Frugality May Be Here To Stay

Can marketers expect consumer demand to tick up now that the recession is abating? Not exactly – according to Nielsen Claritas. Over 2/3’s of consumers still have a very conservative outlook about shopping for goods and 1215579_saleservices they want and need.

Nielsen’s analysts base their prediction on the results of the survey in which they asked, “At this moment the time to buy the thing you want and need is: ” and consumers responded as follows:

  • Excellent: 3%
  • Good: 23%
  • Not so good 44%
  • Bad: 27%
  • Not sure: 3%

To understand the source of consumer concerns, Nielsen analysts asked survey respondents to  indicate their level of worry about specific financial assets. Here’s a summary of the answers:

  • Safety of retirement portfolio: 47%
  • Stock portfolio: 41%
  • Savings account: 33%
  • Mortgage/​home value: 35%
  • Employment/​job stability: 34%

More consumers worried about these specific financial factors in 2009 than in 2008. In addition, consumers indicate that they will change their financial management practices going forward. Specifically, 30% will use less credit card debt and another 5% will consolidate debt.  The good news, according to Nielsen findings, is that only about ¼ of the U.S. population has an extreme concern about the generally economy, down from 1/​3 in 2008. The bad news is consumers plan to be personally more responsible with their finances and for many, that means spending less in the long term.

[Source: Consumer Sentiment, Nielsen, October 2009] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.