By Rieva Lesonsky
With gas prices at record levels, the cost of food and other necessities on the rise and the job outlook still far from positive, perhaps it’s no wonder that BIG Research’s latest Consumer Actions & Intentions Survey shows consumer sentiment is stagnating.
Just 27.8% of more than 8,000 consumers surveyed earlier this month say they are very confident or confident in chances for a strong economy. That figure is even with May’s and lower than the same month in 2010 or 2009 surveys. More than half predict layoff levels to stay the same in the next six months, although just 3.4 percent of those with jobs are personally worried about losing them.
With their personal financial outlooks not improving, consumers are focusing on needs, not wants, when they do shop. Almost half (48.5%) say they’ve become more sensible and realistic in their purchasing, up from 44.8% in May. In fact, BIG says this is the highest June reading in the survey’s history.
Of course, one key reason for the practicality is rising pump prices. Nearly 80 percent (77.9%) say gas costs are having a major impact on their household budgets. To deal with the increase, consumers are taking fewer shopping trips (45.6%), shopping closer to home (43.4%), seeking bargains (42.8%) and using coupons more frequently (40.5%).
On the plus side, consumers apparently need a lot of things, as BIG’s 90 Day Outlook for what consumers plan to buy in the next 90 days is looking up compared to May and compared to June of 2010 and 2009. There’s one glaring exception: Consumer plans to eat out are down from a year ago. That makes sense, as dining out is typically the first area where many people cut back when times are tough.
In particular, big-ticket purchase plans are a bright spot in the survey. The percentage of consumers planning to buy cars, computers, furniture, jewelry, mobile devices,TV sets and vacation travel in the next 6 months all rose compared to a year ago—as did the percentage planning home purchases or major home improvements. However, keep in mind that fewer than 15 percent of consumers plan to buy any of these items in the next 6 months.
With summer upon us, consumers may need to prepare with seasonal clothes, furniture and other items. Use seasonal marketing to grab their dollars while you can, and emphasize practicality, usefulness and value in your marketing message.
Image by Flickr user The Consumerist (Creative Commons)
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