The New American Consumer - Tire Review Magazine

The New American Consumer

We all know that consumers have retrenched – a lot. With job losses reaching 15 million Americans, millions more on reduced hours and pay, and everyone else scared witless, discretionary spending is almost nil, and necessary spending is done sparingly.

Most assume, though, that these spending cutbacks come primarily from lower income families. Not so, says a new study by IBM, which showed that 72% of Americans made "significant spending cuts" because of the economy.

Hardest hit are those earning $45,000 a year or less, but 59% of those making more than $100,000 cut back too.

How are the cutbacks being made? 49% shop at more stores to get the best deal, while 35% switched grocery stores because of prices. Hardest hit sector was clothing, with 38% saying they are buying less clothing and 20% opting for off brands. More than half say they’re buying less food, and 45% cut back on food they don’t cook themselves.

But while price is a major factor for 83% of respondents, 72% said that quality remains a top priority.

Long-term, the shift in shopping habits will probably linger, based on study results. As the economy improves, 45% said "better value" will remain among the most important features when shopping for food, and 36% said "lowest price overall" will stay on top. Only 8% said value will be less important, and 15% said the search for lowest price will fade.

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