart (hey – they are in college!), highly connected with each other, necessarily frugal with their funds, and have enormous amounts of time to research products and prices. But, they are more than cheap customers who have a lot of time to find the best price. They emerge as adult consumers, and lifelong associations with brands often start in the college years.

Another interesting point on the graph is at mid-career (30’s-40’s). This is the point where there is the largest gap between discretionary income and discretionary time. So, this is the life stage where we most see consumers trading money for time. Price sensitivity tends to be at its lowest during this time frame.

Money is time. With money I buy for cheerful use the hours which otherwise would not in any sense be mine. — George Gissing


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