NEW YORK — Americans still seem relatively unconvinced that there will be dramatic economic improvement this year, and that attitude will continue to impact shoppers’ purchasing habits, according to consumer market researchers.
“The ‘jobless’ recovery — like government bailouts — hasn’t yet touched consumers,” states a report released last month by Nielsen Co. “Banks remain skittish about extending credit. While economic indicators point to a technical recovery, a fair number of looming issues have yet to be addressed.”
The uncertainty that continues to hang over the direction of the nation’s economic fortunes will mean that much of the consumer behavior that marked 2009 will continue this year. “Either by choice or necessity, [consumers’] new-found thriftiness will continue,” the report says. “Almost one-third of consumers say they will use credit less even when conditions improve.”
Noting that Americans’ confidence has been slower to rebound than in other parts of the world, the Nielsen report lists several factors that will influence consumer goods spending trends in 2010.
The need to save money, continued high unemployment levels and other economic issues will continue to be top of mind, suggesting that a return to past consumer spending behavior may take some time.
Since there are no signs that consumers are ready to open their wallets, Nielsen stresses that marketers should move beyond pricing and seek product differentiation.
“Value messaging must include some point of differentiation beyond pricing,” the report says. “Manufacturers and retailers that drive the recession wave and take an active role in innovation and ad spending are likely to be the big winners.”
Nielsen adds that as retailers continue to try and simplify the consumer shopping experience by eliminating aisle and shelf clutter, they will have to look to forge deeper alliances with key suppliers to ensure that sales remain steady.
Meanwhile, a report from the global market intelligence firm Mintel provides a more upbeat forecast, saying that consumers are ready to reset and start fresh for 2010.
“While in 2009 fear played an important role in shaping consumer behavior, 2010 will see a return of confidence and adaptation to overcome the restraints previously imposed on consumers,” Mintel director Richard Cope says in the report, which was issued last month. “Balance has become the new mantra,” he says. “As consumers find they are able to spend again, we’ll see balanced spending and balanced consumption as key characteristics of next year.”
Still, notes Mintel, shoppers will be more cautious in how they spend their money, and the search for value and a better understanding of the products they buy will rule the day.
“Value initiatives are hot, and they’ll remain so,” the report states. “However, consumers will purchase more expensive products if they are convinced of the products’ value.
“Brands that engage consumers effectively stand to be successful despite price barriers.”
Because consumers are better educated than ever, getting them to buy these higher-priced items will require an intense effort by suppliers to prove that the products are worth the investment.
“We’ve become a society of doubters,” Mintel says. “A company’s need for accountability is nothing new, but the quantity of information available today adds to the challenge.”