SAGE ADVICE: Holiday Spending Still Not Over
Posted: 2/1/2008 | By: Erik A. Shapiro
No surprise to retailers, our Leo J. Shapiro & Associates national consumer surveys find the percent of consumers reporting they spent less for Christmas this year than last stands at 53 percent in 2008, compared with 43 percent in 2007.
What might be a little surprising to retailers is that the Christmas shopping season is not yet over. Newspapers should encourage retailers to continue advertising in January and February to reach the one in four consumers (26%) with unredeemed gift cars who will not complete their Christmas shopping until the end of February.
And, now for an ugly surprise: Consumer tracking data confirm that cutbacks in consumer spending during Christmas are a mild taste of spending cut backs to come. Stagflation ? the combination of falling incomes and rising prices ? continues to lumber towards us.
Between December and January, the percent of consumers who spontaneously mention recession as a major problem for the nation jumps to 30 percent from 20 percent. The U.S. government promised to pump $150 billion into the economy to stave off recession. The move to stave off recession lays the groundwork for the resumption in the surge of inflation, one half of the recipe for stagflation.
In recessions, and especially in stagflations, consumers look desperately for ways to bolster their buying power. Newspapers can come to the consumer rescue. Our January LJS survey finds the percent of consumers trying to cut back on food spending ticks up a point to a new two-year high of 51 percent in January.
The survey also find that majorities of consumers say they are trying to cut spending for food by using coupons (57%); reading newspapers to find bargain prices (57%); buying more private label products (52%); and stocking up at membership warehouse stores (34%).
The Bottom Line
There is no question about the value of newspapers to readers and to advertisers being enhanced in time of recession and stagflation.
Newspapers would be wise to let their retailer partners know about the importance to consumers of the script they find in the paper which can be spent where they are likely to shop.
Printing coupons is like minting money. With limited convertibility, the value of coupons depends on the variety and desirability of the products they can be used to buy. In this time of stress, it might pay to issue coupons that encourage cross-shopping between products and stores.
Coupons minted by newspapers help merchants move the mix of merchandise they most want to move. The newspaper?s reputation as a source of news about where to get bargain prices builds the size and attentiveness of audiences.
What might be a little surprising to retailers is that the Christmas shopping season is not yet over. Newspapers should encourage retailers to continue advertising in January and February to reach the one in four consumers (26%) with unredeemed gift cars who will not complete their Christmas shopping until the end of February.
And, now for an ugly surprise: Consumer tracking data confirm that cutbacks in consumer spending during Christmas are a mild taste of spending cut backs to come. Stagflation ? the combination of falling incomes and rising prices ? continues to lumber towards us.
Between December and January, the percent of consumers who spontaneously mention recession as a major problem for the nation jumps to 30 percent from 20 percent. The U.S. government promised to pump $150 billion into the economy to stave off recession. The move to stave off recession lays the groundwork for the resumption in the surge of inflation, one half of the recipe for stagflation.
In recessions, and especially in stagflations, consumers look desperately for ways to bolster their buying power. Newspapers can come to the consumer rescue. Our January LJS survey finds the percent of consumers trying to cut back on food spending ticks up a point to a new two-year high of 51 percent in January.
The survey also find that majorities of consumers say they are trying to cut spending for food by using coupons (57%); reading newspapers to find bargain prices (57%); buying more private label products (52%); and stocking up at membership warehouse stores (34%).
The Bottom Line
There is no question about the value of newspapers to readers and to advertisers being enhanced in time of recession and stagflation.
Newspapers would be wise to let their retailer partners know about the importance to consumers of the script they find in the paper which can be spent where they are likely to shop.
Printing coupons is like minting money. With limited convertibility, the value of coupons depends on the variety and desirability of the products they can be used to buy. In this time of stress, it might pay to issue coupons that encourage cross-shopping between products and stores.
Coupons minted by newspapers help merchants move the mix of merchandise they most want to move. The newspaper?s reputation as a source of news about where to get bargain prices builds the size and attentiveness of audiences.