April 5, 2015
Yesterday’s hot trend, tomorrow’s buyer’s remorse.
Is this the year you’ll cut the cord?
1. Cable TV
Though cable providers still have plenty of subscribers — roughly 101.7 million Americans, in 2014, according to research firm IBISWorld — those numbers are declining. The firm predicts that cable providers will lose a net of around one million subscribers for each of the next several years, reaching 97 million in 2019.
One of the reasons for this subscriber defection: Consumers are increasingly embracing (often cheaper) cable alternatives. Indeed, PricewaterhouseCoopers notes that subscriptions to cable alternatives like Netflix (up 25% over 2013), Amazon Prime (up 14%) and Hulu (up 3%)—each of which costs around $8 a month—are on the rise.
You may have more reason than ever to cut the cord, as cable TV rates are rising, even as more relatively inexpensive streaming options emerge. In 2015, research group NPD expects the average pay-TV bill (for basic and premium channels) will hit $123 a month, up from $86 in 2011.
What’s more, in 2015, there will be even more streaming options to watch: In October, HBO, Univision and CBS all announced new stand-alone streaming services. “There are a lot more options out there so we don’t all have to subscribe to cable anymore,” says Sarah Kahn, an industry analyst for IBISWorld. — Catey Hill
2. Name-brand razorblades
Americans love their Gillette razorblades — so much so that the shaving giant controls 66% of the nearly $13 billion shaving industry. But just because Gillette is popular doesn’t mean it’s cheap, especially if you’re buying the blades (or cartridges, to be exact) at the corner drugstore.
Which is why more shavers are turning to membership programs; the Dollar Shave Club, whose membership has grown by nearly 200% in the past year to 1.3 million, is perhaps the most prominent example. Such clubs sell blades on a mail-order subscription basis for a fraction of the cost. A blade purchased through Dollar Shave can run as little as $1.50; by contrast, a Gillette blade can run as much as $5. And the blades aren’t necessarily inferior: A survey by the grooming-oriented Sharpologist website gave high marks to just about every low-cost Gillette competitor.
Still, what if a shaver swears by Gillette? Gillette and shopping experts says consumers can still find ways to save on their beloved blades by buying them at discount retailers (Costco is an oft-mentioned example) or creating what amounts to their own subscription model–meaning purchasing the brand-name blades in larger quantities on a recurring basis through sites like Amazon.com and Drugstore.com. — Charles Passy
3. Bottled water
This cart doesn’t need to be this full.
Who would pay $2 for a what amounts to a bottle of tap water? Millions of Americans, it turns out. In the four decades since Perrier water was launched in the U.S. market in the mid-1970s, U.S. consumption of bottled water has surged 2,700%, to 10.1 billion gallons in 2013, according to the Beverage Marketing Corporation. And sales in the U.S. rose 4% year-over-year in 2013 to $12.3 billion. The Beverage Marketing Corporation predicts that bottled water will become the top-selling packaged beverage in 2020, up from No. 2 currently.
Scares over possible water contamination have helped boost demand for bottled water over the last few decades, experts say. The American public thinks bottled water is going to be safer and cleaner than tap water, says Mae Wu, attorney in the health program at National Resources Defense Council, a nonprofit environmental advocacy group based in Washington, D.C., but “for the most part, that’s not true.”
Indeed, 45% of bottled water brands are sourced from the municipal water supply — that’s the same source as what comes out of the tap, according to Peter Gleick, a scientist and author of “Bottled and Sold: The Story Behind Our Obsession with Bottled Water.” Bottled water sourced from municipal water supplies include Dasani, owned by Coca-ColaKO, +0.00% and Aquafina, owned by PepsiCo PEP, +0.63%
Consumers can purify their own tap water for a fraction of the cost, says Nick Colas, chief market strategist at ConvergEx, a brokerage and a services firm. It’s more economical and better for the environment to filter tap water at home, “and one way to avoid using a lot of scrap plastic,” he says. Filters from companies such as Brita and Pur start at around $15 for a year’s supply. — Quentin Fottrell
4. Credit monitoring & identity theft insurance
Threats from hackers are real, but the benefits of insurance are iffy.
The year 2014 saw an almost unrelenting avalanche of security breaches that struck retailers, banks and medical providers, among many others. At least 744 data breaches have been disclosed this year, with more than 115 million consumers’ records exposed, according to the Identity Theft Resource Center.
To protect themselves and their data, consumers may opt for credit monitoring services or identity theft insurance. But such coverage, which can cost anywhere from $25 to more than $100 a year, may not be worth paying for, consumer advocates say. “It depends on how important peace of mind is to you, because that’s essentially what you’re buying at the end of the day,” says Al Pascual, senior analyst for security, risk and fraud at Javelin Strategy & Research.
Some credit monitoring services place all of a person’s financial information in one place, making it easier to check your account for fraudulent activity. These services also often help victims of identity theft get through the crisis, aiding with paperwork and potential fees or expenses like lost wages, if a person has to take off work to deal with the fallout, though such extensive cases are rare.
But you may not need that kind of help. Banks have zero liability policies that protect consumers from unauthorized charges For free, people can opt to receive alerts each time a transaction is made over a certain value; they can also ask the credit bureaus to put a security freeze on their account to prevent fraudsters from opening new lines of credit.
And if you decide you want the protection, chances are you already have multiple offers in your inbox that can give it you free—given that many breached companies extend these services to customers free of charge to save their reputations.— Priya Anand
5. DVDs and CDs
Compact discs and DVDs have going the way of the dodo, and streaming media will keep that trend going in 2015, experts say. Sales of DVDs and high-definition Blu-ray discs dropped by 8% to $7.78 billion last year, and are expected to have fallen even further in 2014, according to Digital Entertainment Group, an industry trade group. Revenue for DVD rental subscriptions — from companies like Netflix NFLX, +0.23% and Red Box — plummeted 19% in 2013 to $1.02 billion. And while digital movie purchases are playing catch-up on DVDs, revenue still soared by 47% to $1.19 billion last year.
Digital music tracks also declined for the first time in 2013, according to Nielsen SoundScan, and that slide continued throughout 2014. On-demand streaming of music rose 42% year-over-year to 70 billion songs in the first half of 2014, while digital track sales fell 13% to 594 million in the same period. Sales of compact discs dropped by 19% year-over-year to $716 million in the first half of 2014, according to by revenue in the Recording Industry Association of America, although vinyl LP sales surged 43% to $146 million in the same period. — Quentin Fottrell
6. Memory sticks and thumb drives
Adorable, and endangered.
Computer memory sticks and thumb drives are becoming obsolete as the online storage wars heat up. Microsoft MSFT,-1.06% announced last October that it’s offering unlimited cloud storage to Office 365 subscribers (although subscriptions themselves cost $70 to $100 a year). That came shortly after Google Drive slashed storage prices for its monthly online storage plans to $1.99 from $4.99 for 100 gigabytes. Microsoft and Google GOOG, -1.30% also offer free storage under a certain gigabyte limit, and many tablets and computers also come with free storage for new buyers.
“Cloud storage costs companies so little due to economies of scale, and they get the benefit of deepening their relationship with you,” says Avram Piltch, online editorial director of Laptop Mag and Tom’s Guide. “It makes it that much harder for you to bail on them in the future, even when they eventually charge you for the space.”
Memory sticks can sometimes be cheaper than cloud storage: Their prices typically start at around $25. But they can spread viruses from computer to computer and, unlike the cloud, they can be left behind in a cafe. Of course, the cloud isn’t invulnerable, as a security breach of Apple’s iCloud system showed this fall. And some consumers fear losing access to cloud data if storage providers suffer more technological problems, or opt to raise their prices. — Quentin Fottrell
7. Mini tablets
The one on the right may lose out to the ‘phablet.’
When Apple AAPL, +0.86% launched the iPhone 6 Plus phablet in 2014, it may have harmed the sales of another one of their product lines–mini tablets. “Phones are getting bigger and better, and there is no reason to have a mini tablet,” says Howard Schaffer, vice president of retailing website Offers.com. Brent Shelton, spokesman for deal site FatWallet.com, argues that mini tables like the Samsung 005930, +3.07% Galaxy Tab 8 ($270) and iPad Mini 3 ($399 for 16 gigabytes) are becoming a “redundant technology,” especially with the introduction of the 5.5-inch iPhone 6 Plus ($299 with a two-year contract) and Samsung Galaxy Note 4 ($399 with a two-year contract).
The popularity of phablets — roughly defined as smartphones with 5.5-inch and larger screens — is causing many people to “second-guess” smaller tablet purchases as the larger screens are often adequate for tasks once reserved for tablets, says Tom Mainelli, program vice president of devices and displays at IDC. Shelton notes that consumers can make phone calls on phablets (without FaceTime or Skype) and that they’re easier to handle for taking photos. “Plus, you can put them in your coat pocket quite comfortably.” iPhone 6 Plus sales made up more than 40% of all phablet sales in the fall of 2014, according to market research firm Kantar WorldPanel ComTech, even though it didn’t debut until Sept. 19 in most countries, including the U.S. Meanwhile, people who are buying iPads appear to be turning up their noses at the 7.9-inch iPad Mini: According to a recent survey released by e-commerce firm Slice Intelligence, some 93% of iPad preorders are for the larger 9.7-inch iPad Air 2. — Quentin Fottrell. Read: Apple sales surge (except for the iPad).
8. Paid online dating services
Even online, money can’t buy you love.
Love might be priceless, but the dating industry is expected to earn $2.2 billion in revenue in 2014, according to IBISWorld. In addition to Match.com and eHarmony, the two most popular paid services, niche options abound: VeggieDate.com, FarmersOnly.com, GlutenFreeSingles.com, Meet-an-Inmate.com and even ClownDating.com. One in five 25-to-34-year-old adults has online-dated, according to Pew Research Center data and 5% of Americans in marriages or committed relationships said they met their significant other online. And Match.com and eHarmony, the two most popular paid services, charge love-seekers between $20 and $60 monthly, depending on the type of subscription.
Still, The Beatles may have been on to something when they sang that “money can’t buy me love.” Free dating apps are surging in popularity. Tinder users swipe right or left on their smartphones more than 1.4 billion times in aggregate daily, indicating interest in or rejecting potential matches. Tinder might be better known for hooking people up with flings, unlike Match and eHarmony, which advertise their algorithms as the ones that can find you a lasting relationship. But other free apps, like OkCupid, say that their matching algorithms are now competitive with those on the paid sites. Like the paid sites, OkCupid, which claimed about 10 million users in the past year, also offers basic questionnaires that allow users to rank their priorities in a potential date and match people based on compatibility. Hinge, another free app, matches users with contacts of each other’s Facebook friends to filter the pool of strangers and, hopefully, avoid psychopaths and creeps.
To be sure, paid services (and premium versions of free sites) often include more detailed compatibility questionnaires, more filtering options for candidates or anonymous browsing of profiles, and could weed out daters who are just looking for a quick fling. “Do you like expensive restaurants, or do you feel like you can get a great meal at a cheaper restaurant that’s well-chosen?” says Dan Slater, author of “Love in the Time of Algorithms: What Technology Does to Meeting and Mating.” “Whether or not you pay, it’s always going to be hard to find someone you have that spark with.” — Priya Anand
9. Boutique moonshine
Don’t let white lightnin’ strike your wallet.
In recent years, Americans have rediscovered quality whiskey: Sales of single-malt Scotch alone have grown by 134% since 2002, according to the Distilled Spirits Council of the U.S. But these days, there’s a lot of clear or “white” whiskey — meaning un-aged corn or rye whiskey — competing for space on liquor store shelves with the classic brown spirits.
Brands based everywhere from Kentucky to New York are touting what amounts to a boutique version of moonshine or white lightnin’, costing as much as $40 a bottle. The trend started to take off around 2009, particularly as states looking for ways to boost business during the Great Recession started relaxing regulations governing the production of spirits, according to one published report. Indeed, from 2010 to 2012, sales of moonshine in the U.S. quintupled to more than 250,000 cases, according to Technomic, a prominent firm that analyzes the beverage industry.
But while these new-school moonshine makers speak of estate-grown corn and proprietary recipes, some spirits experts say that consumers shouldn’t be fooled — un-aged whiskey simply lacks the depth and character that an aged one, be it a Scotch or bourbon or even a Taiwanese spirit, can attain. Basically, time in the barrel equates to more flavor. “I’ve never had a white whiskey that I would say I prefer to an aged whiskey,” says Clay Risen, author of “American Whiskey, Bourbon & Rye,” a buying guide. — Charles Passy
10. 4K Televisions
Great for aquarium videos, but not quite ready for prime time.
With their super-sharp pictures, 4K and other ultrahigh definition (UHD) televisions are tempting for those who spend hours in front of the TV. (And, ahem, that’s most of us: The average American watches nearly three hours of TV a day, according to government estimates). But experts say that despite their perks, you shouldn’t buy these yet. For one, despite rapidly plummeting prices, 4K TVs are still quite expensive: Research firm NPD Group notes that they have an average price of $2,400, compared with about $450 for flat-screen TVs overall. Plus, there isn’t a lot of ultrahigh definition content for owners of 4K TVs to watch right now. “Realistic expectations are that content to match the display is approximately two to three years out,” says Phong Vu, CEO of deal intelligence site DealScience.com. “There’s little logic in paying a premium for a TV that consumers will rarely get to enjoy in UHD.”
To be sure, prices for 4K/UHD TVs will likely drop. Flat screens also made their debut at a high price point: Stephen Baker, the vice president of industry analysis for NPD Group, notes that a 42” flat-screen in 2006 or 2007 might have cost about $3,000, while now you can get one for $200 to $300. “The decline in the prices of flat screen televisions is due to greater manufacturing capacity that has increased supply, the entrance of low-cost manufacturers, and technological developments that have lowered production costs,” says IBISWorld analyst Darryle Ulama. With the 4K/UHD market, we might see similar forces bring prices down. — Catey Hill