The upward tick in November retail sales is just the beginning of a spending rebound, if consumers follow through with their intentions expressed in a consumer survey conducted this month by Market Force Information Inc., a worldwide leader in customer intelligence solutions. Market Force surveyed its network of 300,000 independent mystery shoppers and merchandisers—consumers across the country known as “The Force”—to understand what is in store for 2010. More than 3,000 responded to a series of questions, revealing surprising details about their spending intentions.
When asked if they plan on splurging on an item in the next three months, 65% said yes.
What do these consumers say they will splurge on? Topping the list are electronics, travel and apparel.
Splurge items ranked by popularity:
- TV/Blu-ray/DVD/Accessories 14.74%
- Travel/Vacation 13.89%
- Computer/Accessories 11.49%
- Apparel/Shoes/Purse/Jewelry 9.60%
- Entertainment/Video Games/Music 6.20%
- Car/Accessories 5.30%
- Furniture 5.25%
- Home Improvement 5.15%
Equally heartening was their response to the question, “Will you watch every penny in 2010, relax the purse strings a bit, or spend more freely on the things you want?” While 1 in 4 consumers responded that they would relax the purse strings a bit more and/or spend more freely, that figure jumped to one-third of consumers when asked to guess what their friends and neighbors will do (as shown in Graph 1).
This disparity is often an early sign of an attitude shift. In today’s climate when being frugal is considered an important personal attribute, consumers are not inclined to tell strangers that they plan to splurge or increase their spending. But, if consumers are asked what they think their friends or neighbors will do, they have no such restraint. This question can often indicate likely behavior as attitudes begin to shift.
But, there was still a noted caution in all of the consumer responses. Just as two-thirds of consumers said they were likely to splurge, that same percentage said they were also planning on cutting back in one or more areas—focusing their spending on things that they really want. The areas mentioned most frequently for cutbacks included dining out (32%), apparel/shoes/accessories (11%), non-necessities (10%), food/groceries (7%) and entertainment (7%).
What is striking about this finding, according to Market Force analysts, is that clothing/accessories was targeted by almost equal numbers of consumers for both splurging and cutting back. This sign of conflict likely arises between the desire to buy that “one special item” and the overall commitment to not buy things unless they really, really have to. So, consumers will continue to be cautious. But items that really catch their fancy this year are more likely to be coming home with them.
The survey was conducted in early December 2009 among the Market Force network of more than 300,000 consumers. The pool of 3,000 respondents ranged in age from 19 –72, and reflected a broad spectrum of income levels; approximately half have incomes of more than $50,000 a year. Approximately 75% were women, which are the primary household consumer purchasers. Half have children at home.
About Market Force Information
Market Force Information Inc. is the leading global customer intelligence solutions company for multi-location businesses including major retailers, restaurants, grocery and convenience stores, financial institutions, entertainment studios and consumer packaged goods companies. With more than 120 years of combined industry experience, Market Force Information has pioneered the industry with a suite of customer intelligence solutions – from 300,000 field associates, to real customer surveys, to proprietary decision support tools – that provides a holistic view of the customer’s on-site experience and identifies the actions required at the store level to increase customer loyalty and improve financial performance. For more information, please visit: www.marketforce.com and follow us on Twitter @MarketForce.