Cautious About Their Own
Consumers with a household income of $100K+ aren’t immune to the happenings in Washington. From an ailing economy to the proposed healthcare reform, these consumers appear concerned about Congress’s actions. They don’t know what’s going to transpire next, and they don’t like what they see so far, according to an analysis of BIGresearch’s Consumer Intentions and Actions (N=8,000+) and American Pulse Townhall Survey (N=4,000+).
74.9% of consumers with incomes $100-149K and 66.2% of those $150K+ say voters have lost their voice in Washington. An overwhelming majority of each consumer group say Congress is not spending tax dollars wisely and use words like disappointed, bad and incompetent to describe the governing body.
They also think Congress and the President should fix the economy first (83.4% of those $100-149K and 82.8% of $150K+), rather than reform healthcare. Regarding the healthcare legislation, 61.1% and 56.6% (incomes $100-149K and $150K+, respectively) say it is too personal to be developed by Congress and the President and should reflect the will of the people.
Unsure about the economy, upper income consumers report they are less wealthy than just a year ago at this time. 54.8% of consumers with incomes of $100-149K say they feel less wealthy, compared to only 11.6% who say more. Almost half (49.3%) of consumers with incomes $150K+ say they are less wealthy, versus 22% who say more. To cope, they are becoming more practical and budget conscious, only buy clothing on sale and use coupons and buy generic brands more than they did two years ago.
HH INCOME $100-149K HH INCOME $150K+
AUG 07 AUG 09 AUG 07 AUG 09
More practical in purchases 38.5% 47.0% 31.5% 49.5%
More budget conscious 33.4% 42.6% 25.1% 44.2%
Only buy clothes on sale 15.7% 21.4% 13.7% 15.0%
Use coupons more 23.8% 29.1% 15.1% 30.8%
Buy store brand/
generic more 15.5% 23.1% 6.6% 20.1%
Source: BIGresearch, CIA-Trends
In addition to the economy and healthcare reform, many think that issues such as Cap and Trade will cause problems for the market. 36.1% of consumers with incomes $100-149K say the Cap and Trade policy will eliminate jobs, and 36.3% think it will hurt the economy. 28.3% of those with incomes $150K+ believe it will eliminate jobs and 30.2% say it will hurt the economy.
Fast-forward to the December holiday season. 34% with incomes $100-149K+ and 27.6% with incomes $150K+ plan to spend less on gifts than last year. Conversely, 2.1% ($100-149K+) and 4.8% ($150K+) plan to spend more, not exactly good news for struggling retailers.
However, there are some bright spots in the data. Even though consumer confidence for these two groups has trended down over the past two years, it has bounced up four of the last five months (although still off from August 07). It appears spending has yet to follow due to other uncertainties. For complimentary trended data (Aug07-Aug09) and charts: http://info.bigresearch.com/
Source: BIGresearch, CIA-Trends, CIA-Jul09, CIA-Aug09, American Pulse Townhall Survey-Aug09
BIGresearch is a consumer intelligence firm providing analysis of behavior in areas of products and services, retail, financial services, automotive and media. BIGresearch conducts the monthly Consumer Intentions and Actions Survey (CIA) of 8,000+ respondents and the semi-annual Simultaneous Media Survey (SIMM) of 15,000+ respondents. It also conducts the monthly American Pulse Townhall Survey of over 4,000 Americans, making it the largest and most accurate online “townhall meeting.” More information is available at http://www.bigresearch.com