The CQ: A "Richcession" and Malls Rebrand as Work-Live-Play Centers
The Forerunner team's must-reads of the week
The CQ is Forerunner’s weekly newsletter covering the most pressing consumer trends and analysis, as well as business-building insights from our investment team. Subscribe now to get the latest edition in your inbox every Saturday.
What the team is talking about on Slack
A recession is still questionable, but WSJ declares we’re already in a “richcession” — AKA the well-off are taking the brunt of the economic uncertainty. Highly skilled workers have been experiencing more layoffs, luxury home and stock prices have slumped, and high-end goods are feeling the hit. “Investors bracing their portfolios for the downturn need to think about how changes in consumption habits and spending priorities could be different when more-affluent consumers are the ones impacted.”
Ikea has a big idea with its new Planning Studios, which are small-format stores that focus on products related to city living in areas where big-box stores are hard to come by. There’s two in LA already and more are planned for Tokyo, Rome, and San Francisco. The idea of “small stores” is part of a larger retail trend of major brands, including Best Buy and Kohls, trying to evolve with the times to reach modern consumers.
The “motherhood penalty” is real. Mothers are, on average, 100% less likely to get a callback for a job and are offered $11,000 less when they do get a job offer, according to a sobering statistic from the new book, Screaming on the Inside: The Unsustainability of American Motherhood, by New York Times opinion writer Jessica Grose.
Gen Z has a new fave brand and it’s not what you think. Maseca corn flour ranked #4 on Numerator’s list of top Gen Z brands of 2022. The Mexico-based company, which started in 1949, has seen sales growth among young Hispanics. Of Gen Z, 25% are of Hispanic heritage, higher than any other generation — and many are discovering the brand through TikTok cooking videos of tortillas and gorditas. Another tidbit: all the brands on Gen Z’s top 10 list are related to healthy food or self care.
Struggling malls are rebranding as work-live-play centers in order to fill vacancies and attract young adults. Adding residences and even medical centers to a retail space offers a walkable main street feel and creates a community of sorts — which, of course, was how malls were initially popularized in the 90s. One real estate investment trust saw foot traffic rise 5.3% at properties that have a mixed-used element, while other retailers in its portfolio were up only 0.6%.
Gen Z fears their education has not provided them with practical knowledge needed to make it in today’s workforce. Employers are feeling it too with nearly 7 in 10 executives claiming they regularly have trouble finding employees with the necessary skills for positions.
While mortgage balances are the main form of soaring debt increases for Americans, credit card debt saw the biggest jump — a collective $986 billion at the end of last year, up $61 billion from the previous quarter. Delinquency rates are also seeing an uptick. Young adults in their 20s and 30s (many of whom are already knee-deep in student loan debt) are most likely to miss credit card payments.
Maybe debt is escalating because we’re now spending 22% of our income on basic necessities. The annualized cost of food, housing, and clothes has spiked 19.8% since pre-pandemic times. That 22% is even taking into account the trading down of more expensive goods (or eliminating them entirely) to cut down on costs.
Remember phone calls? These days, blocking off time for a phone chat with a friend is helping some people get through the loneliness epidemic. While most young adults dread talking on the phone like the plague, many women in their 30s and older find a phone conversation as a form of therapy — even if they have to send a Calendly invite first. Here’s another ode to a throwback: hanging out.
In her new book The Influencer Industry: The Quest for Authenticity on Social Media, University of Pennsylvania researcher Emily Hund is urging for policies that would protect influencers—and consumers. “Prioritizing fair pay and transparency in the industry would help incentivize influencers to share better quality products and information. But to even begin, government agencies, lawmakers, and company leadership must understand that shrugging off the influencer industry as a “Wild West”—a term used repeatedly—serves only to obscure its problems and allow them to perpetuate.”
Work at a Portfolio Company
Senior Associate, Lifecycle Marketing, Oura | Oura is on a mission to empower every person to gain a deeper understanding of their health, lifestyle, and sleep quality. This role will focus on driving the execution of lifecycle marketing efforts for user acquisition of Oura products and services.
Principal Partnerships Manager, fabric | fabric is the headless commerce platform purpose-built for growth. This role you will work on developing e-commerce and technology relationships, identifying high-impact opportunities, improving existing product integrations, trying out new experiments, and building the right teams.
VP, Engineering, Sunday | Sunday is a data-driven start-up empowering consumers to take better care of their land. This role will focus on building and managing highly productive software engineering teams, empowering engineers to deliver products that achieve company objectives.
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