What is the “consumer trend” that will dominate the lighting market in the future?
Millennials, Gen Z, authenticity, price-to-satisfaction ratio and brand keywords
Written by : Jung-Bae Kim / Publisher & Editor. Lighting Critic.
The world is constantly changing. So, what should lighting companies use as a standard to plan their future business? To alleviate these concerns of global lighting companies,'World Lighting News' summarized the consumer trends that will lead the lighting market in the future. <Editor's Note>
The ‘downsizing’ wind seems to be strong due to the increasingly deteriorating business environment. We need to do business in line with the millennials who have emerged as the center of consumption. Differentiation of technology, price, design, and brand will also
become an important trend.
As the price competition intensifies, lighting companies in each country are facing a
situation in which they cannot obtain sufficient profits by selling their products. As a
result, the lighting market in each country is
sluggish, companies' sales decline, and profits continue to decline.
In addition, as manufacturers from countries that have fallen behind in price competition with China continue to move their factories to low-wage countries such as China, Vietnam, Indonesia and Malaysia for 30 years since 1987, jobs in countries around the world are
The remaining jobs are filled by foreigners from China, Vietnam, and Mongolia because of the youth who avoid the 3D industry. These foreigners use only the minimum amount
necessary to live in the country and remit most of their income to their country.
Therefore, as the number of foreign workers increases, the national wealth of each country decreases.
◆ Why are lighting companies getting more difficult?
In addition, there is a widespread phenomenon of “manufacturers becoming distribution enterprises,” in which products are imported from countries with low product prices such as China and Vietnam, and supplied to the domestic market instead of producing them
domestically. One of the representative industries where these things are happening is
Lighting is an industry that is different from other industries. For example, designing
lighting fixtures is a very creative and highly knowledgeable, experienced and skilled field. In other words, it is the'design industry' that I think of as the best job these days.
representative labor-intensive assembly industry that produces inexpensive products
centered on low-wage labor, which is not highly skilled. It is not too much to say that the lighting industry is the industry where the high-level design industry and the low-wage
assembly industry coexist.
That's why many lighting companies can be created in any country. In the case of Korea,
for example, in 2008, after the Korean government announced that it would foster the LED lighting industry, more than 2,000 LED lighting companies were formed within a few years.
When so many lighting companies enter the market, the market competition of lighting
companies becomes more intense. The problem is that the point of market competition is not quality or design, but price competition.
This situation is almost the same in Korea, but also in countries where the lighting
industry has been activated to some extent. This is why the prices of lighting fixtures
around the world are falling year after year. As a result, lighting companies in each
country are experiencing a crisis of declining imports even if they sell more lighting
products each year.
Considering this point, what country to talk about and the common problem of lighting
companies is "How can I increase sales and profits?" Concentrate on doing. The problem
is that even if lighting ompanies blindly create new lighting fixtures and put them on the market, the number of them sold is decreasing.
There are many reasons for this to happen. However, the biggest reason among them is
that lighting product manufacturers are not able to keep up with the trends in the market and consumers.
Korea, there are many companies that started their business between the 1960s and 1980s. However, the millennials and Z generations have recently emerged as central forces in
the consumption market. They are between 20 and 30 years old. In the meantime,
consumers who buy products in the lighting market have changed.
As a result, there was a so-called 'generational gap' between a lighting equipment maker and a lighting equipment purchaser. In short, millennial consumers today prefer products
from companies hat they like, differentiate themselves from the products used by others,
and are good and reputable. Their loyalty to the brand is also very strong.
On the other hand, there is a strong tendency not to purchase products from companies
that do not fulfill corporate social responsibilities, ignore consumers, or deceive
consumers. So just because you make a good product as in the past does not mean that
the product is sold by itself.
In this regard, it is important to note the trends of consumers who will lead the lighting
market in the future. This is because if lighting companies know exactly the tendency of
consumers to lead the market in the future, it will be easier to do business.
◆ What is the Millennials?
The millennial generation is the class that will lead consumption in recent countries
around the world. Most experts view the generation born from the 1975s to the 2000s as millennials. Because most of the millennials are children of baby boomers born between
1946 and 1965, they are also referred to as baby boomers (echo boomers).
Millennials are far superior to other generations in their ability to use information and
communication technology (IT) such as mobile and social network services (SNS) using the Internet from adolescence. The university entrance rate is also relatively high.
As they grew up, they suffered employment difficulties and poor job quality due to the
global financial crisis in 2007. As such, I have low average income, avoid financial
investments, delay marriage, and are not active in my home arrangements.
information (such as blogs) more than traditional marketing means, advertising, and are
less interested in luxury brands than other generations.
On the other hand, he is a new human being who has a clear assertion, wants a certain
reward as much as he has made efforts, and prioritizes individuality and taste over
organization and personality over print.
Today's consumer market revolves around these millennials. Therefore, it is today's reality
that it is difficult to do any business without knowing the mindset and behavior patterns
of the millennials.
◆ Generation Z
consumption market. “Generation Z,” succeeding the “millennial generation,” is also a
“power group” that companies cannot ignore.
'Generation Z'in a word refers to the next generation of'millennials'. It is a group born
after 1995, and it can be said to be '1020 generations', from under 10 to 23 years old.
The word that best represents 'Gen Z' is'Digital Native'. These are the generations who
have grown up exposed to the digital environment since childhood, and are not only
familiar with new digital technologies, but also actively use digital devices for consumption activities.
Most of the “Generation Z” were minors until 2017. However, by 2018, about 3.36 million people, or 50% of the total, became adults. It is clear why companies these days should
focus on “Generation Z”. This is because'Gen Z'has fewer numbers than the previous
generation, but has a great influence on society as a whole.
In fact, according to a study conducted in 2016 by the marketing company'Interaction',
70% of'Gen Z'parents rely on the advice of their children,'Gen Z', when buying items
online. In particular, it was found that it exerts more influence when purchasing products with large expenditures such as furniture, home appliances, and travel.
◆ Trust and authenticity
shopping is very natural. In particular,'Gen Z's account for more than 50% of all shopping online.
Their product selection process is also very different from previous generations. Use social media or blog reviews to carefully review product reviews and purchase carefully. False
advertisements and exaggerated advertisements such as “I like our products”
unconditionally are what “millennials” or “Generation Z” hate most.
The most interesting thing about the'millennials' and'Gen Z'is that 67% of Gen Z who
participated in the study to find out their consumption behaviors prefer to buy in-store
rather than online when buying the products they need. will be. This shows that despite
the development of e-commerce, “in real life (IRL) shopping” is still dominant to
This trend is more pronounced in'Generation Z'. According to a survey, 74% of
“Generation Z” spend their free time online. However, as much as shopping, I like 'the
experience of shopping directly at the store'. In addition, special value is placed on
searching for signature items that can express one's personality.
Meanwhile, “Generation Z” is very curious about how the money they invested was
spent and whether the consumption was reasonable. It gives meaning to not only the
product but also the ethical awareness and social role of the company that produces the product, and it tends to not use the product of a company that does not correspond to it.
n fact, in a survey conducted by Futurecast, an American consulting firm, 60% of teens
answered that they "will consume brands that are faithful to their social role."
◆ Cost-effective ratio
As described above, the concept of consumption is 4050 generations, which have a huge
influence on the “millennial generation” and the “millennial generation” that have
established themselves as the mainstream in today's society and consumption market.
It is clearly distinguished from the 6070 generation.
The biggest difference is the fact that “economics” is very important. For example, in the
case of 'Pyeongchang Long Padding', which was a big hit during the 'PyeongChang Winter Olympics' held in Korea in 2018, it was a hit because of the'cost-effectiveness (quality for price)' that the price was significantly lower than other products of similar quality.
Therefore, in order to catch the attention of the “millennials” or “Z generations,” the
“quality-to-price ratio” must be excellent.
One more step here is 'psychological satisfaction for the price ratio'. Starbucks coffee is a good example of what ‘psychological satisfaction’ is. Starbucks coffee is more expensive
than other coffee shops.
Nevertheless, many people buy and drink Starbucks coffee while waiting in line. When you ask them why they are so insistent on Starbucks coffee, most respond with
"high psychological satisfaction ratio." This is a good example of what it is to say that
“high cost of appreciation ratio” is.
What is the reason why they feel “high cost of appreciation ratio” while drinking Starbucks coffee even though they are paying such a high price? In response, experts are evaluating that "Starbucks' brand image gives great satisfaction to customer sentiment."
As is known, Starbucks uses 100% Fairtrade beans. This means protecting the community and the environment and pursuing common social goals. These factors form the “good
image” of Starbucks, and the “good image” becomes the “brand image”, leading to
customers repurchasing Starbucks coffee.
◆ Brand?, brand, brand!
and drinking Starbucks coffee at a high price is because of the “good image” of Starbucks. Meanwhile, a good image for a company will soon become a'brand image'. Summarizing
this, what drives the market and consumers eventually becomes the term'brand'.
So what is a'brand'? Brand is the set of images and experiences that distinguish a
company. Also, a brand is an intangible asset of a company, and represents the value that represents the company in consumers and markets.
There are several reasons why many scholars and executives value maintaining brand leadership. First, it's because old brands get customers' attention.
contrast, a new brand or a brand with a small market has to incur high marketing costs to enter the market and gain recognition.
Second, market leaders can take advantage of economies of scale. Therefore, compared to competitors who have secured a narrow niche market, they can enjoy higher profits
through efficient management policies.
Third, market leaders who have already dominated in certain sectors can expand their
franchise to new related sectors, and can easily dominate in new sectors. On the other
hand, companies that have not become leaders are releasing thousands of new brands
each year, but most of them disappear from the market without a trace.
Therefore, it means "doing business means creating a brand." Once created, a 'brand'
retains its power for decades. And over time, the power of the brand becomes more
powerful. So, by creating a “Brand Building,” the company can reliably and successfully
drive its business for decades.
In addition, consumers are attracted and driven by a strong “brand”. For this reason,
'brand' is also a strong adhesive that creates customers by itself and holds firmly to
there are only two places where consumers buy products. One is Samsung Electronics, and the other is LG Electronics.
electronic rice cooker that consumers buy is only a brand product called Kuchen, which is its competitor, unless it is a brand called Kuku. What they have in common is the fact that they have a'brand' and are well known to consumers.
Putting these points together, there are five keywords for consumer trends that will drive
the lighting market in the future. It is ▲millennial generation ▲generation Z ▲trust and
authenticity ▲price and psychological satisfaction ▲brand. This is a key point that global
lighting companies must include in their business strategies in preparation for the
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