'Y' We Have Momentum

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This industry, having weathered the Great Recession, is due to rebound. Since 2008 we've been told to have patience and hang steady. There's no question it's been a long trudge. Slight upticks have been met with backward slides. But the steady message from research and economists is that we are recovering. Slowly. Here's my outlook on the coming year, why I think pools and hot tubs have momentum and how we are capitalizing on it.

1. Millennials want to live in the suburbs.

Surprisingly, a new study by the National Association of Home Builders shows 66 percent of millennials (Generation Y) want to live in the suburbs. That's a very different message than what we've been hearing over the past several years. It's good news for this industry in that the single family home is still very much wanted and the lifestyle of pools and hot tubs can be created in a backyard as opposed to a high rise in the city. Plus, the housing market is stabilizing. This means prices will rise slowly, but affordability will worsen.

2. Consumer financing is loosening up and consumer confidence is cautiously rising.

While Freddie Mac's chief economist Frank Nofthaft has indicated interest rates will climb throughout 2015, consumers are finding ways to finance home improvements beyond the home equity line of credit. If you aren't already offering it, expect to have a financing available to your customers, similar to what was in place before 2008. APSP expects to launch its financing program for members this spring.

3. Astonishing personal growth in cash.

The upper middle class, core affluent and one percenters have cash. And lots of it. Most of Generation Y aren't necessarily in this group but they are expected to receive an inheritance. And that means potential future customers.

Data courtesy of YouGov. Refer to 'The Survey of Affluence and Wealth'.Data courtesy of YouGov. Refer to 'The Survey of Affluence and Wealth'.

4. The Internet has already made us reassess retail operations.

Many in our industry regard Internet sales as a threat to their business. This threat, or opportunity, is interesting through the lens of Generation Y. According to a 2013 article by Anders Parment in The Journal of Retailing and Consumer Services, baby boomers value the retail experience and in-store service more than Generation Y. For baby boomers, the purchase process starts with a trusted retailer who gives advice for choosing the right product, while for Generation Y, the purchase process starts with choosing a product. Given how technologically savvy millennials are, the Internet should be a valuable tool to entice and engage. Let's embrace the purchasing behavior of this demographic to sell more hot tubs and pools. Let's meet them where they are.

Chart Showing What Percentage Expect To Receive Inheritance

5 It's an open playing field for marketing to Generation Y.

Younger people are more likely to be enthusiastic about brands than older people. I think we tend to see older individuals exhibit a bit more skepticism about consistent brand delivery, while the younger generation tends to be more inspired by brands, and sometimes even use brands to convey qualities about themselves. In effect, they're more open to brand and advertising and our industry can and should capitalize on this through lifestyle marketing. APSP intends to do that.

The state of the industry depends on many things. Overall, our industry continues to transition through this economy while also transitioning from one generation to another. As we navigate these waters, we mustn't lose sight of changing demographics as we begin to cultivate the next generation of customers. It should be our goal to attract the buyers of tomorrow.

Chart Showing What Percentage Has Favorite Brands By Generation

For our part, APSP is launching a consumer outreach campaign this year to once again position pools and hot tubs in the consumer's mind. For far too long we've been on the sidelines watching other industries run organized and successful outreach campaigns that have competed against our products. Collectively, we have the momentum to grow the industry by reintroducing the lifestyle of pools and hot tubs to key audiences. Watch for the launch of the campaign and get involved. We can do this.

Comments or thoughts on this article? Please e-mail [email protected].

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