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It should come as little surprise that consumer spending was down in March, the fourth straight month in a row that shoppers reeled in their purchases and held onto their wallets. And if a Boston Consulting Group study released today is any indication, that’s unlikely to change anytime soon. Seventy-three percent of Americans said they planned to cut back on spending in the next 12 months, more than in any other country the strategy consultancy surveyed. In China, meanwhile, just 26% of consumers are likely to trim what they spend.
The survey dove into other consumer sentiments, from how worried employed folks are about keeping their jobs to which direction consumers feel the economy is headed. Just 20% of U.S. respondents felt we’ve hit bottom, with only Japanese respondents (11%) feeling less optimistic.
But the most interesting results showed how consumers’ shopping habits are likely to change as a result of the recession. In the U.S., hypermarkets and discount retailers should gain market share from grocery shoppers. Meanwhile, on a list of spending categories consumers would cut, vacation and travel are the first thing to go in all developing markets. Restaurants and fast food are first in the U.S. (vacation showed up fifth on the list of categories consumers would cut) while fashion accessories were the first thing Europeans would give up (with travel showing up even lower, at sixth).
Also fascinating: Brands look to be meaning less and less for consumers in the U.S., Europe and Japan. Just 27% of Americans and 15% of Japanese said they’re willing to trade up for a better brand, while it was the top reason in India and China, where 79% and 71% of consumers said brands would make them spend more, respectively.
The good news for retailers, if there are any? Consumers were asked if they think frugal lifestyles will last, even after the recession ends. Most were neutral on the issue, with Europeans saying that indeed, they will resume spending as ever before.
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