Two months down and I already have 6 postings on this subject. The most recent talk in the news this week is revolving around the word recession. I have written about what to do, how to prepare and linked and referenced articles and stories from others.
But what if it doesn’t happen?
Here’s a new report to look at as we march into month 3 of 2008 (pun intended):
Consumers Speak Out On the U.S. Economy
The NPD Group, Inc., a leading provider of consumer and retail information, announced the results of a recent “Fast Checks” study entitled: Consumers Speak Out On The U.S. Economy. According to the study’s results, most consumers think the U.S. is in a recession or headed for one.
It appears that consumers, across many retail segments, do not intend to change their behavior yet. “Even with all the media attention on the economy, consumers still seem to be focused on their needs and desires,” said Marshal Cohen, chief industry analyst, The NPD Group, Inc, “Consumers are tuned into news about our economy, but they aren’t so quick to change what they are doing, including where they shop.”
More than half of consumers surveyed said they were least likely to change spending habits on affordable purchases like books, movies, cosmetics, fragrances, or an indulgence that can pass for a necessity like footwear. Interestingly, more than one in 10 who plan to spend on home improvement plan on spending more. “Certainly the housing market is another source of concern for consumers. These results would suggest more people are looking to improve their house to spruce it up for themselves or to make it more attractive to a potential buyer.” observed Cohen.
What is the one thing that would most likely tip the balance for consumers and rein in spending? Cohen says it’s job security. “Twenty-six percent of the study’s respondents are concerned about job security. Should a real or perceived threat to U.S. consumers’ jobs come along, that will shift the dynamic and likely have the greatest real effect on our economy.”
What are the implications for retailers? Consumers will clearly be on the look-out for incentives to shop.
“I think the consumer is still going to be there, but retailers are going to have to do more to get them.” Cohen said, “Certainly promotional incentives of all kinds will be key but how you market and communicate will help seal the deal.”
(Source: The NPD Group, 2/28/08)