Customer Reviews

Treasure Hunt: Inside the Mind of the New Consumer

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4 star:		(10)
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2 star:		(1)
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What a fun read! I see myself in almost every chapter...and anyone who loves to shop will find themselves as well. Unlike most business books, Treasure Hunt is filled with stories of real people...and each had me saying "aha, I do that! I love knowing that someone else stockpiles goodies from Costco, or shops for designer scarves on ebay just for the fun of collecting them. And I feel better knowing that I'm not the only one scrimping on groceries so I can splurge on a fancy hair salon.
What really sets Treasure Hunt apart, however, is that while it's a great read, it's also full of strategic business insight. It's a must for every CEO [as well as his Mom]. Silverstein is the first to actually come out and say that today's consumer has a mind of her own...and a damned good one. Today's shoppers, primarily women, are savvy about value and won't settle for less....and each has her own sense of what's worth trading up for...and what's not. It's about time some recognized how much demanding consumers are changing the marketplace. In this book, we shoppers finally have a voice...and a loud one. And Silverstein says if businesses want to sell to us...they better listen!

Most of us believe we are pretty much like everyone else because we are pretty much like else everyone we know. However, this is almost certainly a false view of the world because of our very limited view of the world. Everyone we know is pretty much like us because we hang out with people pretty much like us. Statisticians call this a truncated sample. It is the goal of researchers in marketing to either look deeply into narrow samples of the market or to broaden the view much beyond what any one of us would likely to experience directly in our lives.

This interesting new book talks about what has happened to the middle market consumer who doesn't have enough to live upscale, but is certainly willing to be selective and can trade up market on items that matter to her and down market to find very satisfying purchases that also leave them the funds to splurge on higher ticket items and services. The idea is that for these folks, who have pretty decent incomes (especially when combining two incomes), and also have their spending under control, view shopping as an entertainment and finding what they want as a kind of adventure. The experience of finding something just right for less money is emotionally rewarding in a similar way to indulging the $600 designer purse is when they decide to go up market.

Michael J. Silverstein of the Boston Consulting Group (and his co-author, John Butman) take us into the budget and spending lives of several different representatives of this middle market segment and then into the some business case studies to show us the problems some face being stuck in the middle, how others are revitalizing themselves, and how some have successfully exploited this rewarding group of consumers.

Fundamentally, the issue is this. In the old days, manufacturers could make what they wanted, define the segment on their own, market to it, and sell everything they made. That doesn't work anymore. There are just too many choices. And the seemingly infinite number of choices for the consumer are not simply about direct competition. Substitution of emotional satisfaction can count as much as the function of the item. These consumers are looking for things in addition to the item itself and will buy from the vendor that provides them with the sense of having found the price and emotional value they are after.

Interesting read, especially for those involved in marketing to this segment.

[...] Since it isn't applicable to my business, this was more of a personal education read for me. I found the case studies to be interesting and could relate my own personal shopping habits to the theory in this book. I definitely polarize between extreme bargain hunting and carefully thought out splurges, depending on the item. I do neglect the middle market, but I wasn't consciously aware of it until I read this book. I also feel like I learned some new bargain hunting tips from reading Treasure Hunt - I can't wait to venture into the dollar stores that are all around but I haven't yet explored, for example. I was interested to read some of the stories about various brands who have been thinking about and acting on these theories. I realized that I started shopping at Bath and Body Works only after their recent re-envisioning. I also learned about the "LG" brand that I've been seeing everywhere over the last six months but hadn't heard of before. I think this is a good book for anyone who makes and sells products and provides services - my friends and I certainly shop this way and there are some useful insights for businesses. It is also an interesting read for people like me who just like peering into the mind of the modern consumer.

There is little doubt that the recession of 2008 will cast a long shadow into the future, and curtail much of the "wealth effect" discretionary spending that many consumers may have carelessly engaged in since the millennial turn. However, people will still continue to need and want various goods and services despite economic realities. More and more consumers are seeking for value - in its many forms, which include propositions such as sentimental effect, whimsy, feature-rich or rarity. In the book titled Treasure Hunt the authors postulate a significant move toward a seeking-type trend in consumerism that is reshaping the retail landscape. The authors write that middle-class women are driving this change but state that these consumers are bucking traditional buying patterns by flirting with purchases both above and below their means. While this may create headaches for those along the retail supply chain who like to categorize purchasers into cubby-holes, Treasure Hunt provides a refreshing look at the growing power of consumers which is one of the reasons Soundview recommends this book. Companies that are able to adapt to this shift should thrive during any economic cycle, while those that can't may not survive this current economic downturn.

The BMW in the Costco parking lot is the operative metaphor of "Treasure Hunt: Inside the Mind of the New Consumer." Silverstein describes the flip side of "trading up" -- the trend in the luxury sector that was the subject of his best-selling first book of the same name. Consumers are buying more pricey goods, he writes, but they are also "trading down" -- treasure hunting -- for bulk goods and items that do not have high emotional value.



The phenomenon creates huge opportunities for companies that figure out how to meet customers at the bottom or the top of the price continuum, and disaster for those stuck in the middle. Silverstein profiles the market, introduces us to consumers that exemplify a variety of buying behaviors, then shows us companies that have figured out how to adapt and win.



Laden with numbers, charts and examples, "Treasure Hunt" could be the treasure map for businesses seeking to understand better how their customers think and what they want. But it's almost more interesting to read it for the glimpses it gives of your own spending habits.

For anyone who is in the business of promoting a brand, this is a must read. It talks about the emotions of purchasing and hurrah, offers global examples vs so many other leading best sellers that are US only centric. Not only is it interesting from a sociological and cultural standpoint but it offers many examples of successful "back to basics" for anyone trying to create customer intimacy. From attacking the category like an outsider to successfully spotting trends and understanding emotional connectivity you will take away some great tips and have fun while doing so.

[...] unlike other books I've previewed, I got hooked on this one before I even finished the first page. The concepts of trading up, trading down, and the thrill of the hunt so aptly described just about everyone I know. My teen-age daughter's friends have two pairs of sweat pants that they wear over and over until they fall apart. But they all have Coach handbags and IPODs and every accessory.
This book is fascinating from the psychologicaly as well as business aspects. As a Human Resources professional, It has helped me look at my employees as customers who also trade up and down, but in terms of salary and benefits, not silk scarves and cheap paper towels.

Michael Silverstein explores the story of how people around the world are reshaping the consumer goods market by trading down to low-price products and services; trading up to premium ones; and avoiding the boredom and low value that increasingly characterize the middle. The author says that the consumers driving this change are mostly women, who have a sense of purpose and power when they buy and use goods and services.

According to the author, there are two rapidly growing pools of spending. At the high end, consumers are trading up, willing to pay a premium for top quality, emotionally rich, high margin products and services. At the low end, consumers are relentlessly trading down to spend the least amount possible on basic, low-cost goods that still deliver quality, reliability and, increasingly, an element of style. In between these spending poles lies a vast expanse of mediocre, often low-margin goods that lack distinctive emotional appeal or better value than their cheaper competitors. Companies selling these mid-priced products to middle-class consumers suddenly find themselves facing "death in the middle." Companies that succeed in this bifurcated market are those who understand the attitudes, behaviors and values of middle-market consumers and constantly alter and reinvent their product to satisfy the consumer.

The author says that today's consumers are highly skilled shopping experts. For them, consuming has become a treasure hunt--a constant search through the world's vast and ever-changing store of goods and services to find the perfect value every time. Such consumers spend their money with individuality---trading up in some categories, trading down in most and mixing upscale with downscale products--to create a customized lifestyle and standard of living suited to their own taste. For example, a $150,000 professional who buys $19 jeans at Target, flies Air Tran, and pays $100 for her dog to be groomed, as well as a $50,000 plumber who leases a $27,000 BMW and buys clothes at Kohls.

Trading-down companies have created 10 times plus the market value that trading up companies have created. Big winners include Target, Costco, Lowe's and Dollar General.

Whereas those at the top of the income ladder are rarely forced to make substantial trade-offs, and people at the bottom have few options, those in the middle constantly face difficult choices. In the United States, the middle class is defined as the 48 million households that earn between $50,000 and $150,000 per year. These people control 75% of discretionary spending, which means they control the market. They are not going into debt to trade up, nor is debt driving them to trade down. They do both because they can and want to. The purpose is not to just find the lowest price (if you are trading down) or highest quality (if you are trading up). It's to determine the right price for the right product at the right time and place.

Every middle-class consumer has a "want list" of things she wants to buy that is constantly revised. If you understand the want list of your consumers, says the author, you may discover that you are competing not only against other companies in your category, but also against completely different categories. For instance, if you make watches, your toughest competitor could be a handbag seller. If you sell flat-screen TVs, your toughest competitor might be a Caribbean cruise or a high-performance mountain bike.

Cheap used to mean bad. The cheap product was, by definition, of low quality. If you bought your clothes at K-Mart, it wasn't something you talked about. But the author correctly says that today, everyone loves a bargain and they brag about the low prices they get. It's a victory to spend the smallest amount you can, no matter how wealthy you are.

In 2004, 66 percent of households report having shopped at a dollar store, and higher-income households are the fastest-growing segment of customers. Retailers are looking for ways to fight back. Wal-Mart has been testing concepts for its own in-store version of the dollar store. One is called the "Hey Buck" section where food and soft goods sell for an average of 98 cents per item. Target has tested a concept called "One Spot" with merchandise priced at $1. The author says that the low-cost revolution will continue.

Best Value Inns (BVI), the fastest growing hotel company in the U.S., has become the preferred choice for business and leisure travelers who are seeking a clean room, free cable TV, swimming pool, mini-fridge and free morning coffee, and can only afford around $65 a night. A stay at a BVI is a smart use of money, according to the author.

Marriott seems to have mastered the difficult trick of succeeding at both poles of the market. Long known as a middle-market hotelier, they purchased the premium Ritz-Carlton hotels. They have also aggressively expanded in the trading-down market with Courtyard by Marriott properties for business travelers and low-price Fairfield Inns for leisure travelers. Marriott's biggest growth in rooms and revenue has come from its trading down brands.

All hotel owners are looking for ways to differentiate and respond to the bifurcation of the market. According to the author, the worst place to be is in the middle where average returns are below the cost of capital. The best place to be is at the bottom of the market.

LG, the $50 billion South Korean worldwide manufacturer of electronics, chemicals and industrial products, has accomplished what few companies in the world have done: transformed itself from a supplier of low-cost, poor-quality goods to a leading producer of home electronics and appliances that serve both trading-down and trading-up consumers. Today, their appliance division is possibly the fastest-growing and most profitable in the industry. They offer a $550 top-freezer refrigerator that competes with Frigidaire and Kenmore on the low end and a $3,100 model that competes with Sub-Zero at the high end. For LG, spanning the poles is about participating across the whole range of price segments in its market.

Then along came eBay. As more than 135 million registered users in 32 markets have learned, eBay offers the thrill of discovery every day. After just seven years of operation, eBay had created a market value of $42 billion--greater than the entire value of the department store industry of the United States which has been operating for a century. What eBay offers is a fantastic business model: an online community that brings 336,000 registered stores worldwide, many small or geographically isolated, into one global marketplace. The estimated average selling price is $36, so the population for buyers represents all income levels. Most users come from middle- income households who shop there for treasure.

People are looking for emotional highs. Winning companies invent new products that capture the consumer's imagination. The author says that taking action means innovating, not just more of the same, or considering acquisitions or increasing your advertising spending; but rather think about innovation as a series of waves of reinvention and change, each lasting three to five years and no longer.

This book should interest you especially if you are in the field of advertising. This book gives you insight into the psychology of buying. I found it very interesting as to how the new consumer ticks. There is a reasson why people buy what they do and you'll find out the information in this book. I applied the knowledge I gained in this book to my business. Great insight.

I loved this book. I found myself saying this book is about me while reading it!
I am this way in my life I buy things on sale and stockpile so when I want something that is a little more expensive I can afford to do it! Very enlightening and a very great read for the weekend.