Bankrupt!: Ominous Housing Market Bubble

2 Million Homeowners Facing Foreclosure

A new Center for Responsible Lending (CRL) study reveals that 2.2 million American households are likely to lose their homes and as much as $164 billion due to foreclosures in the subprime mortgage market.

The CRL study is the first comprehensive, nationwide review of millions of subprime mortgages originated from 1998 through the third quarter of 2006.

CRL's research suggests that risky lending practices have triggered the worst foreclosure crisis in the modern mortgage market, projecting that one out of five (19.4%) subprime loans issued during 2005-2006 will fail.

"In the subprime sector, the most vulnerable borrowers are sold the most dangerous loans," said Mike Calhoun, CRL president. "At $164 billion, the losses from foreclosures could pay for the college educations of four million kids. For families who lose their houses because their loans fail, savings and economic security will be way out of reach."

The report discusses a number of factors that drive subprime foreclosures -- in the majority of cases, borrowers receive high-risk loan features, packed into an adjustable rate mortgage with a low start rate, that is approved without considering whether the homeowner can afford to pay the loan after the rate rises.


Adjustable rate mortgages known as 2/28s (or "exploding ARMs") operate with an initial "teaser" rate for two years, followed by a steep payment increase. And, regardless of a borrower's credit history, the almost one-quarter of American families who get subprime loans find them crammed with other high- risk terms such as prepayment penalties, limited income documentation, and no escrow for property taxes and hazard insurance.

In recent years, high appreciation in many areas has masked problems in the subprime market. CRL projects that the cooling housing market, will cause failure rates to rise sharply in many major markets. California, Arizona, Nevada, and greater Washington, DC will be especially hard hit.

Trouble in the overall subprime market spells trouble for African American and Latino families across the country. Although white families receive more subprime loans overall, blacks and Latinos receive a higher proportion of high-cost loans than any other group, a fact consistently verified annually by data lenders submit under the Home Mortgage Disclosure Act (HMDA).

The report, "Losing Ground," estimates that 8 to 10 percent of all black and Latino families who received a home loan in 2005 will be affected by subprime foreclosures.

"Homeownership rates for minorities are up but so, too, is the cost of that homeownership," said Wade Henderson, executive director of Leadership Conference on Civil Rights. "We need rules to curb predatory lenders, but we also need prime lenders to step up for this expanding market of borrowers."

And It's Not Just the Subprime At Risk

The delinquency rate for residential mortgage stood at 4.67 percent of all loans outstanding in the third quarter of 2006 on a seasonally adjusted basis. That's up 28 basis points from the second quarter, and up 23 basis points from one year ago, according to Mortgage Bankers Association's National Delinquency Survey.

"The housing market continued to normalize in the third quarter of 2006. Although labor markets remain strong, the pace of job growth has slowed, as has the home price appreciation rate which has decreased in response to higher interest rates and rising inventories of unsold homes," said Doug Duncan, MBA's Chief Economist and Senior Vice President of Research and Business Development. "Some states experienced home price declines in the third quarter, and a few have experienced declines over the past six months."

The percentage of loans in the foreclosure process was 1.05 percent of all loans outstanding at the end of the third quarter, an increase of six basis points from the second quarter of 2006, while the SA rate of loans entering the foreclosure process was 0.46 percent, three basis points higher than the previous quarter.

Compared with the third quarter of 2005, the percentage of loans in the foreclosure process was up eight basis points while the percentage of loans entering the foreclosure process was up five basis points. This quarter's NDS results cover over 42.6 million loans (32.6 million prime loans, 5.8 million subprime loans and 4.2 million government loans).

The delinquency rate increased during the third quarter for all loan types. The delinquency rate increased 15 basis points for prime loans (from 2.29 percent to 2.44 percent), increased 86 basis points for subprime loans (from 11.70 percent to 12.56 percent), increased 35 basis points for FHA loans (from 12.45 percent to 12.80 percent), and increased 23 basis points for VA loans (from 6.35 percent to 6.58 percent).

During the third quarter of 2006, the foreclosure inventory rate increased across the range of loans. The foreclosure inventory rate increased three basis points for prime loans (from 0.41 percent to 0.44 percent), 30 basis points for subprime loans (from 3.56 percent to 3.86 percent), eight basis points for FHA loans (from 2.20 percent to 2.28 percent), and two basis points for VA loans (from 1.10 percent to 1.12 percent).

Subprime Lender Implosion: Bad Omen For Housing Market

Subprime lenders have been both blessing and bane in the housing industry for many years, enabling lenders to rake in huge profits while saddling consumers with exorbitant loan terms and high interest rates.



Now, as the housing market slows to a crawl, many subprime lenders are collapsing faster than homes made of substandard materials, and the signs point to even more pain in the housing market as a result.

Mortgage Lenders Network USA (MLN) announced it was shutting its doors this week, as a result of market economics the lender said were "not good ... it deals with the performance of loans, and to a lesser extent the value of homes."

The last few months have seen a flurry of subprime lenders shut their doors, declare bankruptcy, or engage in mass layoffs as the housing market freezes up. Ameriquest, formerly the country's largest subprime lender, collapsed quickly after its former CEO, Ronald Arnall, was appointed by President Bush to be ambassador to the Netherlands. Other subprime lenders potentially on the chopping block include Countrywide Financial and H&R Block's mortgage unit Option One.

Subprime mortgage lending grew an average of 25% a year from 1994 to 2003 and now is a more-than-$330-billion-a-year industry that provides about 1 in 9 U.S. mortgages. The growth has helped broaden homeownership — nearly 70% of American homes are occupied by their owners — and given a boost to minority home buying.

Subprime lenders provide mortgages or home equity loans to people, including high-income borrowers, who don't qualify for conventional financing. Such lenders accept credit scores below the 620-660 threshold generally needed for prime financing and require less-stringent income documentation.

But critics say many of the subprime lenders' clients could qualify for conventional loans. Subprime lenders offer mortgage rates that sometimes range into double digits, though they can be as low as 6% to 7% for those with near-prime credit. Costs rise, often steeply, as credit scores fall.

The failures of subprime lenders are bad tidings for the housing market as a whole. Although economists and realtors continue to claim that the housing market slump has hit bottom, many still see delinquencies on the horizon.


Sources: ConsumerAffairs.com and USAToday.com

Graffvertising

I recently read an interesting masters thesis written by Alex Kataras of Saint Martin's in London. He suggests that graffiti art is a by-product of a society that grew up being flooded by advertising messages.

"Is it a coincidence that graffiti was spawned in New York, arguably the world's most advertising saturated and simultaneously most media savvy city. One can argue that graffiti is the by-product of a society inundated with advertising...I suggest that young children in New York, and teenagers in particular, having been exposed to the caliber of marketing and advertising over there, have created just that; the need to stand out in a visual landscape replete with popular culture, advertising billboards and signs of all types, regurgitated in the form of graffiti art."

The last part of his argument includes a discussion of how major art movements (Impressionism, Futurism and Pop Art) have evolved as a reflection of societal changes and its relation to the inception of graffiti art.

“…I can only come to the conclusion that graffiti art is the logical progression of art. A combination of art, popular culture and the guiding principle of advertising which is omnipresent.”

Kataras makes a very interesting argument, but it seems to be a bit of a stretch, as it appears to be almost too logical. On the other hand, maybe it is rather simple. We all know and can relate to the power of brands, so in some way it’s not that difficult to understand that some people are willing to take building their identity/'brand' (making their mark) into their own hands as a form of personal expression.

What interested me as much as Kataras’ thesis was his discussion of the parallels between graffiti and advertising. I agree with him that on a fundamental level graffiti can be seen as sort of a form of advertising and that the “tag” is essentially the individual graffiti writer’s brand (most people don't want to see either). We have seen graffiti and street art evolve as the practitioners have realized the power of iconic brands. Obey and Banksy are two perfect examples. Obey, whom is considered a sellout by many in the graffiti sub-culture, has evolved his brand to worldwide prominence and has used it to develop a cult like following which has helped him create a succesful clothing line.



Banksy who has been discussed here in the past has used the mysteriousness and conceptual nature of his brand to sell his paintings for big bucks. Below you will also find an interesting example of the graffiti writer BNE and the recognition his 'brand' has received.


Not anything profoundly new (especially to you planners), but graffiti more than ever is becoming a part of popular culture. Marketers are using it as a vehicle and/or concept to deliver their brand’s messages, as seen with this recent Timberland example.

In fact, graffiti itself seems to be a concept that is starting to stand on its own, as we can see with the success of the first ever graffiti video game, Getting Up.

Culture: A Moment of Silence...

RIP Godfather of Soul (and Hip Hop)
May 3, 1933 – December 25, 2006

"Prisoner of Love/Please Please Please"

*This version of "Please Please" has got to be the tightest performance on tape, bar none (well worth the 13 minutes)

Culture: 1979-2006: A HipHop Odyssey

BBC Radio's HipHop M1X Show recently webcast an epic (record breaking?) mix featuring over 800 classic HipHop tracks from 1979-2006 in 48 minutes.

Download this instant classic here. Read the whole track list here.

Mass Interactive: My Super Proposal

Following upon the heels of pioneers like Million Dollar Homepage and half a dozen other web appeals to help a fella get over thru our collective support, an enterprising groom-to-be, who will only identify himself as J.P., is attempting to recruit corporate sponsors for his planned marriage proposal as a $2.5 million Super Bowl ad.

The anonymous digital entrepreneur has set up a website to promote the effort - and the site itself has already raised about $74K toward the project. J.P. says he is donating all money raised to a children's hospital.

J.P.'s marriage-proposal-as-an-ad project has been pitched to marketers including diamond retailers and Las Vegas hotels. The stunt has thus far landed J.P. on five radio stations and "Inside Edition" is reportedly planning a mention of the project.

via Ad Age

Ad Agency Deathwatch: Screen Grab

Fast Company asks: "Is a brand what we see on the tube, or what we experience?" Saatchi & Saatchi's Worldwide CEO Kevin Roberts takes on Ogilvy's Brian Collins, Executive Creative Director, Brand Integration Group, in this extended debate.

Advergaming: Burger King Games (over 2M served)

Mediapost's Gaming Insider reveals the top gaming experience on the Xbox 360 this year isn't "Gears of War", but rather, the Burger King.

Microsoft and Burger King can't stop talking about how "Sneak King," "Pocketbike Racer," and "Big Bumpin'" three advergame titles released late in November, have outsold "Gears of War," the current hot title for the 360. According to Burger King, they've served over 2 million of these titles at $3.99 each, with the purchase of a meal at any of their restaurants. The games all feature the BK mascot--the plastic-y king who is at once funny and terrifying, as well as the famous Subservient Chicken.

Burger King's advergame is stacking up to be one of the most successful such campaigns ever launched. It's not an especially crowded field--most advergames are Flash games, hosted on microsites, and played by cubicle drones and tech journalists wondering how they can possibly write 250 words on a game about bathing toddlers. But there are a few gems: "America's Army," produced by the U.S. government as a recruitment tool, is widely considered one of the most successful advergames. Twenty-eight percent of the visitors to the "America's Army" Web page click through to the recruitment page, and 19% of 2003's freshman class at the U.S. Military Academy stated they had played the game.

So what did Burger King do right? Company strategists leveraged an extremely recognizable, even iconic part of their brand--that creepy, creepy King--and they hired a firm that knew what it was doing to create the titles. The company on the job was Blitz Games, which developed "Fusion Frenzy"--a party game that amounts to a bunch of casual games slapped together. "Fusion Frenzy" was never a huge hit, but all its mini-games were fun and addictive, which is really all you need for a solid advergame title. Plus, they were selling Xbox 360 games for $4 apiece, when the standard price point is $60--a tough deal to pass up.

Industry: Radio and American Music Culture

American Radio Works presents Hearing America, a Century of Music on the Radio

Sounds rather academic, but actually a compact and enthralling presentation exploring American Radio and it's historic influence...the introduction of 'clear channel' radio that spread NY-networks across more of the rural listenership, creation of "country" music as a backlash to the refined opera and classical programming that ruled the airwaves, the diversification of music taste thru introduction of jazz and black music styles, introduction of rock 'n roll (aka black music) and the slow dissolution of the style for white tastes, the invention (and later dominance) of the modern R&B format and Country format.

Entertainingly edited and puts the current radio format dominances all in perspective.

Inbox of Immaturity: The Holidays: Final Chapter

Don't let Rosie or Donald ruin your holiday. Take the time to de-stress and enjoy your family and friends.

The IOI must give thanks to YouTube for a year of laughs and YouTube must pay tribute to NBC and SNL, specifically to Andy Samberg and Lazy Sunday. It seems the year has come full circle with NBC now having a channel on YouTube. Without further ado, here's the video you've all seen a million times, but spreads the holiday cheer nonetheless:

The now infamous gift

Shoutout to Aaron for being first to send the Unrated version early Monday. And for a couple more laughs from NBC:
Triumph the Comic Insult Dog and The Delicious Dish

Freedom in Mess

Here's a book I can't wait to get my hands on: "A Perfect Mess" by Eric Abrahamson and David H. Freedman. I take so much crap for the state of my desk (see below) especially in comparison to the pristine condition of some neighbors.

Now I know I was just a lost sheep, wandering around in my own realm of clutter and shortly, I will be reunited with my kind--people who embrace a little mess, who can see the value of piles and "areas" and now, with this book under our arms, the ammo to be fine with it.

In addition to the inevitable genius held within the pages of this book, the New York Times reported today on the glory of mess, and defined several categories of mess (my desk fits best into vertical mess—using the power of the pile, my articles are all stacked into the appearance of order). I think the part of this mess movement that I like best is that it's calling it what it is, and that's all. I'd like to predict a trend in 2007: the de-stigmatization of mess!

IOI Special Report: American Immature Young Men

The Sethsus Bureau has recently surveyed a very specific group of young "professionals" about consumption of media, breakfast, and electronics. Details: 15 respondents - ages 25-27, college educated, living in major urban markets in the Northeast U.S., but with very different jobs (private equity to A&R rep to government). Here are the findings:

• Spend on average 20.5 hours/week on the Internet. (Most popular sites: Espn.com, Google.com/Gmail, and Yahoo/YahooMail)
• Spend on average 11 hours/week watching TV.
• Spend on average less than 1 hour/week (.86 repeating) listening to the radio. (Raised significantly by 1 participant with XM and 1 who listens to Internet radio)
• Spend on average 10 hours/week listening to their iPods. (2 people do not own an iPod. Ha-losers. What? Sorry. And only 2 download podcasts)
• Spend on average 4.5 hours/week on their cell phones. (Approximately 50/50 texting to calling ratio.)
• Go to the movies on average 1 time/month.
• 25% subscribe to NetFlix.
• 60% have DVR or TiVo.
• Spend on average 4 hours/week working out.
• Eat breakfast on average 4-5 times/week.
• Go to the bathroom on average 6-7 times/day (3:1 ratio of #1 to #2)
• 8 out of 15 plan on going to graduate school in their lives. (1 uncertain)

Most popular "biggest concern for 2007" was B-school followed by $ (generally, for school, for engagement ring), career, and then GWB, Cholesterol, Adjusting to new city, and How awesome I'll be with 1 vote each. (Yellow Cake was a late submission and thus excluded from overall report.)

One thing you can't live without include: Water (with most votes -- LEARNING ALERT: Be careful how you word questions! There are a lot of sarcastic (or smart, depending how you look at it) people out there), BlackBerry and iPod tied for second, Food related items in third (Cheese, Popcorn, "Food"), and with one vote each—Phone, Car, Friends, and my personal favorite from a risk consultant "Instant access to information."

Finally, the best purchases of 2006 were new TV (with most votes -- LEARNING ALERT: 4 of 15 claimed new TVs bought this year were best purchase, probably the same as how many bought them. However, not 1 of them named the brand! The went into detail with size and type : 46" LCD, plasma, DLP, etc.) but not Sony, Samsung, Panasonic, etc. OPPORTUNITY HERE.), iPod in 2nd, Plane tickets to...(INTERESTING - "It's all about the memories, man. See if I invite you to the reunion!") in 3rd, and with one vote each—DVR, Soccer cleats, Car, Apple computer, Tumi luggage, (THERE WE GO ON BRAND WOM), and Custom-made English leather army biking boots.

NOTE: The most interesting feedback I had was this: SURVEY THESE GUYS ON A FRIDAY!
I've tried to get these mofos to answer questions on everything from beer ("Come on, what do you think of Sam Adams Light? Seriously, I might be able to hook up free cases!") to fashion to favorite ads, and I'm usually lucky for a 25% response rate. But last Friday I hit 75% in one day (received 15 out of 20).

(Photo by: Matthew Johnson )

Inbox of Immaturity: The Holidays: Part Three

Yes, one great thing about the holidays is the “Christmas sweater” party. Find great holiday sweaters here.

Speaking of parties, ours is tonight. Check out our band flown in from Germany.

It’s also pretty fun to eat cookies, but Alyson warns not to get carried away.

Speaking of cookies, Soy is making our kids gay.
Radio show helps you catch a snake. (Long but worth it.)
And finally, PS3 can’t catch a break, but will (with Wal-Mart's brillance) help you dislocate your jaw.

Web 2.0: The Unseen Video

The Unseen Video (for electronic artist Mike Milosh's "You Make Me Feel") is a dynamic music video that changes it's look based on your local weather forecast.

The video's server connects to your local weather station and gets the forecast, and then interprets this forcast to alter the background color, motion and the ornaments within the video.



The idea is better than the actual execution, but a good effort and a peek at the ultra-customized future in store for us all.

Average American: Census Bureau 2007 Statistical Abstract of the US

NY Times provides an eclectic portrait and a audio podcast profiling Americans that is drawn from the 1,376 tables in the Census Bureau’s 2007 Statistical Abstract of the United States.

Some statistical stew:

-Americans drank more than 23 gallons of bottled water per person in 2004 (more bottled water per person than beer) — about 10 times as much as in 1980.
-We consumed more than twice as much high fructose corn syrup per person as in 1980 and remained the fattest inhabitants of the planet, although Mexicans, Australians, Greeks, New Zealanders and Britons are not too far behind.

-Americans bought more than 2 billion pairs of shoes in 2004.
-Americans spent more of their lives than ever — about eight-and-a-half hours a day — watching television, using computers, listening to the radio, going to the movies or reading.

-6 percent of men and 11.2 percent of women say they have had same-sex sexual contacts

-The floor space in new private one-family homes has expanded to 2,227 square feet in 2005 from 1,905 square feet in 1990.
-More than 24 percent of Americans in their 70s are shorter than 5-foot-6. Only 10 percent of people in their 20s are.
-More people are injured by wheelchairs than by lawnmowers, the abstract reports. Bicycles are involved in more accidents than any other consumer product, but beds rank a close second.

-With medical costs rising, more people said they pray for their health than invest in every form of alternative medicine or therapy combined.



-Adolescents and adults now spend, on average, more than 64 days a year watching television, 41 days listening to the radio and a little over a week using the Internet. Among adults, 97 million Internet users sought news online last year, 92 million bought a product, 91 million made a travel reservation, 16 million used a social or professional networking site and 13 million created a blog.

“The demand for information and entertainment seems almost insatiable,” said James P. Rutherfurd, executive vice president of Veronis Suhler Stevenson, the media investment firm whose research the Census Bureau cited.

Mr. Rutherfurd said time spent with such media increased to 3,543 hours last year from 3,340 hours in 2000, and is projected to rise to 3,620 hours in 2010. The time spent within each category varied, with less on broadcast television (down to 679 hours in 2005 from 793 hours in 2000) and on reading in general, and more using the Internet (up to 183 hours from 104 hours) and on cable and satellite television.

-Since 2000 the number of hobby and athletic nonprofit associations has risen while the number of labor unions, fraternities and fan clubs has declined.
-More Americans were born in 2004 than in any years except 1960 and 1990. Meanwhile, the national divorce rate, 3.7 divorces per 1,000 people, was the lowest since 1970. Among the states, Nevada still claims the highest divorce rate, which slipped to 6.4 per 1,000 in 2004 from 11.4 per 1,000 in 1990, just ahead of Arkansas’s rate.

-From 2000 to 2005, the number of manufacturing jobs declined nearly 18 percent. Virtually every job category registered decreases except pharmaceuticals. Employment in textile mills fell by 42 percent. The job projected to grow the fastest by 2014 is home health aide.

-One thing Americans produce more of is solid waste — 4.4 pounds per day, up from 3.7 pounds in 1980.

-More than half of American households owned stocks and mutual funds in 2005. The 91 million individuals in those households had a median age of 51 and a median household income of $65,000.
-That might help explain a shift in what college freshmen described as their primary personal objectives. In 1970, 79 percent said their goal was developing a meaningful philosophy of life. By 2005, 75 percent said their primary objective was to be financially very well off.

-Among graduate students, 27 percent had at least one foreign-born parent. The number of foreign students from India enrolled in American colleges soared to 80,000 in 2005 from 10,000 in 1976.
-As recently as 1980, only 12 percent of doctors were women; by 2004, 27 percent were.
-In 1970, 33,000 men and 2,000 women earned professional degrees; in 2004, the numbers were 42,000 men and 41,000 women.

Web 2.0: Spokeo

Web 2.0 upstart Spokeo aggregates all your social media identities into one simple(r) interface. MySpace, Blogger, LiveJournal, Flickr, Youtube, and 20 other social networks so far. It also allows members to track friends' blogs, photos, and videos in a constantly updated "news stream".

AKI COMMENT: These guys started Spokeo as a student project at Stanford. Good idea. Good start. Presumably, other missing networks will be made accessible soon, such as LinkedIn, Ziki, Slideshare, Grouper, Jumpcut...sigh, does it ever end? Hell, consider adding Second Life also, fellas. Will keep eyes out on the progress.

Talking Teen in the UK- Fewer words but more diverse.

Teenagers use just 20 words for a third of their speech, according to a new study by Lancaster University.

Interesting, but not entirely surprising. - Probably partly down to the fact that big chunks of what we say is not about imparting meaning but rather just reaffirming social patterns and structures (from saying hello to complaining about the weather / the traffic / school etc).

On an aside a fantastic book by ethnographer Kate Fox called Watching the English looks at this kind of thing (though not from the teen angle specifically) while dissecting English habits and customs most entertainingly.

But back to teen slang, and more interesting to me is that while teens are using few words, slang is becoming more divergent from mainstream modes of English. Some forms are now regarded as genuinely unique dialects by researchers, where as in the past they were just modes of speech - ie not (nearly) sufficiently different to be a dialect. Good article and a bunch of definitions in The Independent here.

Anyway you can test yourself on your brit-teen slang on BBC News here.

Academics: Get a Bachelors of Innovation

Building off the increasing attention being given to innovation in the business world, the University of Colorado announced that it is building a new family of degrees in Innovation in order to start preparing students for careers that require innovative solutions and creative thinking to solve complex problems. The program will combine law, business, entrepreneurship and engineering components (the Innovation Core) in order to give students the most well-rounded approach to innovation as it applies to the real world. Students will work on projects for partner corporations and put their academic skills to the test for companies facing complex problems.

This is a damn cool idea. If properly executed, I think this has the potential to give students a great, broad education in how to approach business issues in an innovative nature. Aki and I have discussed how many companies, particularly more traditional ones, view the very word "innovation" as resulting in some sort Star-Trek, wild-eyed idea with no foundation in their business reality. A focused academic program in innovation could help to reshape corporate America's thinking on the topic and get them to realize that the small, incremental changes businesses make in order to separate themselves from their competitive set (such as Bank of America's wildly successful Keep the Change program, which has netted +2.5 million new consumers in just over a year) are just as- if not more- innovative than any "game changing", blue-sky idea. I would imagine that, given corporations hesitation for new things (even non-traditional academic degrees) this may get off to a slow start, but I think the potential could be great if done properly. Bachelors of Innovation-- there's a phrase that jumps off a resume.

Calculating the ROI of Second Life

Ilya Vedrashko of MIT Advertising Lab blog, and Hill Holiday posted this insightful presentation "Calculating the ROI of Second Life"



via MIT Advertising Lab

Last minute shopping: Left Behind Eternal Forces

If, like me, you're looking for last minute presents for the devout(s) in your life, you probably can't go wrong with the new video game from (the aptly named) Left Behind Games. Eternal Forces is a game in which "players must either convert or kill non-Christians." The website claims that AOL.COM believes it has: "a positive moral message." However, according to a story in the SF Chronicle, others, including some "liberal and progressive Christian groups," aren't so sure.

Apparently the game's creator sees this as a pacifist game, although all the baddies have Muslim sounding names and you earn points by mowing them down. Wal-Mart is carrying it and refuses to pull it off the shelves.

Murray: I've ordered a copy for you already.

Via Slashdot

Most Impacting Trend of 2006 (and 2007)

Fallon Planners (and co-conspirators) were asked to share their single most impacting trend of 2006. What most impacted how you perform your daily tasks as a planner?

And a few brave ones even looked into their Magic 8-Ball to predict the most impacting trend of 2007.


SETH GAFFNEY, Account Planner, Fallon

PEOPLE, PLEASE

Brands are people with MySpace pages, friends, blogs, and most importantly "real" voices. They are run by people, their consumers are people (not consumers), and thus they are human. We can celebrate their failure (see BusinessWeek feature), talk to them, call them out, and help co-create them.

El Gaffney sees in 2007... EXECUTIONAL PLANNERS. "YouTube that shiznit!" isn't good enough. Brands that embrace complexity and do things look to creating multiple stories (even around their own communications - I've noticed a huge increase in "Making Of/Behind The Scenes" videos for our own campaigns) need a better plan of how to implement. "We'll put the Behind the Scenes on our website" isn't good enough. Moving this way is scary and means there's more to do. Clients will pull a Tim Gunn/Rod Tidwell combo - Make it work and show me the money. It will be up to us to provide the insights, roadmaps, and metrics for optimizing each piece.


ADRIAN HO, Director of Account Planning, Fallon

EVERYDAY POST-MODERNISM

Cut and paste, mashup and remix of social and cultural concepts. Starting with my BlackBerry which really allowed for the dissolution of the work life barrier and ending with Audi. These themes featured heavily in my client strategies and the context that I applied to my brands.

Adrian sees in 2007... POST-MODERNIST BRANDS. More brands will begin understand that they need to break themselves apart and allow for their customers to pick and choose and remix the parts of the brand that they want instead of having to swallow the story whole.


SARAH SALINE, Assistant Account Planner, Fallon

MAINSTREAMING OF PODCASTING

Not just for techies. Increasing numbers of corporations, people and organizations post podcasts are fueling a diversity of knowledge. It's finally becoming more than a cool new technology that is absorbed and thrown away. In 2006, I started to develop a library of sorts. I like them better than traditional news articles because there is no paper clutter (a serious problem for me) and they can be arranged into categories on my playlist. Reviewing podcasts is now becoming a reliable search tool for me.


RITCHIE EMSLIE, Planning Director, Fallon

I REALLY WASN'T PAYING ATTENTION

However, Ritchie sees in 2007... Obsession with celebrity, religion and ethics, gender and age roles, individualism, the meaning of balance, luxury, digitalization, the environment. This explains our love or hate or love-hate for: Paris Hilton, Richard Dawkins, Bratz dolls, George W. Bush, Blackberries, prefab housing, iTv, Al Gore.


ADAM CHORNEY, Connection Planner, Fallon

RISE OF THE IDEA / FALL OF THE AD

Ads came second to ideas. People are finally starting to realize that making the ads is the easy part. Along with this, connection planning and account planning are becoming largely indistinguishable. Kind of like having an art director and a copywriter on a creative team - one's good at drawing, the other's good at writing, but they're both responsible for the idea.

Adam sees in 2007...WHO THE F*#K KNOWS!? That's what so awesome about our world right now (if you're the type who isn't scared shitless by it all). We're gonna have to stay flexible so we're ready when the next big thing changes everything all over again.


AKI SPICER, Planning Director, Fallon

HIVE MIND

Harnessing the power of a departmental hive mind has been my own preoccupation thru 2006. Blogs became a liberating tool that interlinks creatives, AEs, even clients into the same feed of planning thoughts, trends, videos, statistics. It has become an extension of the face-to-face meeting, a virtual roundtable. It has fueled my own ability to 'think out loud' and it's made information distribution faster than developing a full powerpoint deck. And it has forced a drive towards personal action in a job that can get very bogged down in esoterics and abstract theory ("stop overthinking it and do something, post a blog entry").

Aki sees in 2007... PRACTICAL APPLICATION OF THE HIVE MIND. I expect increased collaboration in multiple dimensions - driven by wikiality, video, audio, etc as technology continues to get cheap and accessible. Assimilation into this Hive Mindedness will fuel departmental thought-efficiencies and wring value from our diverse experiences and individual voices. It all speeds up, we get past this awkward 'gee-whiz' phase, and we soon get on with saying something truly important.


AVIN NARASIMHAN, Account Executive, Fallon

SOCIAL MEDIA AS A REVENUE STREAM

As the Internet speeds toward interaction, community, and social interaction, social networks reveal huge ad revenue from big biz. MySpace, Facebook have both inked deals with big advertisers. The latter even uses its specific features (news feed, student groups, etc) to allow advertisers to offer targeted messaging to students based on the pages they look at, groups they're in, interests they have, etc. Facebook also was in talks with Microsoft this year. I saw my traditional client begin to recognize the power of social media-- getting buzz generated in the world of social media can be key in integrating ad campaigns into pop culture, and many businesses have started using mediums like YouTube and MySpace as campaign launchers.

Avin sees in 2007... BUSINESSES WILL HARNESS THE POWER OF VIRTUAL WORLDS. Like kids in grade school, businesses are falling in line with their peers and jumping on the virtual world bandwagon, many times with good ideas but not necessarily clear evidence of how it will impact the bottom line. Through hits and misses in the competitive radar, businesses will start to learn how to harness the power of communities like Second Life, and start accomplishing their goals of A) upping their brand cool/buzz factor; and B) creating bottom-line impact that justifies the expenditure of entering and "living" in these virtual worlds. 2006 saw a patently tradional bank get down with Second Life-- pending results (ie brand buzz, recall and recognition, awareness) I'll be interested to see the reaction of others both in the financial world and outside.


PAUL SANDERS, Interactive Producer, Fallon

SOCIAL NETWORKING

The critical mass that social networks achieved impacted us web people most. I'd also say that we've learned (or relearned) that connectivity without purpose is only novelty.

This sets up my pick for 2007...I foresee MORE PURPOSE BASED INTERACTIONS that extend connection to collaboration at the brand level. The consumer-generated Super Bowl spot is just the beginning. Collaborative networks will unleash new brand dynamics. We've only scratched the surface of the possibilities on this front.


KATIE COOK, Account Planner, Fallon

GOING GREEN

This year many companies jumped on the “going green” bandwagon, providing consumers environmentally friendly alternatives such as energy efficient cars (SUVs) and bamboo flooring. My parent’s recently had a deck built out of recycled egg cartons!!! Companies aren’t just providing products, they are also practicing “going green.” Wal-Mart recently opened an experimental store in Texas to study environmental efforts such as heating stores with used cooking and motor oil., while Cargill used meat scraps to make methane and replace high-cost natural gas.

Katie sees in 2007... To Adam's comment, WHO THE F*#K KNOWS!?


MURRAY HARDIE, Group Planning Director, Fallon

ATHEISM RISING

Atheists go mainstream and start sticking up for themselves at last - perhaps there's hope for mankind afterall.


Deborah Zavitka, Senior Planning Coordinator, Fallon

QUANTUM PHYSICS

Belief in the world of possibilities and the power of thought. Lives built by the stories one chooses to create rather than by the addictions that keep one frozen and enslaved; for example, fear.

Deborah sees in 2007... LOVE AND GRATITUDE WATER for drinking, and COLORPUNCTURE therapy for all.

Beyond 2007... Walk through time rather than walk on the moon.


ALYSON HELLER, Assistant Account Planner, Fallon

ENVIRALMENTS

def. Places or environments created for a brand that are so compelling that those who experience them want to share the experience with others. Usually located online, but may also be found in the real world. E.g., Joga Bonito, advertising in Times Square.

Social media went mainstream and content was king, prompting us to explore new ways to engage and entice consumers. We sought to create places - enviralments - that would contribute to social media offerings and be passed along like the viral videos/sites of yore. Unlike viral, enviralments invite longer-term interaction (create a profile or post to Flickr vs. simply watching a funny video). Enviralments at their best fit under Adrian's "surprise and delight" theory of brands.

Alyson sees in 2007... MANTRAPRENEURISM. def. The movement for companies to have a sense of purpose beyond profits. The act of incorporating social responsibility into the business model, wherein the interests of both corporate shareholders and community stakeholders are jointly considered before taking action. Famous mantrapreneurial organizations: Patagonia, (RED), and Whole Foods.

As people react against corporate control, companies will need to shift their roles in communities. Sure, profit will be a primary motivator but we are looking to connect with and later support others who are doing good in the world. Sustainability concerns - environmental, social, economic - will have to be fully integrated; piecemeal charity efforts will no longer be enough. We want to feel like we're giving back, even when we're just getting our daily caffeine fix.