As retailers are heading into the busy holiday season, the last thing they want to worry about is new consumer focus on economic conditions. Many economists believed the financial situation for consumers would improve as we moved into this fall but new research shows a drop in the number of consumers who expect local business conditions to improve in the next year. This attitude means marketers will need to get creative to generate consumer spending for the holidays.
One of the most ominous statistics in Citibank’s Economic Pulse Survey, produced by Hart Research Associates, relates to well-educated, higher-income consumers. According to the data, these consumers – who earn over $150,000 in annual household income – have a far more pessimistic view of the economy than they did in January. Their current attitude puts them more in line with consumers who do not have a college degree. And these higher-paid consumers are the ones many retailers hope will spend heavily this holiday season.
The changes consumers are making as they shop include:
- Using more coupons found in the mail, newspapers or magazines: 72%
- Substituting less expensive products for premium: 62%
- Buying food in bulk: 44%
- Looking for online special offers: 36%
In addition, more consumers say that economic conditions have permanently changed. That number now stands at 57% while in September 2010 the number was 51%.
To generate more business, marketers will need to convince consumers that they are providing the best product or service at the best value. And they’ll need to offer discounts and coupons in many places to get the attention of shoppers this holiday season.[Source: New Citibank Survey Shows Significant Shift in consumer Psychology. 31 Aug. 2011. Citibank. Web. 12 Sept. 2011]