The ‘Predictable’ Consumer
The only most certain forecast for the upcoming back-to-school and holiday selling seasons is unpredictability.
An article in the Minneapolis-St. Paul Star Tribune headlined “The unpredictable consumer” suggested that “a potent combination of factors has dampened consumer spending and thrown retailers’ best-laid strategies into confusion.”
The latest BIGresearch study suggests that women, in particular, may be spending less than previously. The survey contends that many consumers are confused. They wonder why they are feeling bad when the experts say they should be elated.
Folks on Main Street USA, where 70 percent of the economic activity takes place, may not feel the impact of the booming stock market or know the current price of a barrel of oil. They do, however, see that high gas prices and rising grocery bills are eating into their disposable income.
Only 39.9 percent of those responding to the BIGresearch survey felt that the stock market was an accurate indicator of the economy.
Nearly 73 percent said that gas prices would continue to climb. Increased demand for corn-based ethanol products has driven up prices on almost all staple food products since corn is used in everything from ketchup to breakfast cereal. As a result, consumers are planning fewer shopping trips and buying at stores closer to home.
The good news is that compared to the May study, the June report showed that the intent for consumers to purchase durable goods like furniture, appliances, TVs, digital cameras and even housing has risen. The study indicates that customers may have some pent up demand for the products you sell.
The more disturbing news is that although consumers continue to outspend last year, many are buying only when things are heavily discounted. Over Memorial Day weekend, for instance, 80 percent of consumers surveyed by America’s Research Group said that were only buying sale items compared to 27 percent who were discount shopping a year ago.