Teen spending is beginning to improve following a period of decline. According to new research from Piper Jaffray, teen spending contracted just 1% from the Fall of 2013, compared to more substantial declines previously. Across both the upper and average income groups, teen male spending is up 4% from Fall 2013. This compares to continued mid-single digit declines among females.
Overall, the report notes that parent contribution to teen spending bounced back to the 65% of spend range, following a period of contraction. Teen unemployment remains elevated, but off of peak levels. Time priorities have shifted, showing that advanced placement courses are the norm. Year-round single sport/activities are more common, and school years are starting earlier and ending later (shortening the opportune summer employment period).
Key findings include:
- Teen males indicated they were spending more, which has historically signaled inflection in broader spending
- For the first time in the survey history, food exceeded clothing as a percentage of the teen spending. Electronics also gained in share, while furniture and fashion lost modest share
- Declines in the fashion category were most severe in accessories, down double-digits for a second cycle in a row
- 17% of teens expressed interest in an Apple iWatch, up 12% from Fall 2013, an indication of consumer appetite
- Instagram ranked as the most important social network, exceeding Twitter and Facebook for the first time in survey history
- Cable subscriptions are becoming less essential for teens at home, while online streaming is more critical. Out of home, IMAX continues growing share among teens
- Music/radio listenership has grown for Pandora and local radio, largely at the cost of MP3s and CDs
Influences remain consistent, with friends dominating both upper income and average income, followed by the Internet, says the report. The Internet first displaced television as the No. 2 influencer with teens in the Fall 2010 survey, and the report indicates that this uptrend will likely continue as social networking and online shopping drive teens online. Instagram and Twitter are the two most used social media sites, as teens are increasingly visual and sound bite communicators.
The teen food category represents restaurants and dining out. The study uncovered a modest increase in spending devoted to events (including concerts, festivals, etc.). Within the fashion category, clothing increased modestly at the expense of footwear and accessories.
Additional survey findings:
- Shopping frequency has declined from a peak rate of 38 trips/year to 29 trips/year (one every 1.75 weeks). Fall 2013 appears to have marked the low point at 28 trips. Teens are browsing more often via their mobile devices, shopping with purpose (conversion rates are up), buying when they have a real or perceived need, and visiting the mall less for entertainment value.
- Teens prefer off-price venues to traditional department stores for their fashion needs, and are increasingly shopping online and on their phones. When asked about preferences between shopping in store and online, about three-quarters of the females polled prefer stores over sites, but the males are closer to a fifty-fifty split.
- Across both upper income and average income sub-sets, the top five preferred clothing brands were consistent to the prior year and prior season. There is evidence of growth in areas of streetwear, urban and culturally inspired trends. And an increasingly active teen is prompting growing demand for performance athletic brands.
According to Ad-ology Research, parents of teenagers are more likely than the average consumer to check-in or post their location from a store/business, subscribe to a brand's RSS newsfeed, and have a widget from the brand on their desktop or Facebook page. Television ads, followed by Internet banner ads and newspaper ads (print, online, mobile or tablet) are the most popular forms of advertising with this audience.
AudienceSCAN data is available as part of a subscription to Ad-ology PRO. Media companies can access AudienceSCAN data through the Audience Intelligence Reports in AdMall.