The Hard Facts Of Shopper Confidence, Published by WSL Marketing Inc. www.wslstrategicretail.com by Wendy Liebmann and Candace Corlett, principals

Furniture World Magazine

Economic forecasts and consumer shopping behavior continue to just miss. Why? Cautious Shoppers: The analysts predicted a robust holiday shopping season, and shoppers responded almost, but not quite. Shoppers have lived through the shop 'til you drop 1990s, and the sobering fallout when the bubble(s) burst. The hard reality of shopping life today is that no amount of upbeat economic forecasting is going to fool this group of consumers into believing what their day-to-day experience belies. Only 18 percent of women, the heartbeat of shopping life, believe the economy has improved in the last six months.Two-thirds of all shoppers are being more cautious about their spending. The economy has improved 29 percent. 18 percent in the past six months How America Shops Everyday PULSE Report is based on a national Internet survey of 1,048 consumers conducted November 4-11, 2003 ECONOMIC FORECASTS SHOPPERS' BEHAVIOR: Tough Family Finances: The percent of consumers who feel their family's finances are improving has been reduced to less than a quarter of the population. However, almost half the population has hope for next year. The Poor Feel Poorer: The weakness in holiday sales at the discount chains is explained by lower income consumers where the "recovery" has yet to arrive. Significant numbers of lower income shoppers feel less well off than middle and upper income shoppers. WHAT IT MEANS FOR YOUR BUSINESS: Accurate sales forecasts need to consider how shoppers feel as well as what the analysts predict. Don't discount how shoppers feel. With two-thirds of shoppers watching their spending, marketers must provide shoppers with the right justification to buy. The "recovery" from recession is not spread evenly across the population. The significant differences among the demographic groups will impact some categories and retailers more than others. - Women are more cautious Older shoppers are least affected by economic change Lower income shoppers are still in a recession mode - Upper and middle income shoppers are experiencing economic rebound --- but with reduced expectations