Editor's note: In what we plan to make an annual end-of-year tradition, RetailWire has compiled a list of the most significant retail industry "Turning Points" of 2008. (See our news release...) What follows is the sixth in a series of 12 discussions based on the list.
Cocooning first gained prominence after the 9/11 terrorist attacks when families began entertaining at home more as a way of bonding and saving money. But first due to rising gas prices and then to the slumping economy, cocooning once more became a buzzword for consumer behavior in 2008.
For much of the early part of the year, news stories around cocooning came about as surging gas prices forced people to skip vacations. More recently, sharp declines in home values and stock portfolios are said to be keeping people close to home this holiday season. Consumers are avoiding traveling, eating out or even heading to the movies.
"This is a different kind of cocooning compared with the nesting that occurred after the terrorist attacks of Sept. 11, 2001," Stacy Janiak, vice chairwoman at Deloitte LLP, told MarketWatch. "This is more a continuation of what we saw this summer with 'staycations.' People aren't going anywhere."
For food retailers, the cocooning trend has opened up opportunities to create meal ideas for the home. Some also point to more opportunities in hot tubs and barbecue islands backyard entertaining as well as the strong sales of flat-panel televisions, video games and other electronic gadgets for in-home entertaining. USA Today recently ran a page of gadgets that embrace the stay-at-home trend and are expected to do well this holiday season, including Nintendo's 'Wii Fit', Logitech's Driving Force Wireless, as well as updates to the Guitar Hero phenomenon.
Tech analyst Michael Gartenberg at Jupitermedia said that people are "investing in their living area and looking for value."
Trendwatcher Faith Popcorn, who popularized the "cocooning" term in 2001, called this year's approach "uber-cocooning" as budget-conscious Americans become "anti-over-consumers."
"It's a deeper and deeper snuggling down into the home," Ms. Popcorn told MarketWatch. She also noted that consumers are foregoing discretionary spending to a much higher degree than in recent years.
"None of us can afford to do anything we have in the past," she said. "And we won't miss all that stuff."
Women's Wear Daily also recently noted that, much like the period after September 11, consumers are looking for "small indulgences," such as comfy robes or bath and body products while avoiding big-ticket items. But the article also agreed that the cocooning trend is different this time .
"After 9/11, there was a presidential mandate to go back to our normal consumer habits," said Robert Thompson, professor of media and pop culture at Syracuse University. "Buying a pair of shoes or underwear was tantamount to doing a patriotic act. This is a whole different situation. Buying and spending will rehabilitate the economy, but the fear now is we're keeping company with the Great Depression and 'I'm the next one to be laid off.' People have got a sense they're in it for the long haul."
Discussion Questions: What short- and long-term effects do you see cocooning having on consumer spending? What merchandising and marketing opportunities is it opening up? How is it different than the stay-at-home trend that developed after the 9/11 terrorist attacks?