The CQ: American Shoppers Remain Undeterred & Stand-Out Trust in Small Businesses
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What We’re Talking About on Slack:
American shoppers undeterred by credit strains and layoff threats. A new survey from Bloomberg found that more than half of respondents said consumer spending will stay strong or get stronger in 2024 despite continual news of corporate layoffs. “Inflation pressures have impacted a lot of consumers, but ultimately you still have a strong jobs market. They’re still going to feel comfortable and continue to spend.” Though, some analysts worry that Americans have increasingly been relying on credit to spend. Credit-card delinquency rates have surpassed what they were pre-pandemic and nearly 3.2% of card balances were at least 30 days past due, which is the highest share in more than a decade.
According to new research from Pew, Americans have lost trust in most institutions—except small businesses. About 86% say small businesses have a positive effect on the nation. In contrast, only 29% say that about large corporations and 38% believe banks and financial institutions have a positive impact. In fact, 68% of Americans think large corporations have actually had a negative effect on the country.
AI fuels a new era of product placement. Using generative AI, a digital image of a product, like a soda can or a bottle of shampoo, can be inserted into an existing scene in a YouTube or TikTok video. More and more creators are turning to this form of advertising for additional revenue. “This feels like I’m making my own genuine content, but it doesn't scream that I’m making an ad. There’s no obligation for me to talk about it,” says one creator. Product placements in the U.S. are estimated to be a $23 billion industry, and marketers and advertisers think it’s a smart way to target young consumers who tend to skip traditional commercials.
Activists are organizing to combat AI and other technology. “Now with nearly half of Americans worried about how AI will affect their jobs, Luddism has blossomed. The new Luddites—a growing contingent of workers, critics, academics, organizers, and writers—say that too much power has been concentrated in the hands of the tech titans, that tech is too often used to help corporations slash pay and squeeze workers, and that certain technologies must not be merely criticized but resisted outright.” Several unions, notably SAG-AFTRA, the Writers Guild of America, and the Authors Guild, have resisted the use of AI in their industries, and the Culinary Union has organized a strike against using AI to automate service jobs. These new Luddites are embracing the label, though they aren’t necessarily anti-tech. Instead, many are arguing over getting a seat at the table to play a part in how these technologies are used for the greater good.
As Facebook turns 20, social apps are being transformed, says The Economist. The new social media isn’t very social anymore: Apps like TikTok and Instagram deliver videos based on users’ viewing behavior not their social connections, overall people are posting less, and most debate and discussion has moved to closed platforms. “The problems raised by the new generation of apps suggest that social media’s flaws are also the result of the trade-offs built into human communication. When platforms swing back towards private groups, they inevitably have less oversight. When people escape their echo chambers, they may well face more extreme content. When users embrace harmless entertainment, they see less news. As social networks wither, platform operators and users should devote less time to the old battles and more to grappling with the new.”
The Wall Street Journal asks, is the $139 Amazon Prime subscription still worth it? Years ago, a Prime subscription went for $79, but fees have been escalating and some of the perks of membership have been vanishing. “It’s hard for consumers to assess the value of bundles such as Prime, and that’s by design. Subscriptions are successful in part because many customers don’t keep track of usage or changing offerings—and often forget to cancel. There is a lot of bookkeeping that needs to happen.”
TV is back in its commercials era. Amazon Prime, Netflix, and Disney+ have all recently introduced ad-based subscription tiers that forces viewers to either sit through commercials or pay an extra fee. Analysts say Amazon will make out regardless of what consumers decide: If viewers pay for the ad-free tier, that’s $3 more per person; if they opt out, Amazon makes money by showing ads. What’s also interesting is how streaming shows were created to accommodate binging with a stronger focus on cohesive seasons. Now with commercial breaks back in the picture, will that focus shift to individual episodes with natural breaking points for ads like traditional network shows?
Alternative therapies go mainstream. More than a third of Americans now supplement or substitute medical care with therapies like acupuncture, meditation, or yoga to help with overall wellness, stress and pain management, sleep, energy, and immune health. In 2002, only 19% of adult pain patients used alternative therapies, but the percentage has jumped up to 37% in 2022. In particular, the number of people practicing yoga to manage pain increased to 29% in 2022 from 11% in 2002. Likewise, meditation has risen in popularity with 17% in 2022 opting for it as treatment, compared to 7.5% in 2002. The broader acceptance of these types of nontraditional medical care has been driven by several factors including growing insurance reimbursement for clinical alternatives, increased scientific evidence of their effectiveness, the influence of media and social media, patients looking for alternatives to opiates in addition to the low cost involved.
The hottest new bedtime for 20-somethings is 9 p.m. “All of a sudden, it’s so much cooler and way more accepted to sleep early, and everyone has just adapted.” The average amount of sleep adults in their 20s are getting—nine hours and 28 minutes—has increased 8% since 2010. And bedtimes are gradually getting earlier: those between 18 and 34 went to bed at 10:06 pm on average this January, compared with 10:18pm last year. A big part of the shift is that young people have a deeper understanding of the benefits of sleep on their health. And businesses have been adjusting to this change—for instance, some bars have added matinee dance parties and daytime events—and restaurant seatings between 4 p.m. and 6 p.m. now make up 31% of Yelp reservations, which is a 12% increase from 2017, while reservations between 6 p.m. and midnight have decreased.
TikTok is testing a new feature that makes all videos shoppable. The new technology is designed to identify objects in a post and then offer viewers similar items to buy through TikTok Shop. Because users have complained that the prevalence of ad-like posts from creators is ruining the experience of the app, this feature would allow creators to make commissions without the hard sell, and therefore improve the entertainment aspect of their posts. Still up for debate is how good of a match the recommended items are to the originals in the post.
The Financial Times delves into how founder Emily Weiss and CEO Kyle Leahy have steered Glossier in a new direction.
Forbes profiles Sika Health’s founder, Ami Kumordzie.
Zola co-founder Shan Lyn-Ma visits the Second Life podcast to talk about how she got to where she is.