Two recent stories caught my attention: the New York Times’ “Shift to Saving May Be Downturn’s Lasting Impact” and a report from the Pew Center “Luxury or Necessity? The Public Makes a U-Turn”.
Both highlight a potential long-term change in consumers’ behavior. The NYT article summarizes several reports indicating that Americans’ current increase in savings may outlast the recession and become permanent. The Pew Center’s report focuses on how increasing numbers of American shoppers are viewing items (microwaves, A/C, etc) previously seen as household necessities, but now are more likely to be seen as luxuries.
So what does this mean for our love affair with overconsumption? Which product categories will survive? What will happen to “mass upscale” brands like Coach, Burberry and Starbucks that depend on consumers’ willingness to spend a little extra for more status?
Well let’s see, it occurs to me that the shift might be to consuming differently. May we will opt more for experiences than that extra TV or air conditioner or the most up-to-date technology or business ideas? In any event, people will begin to assess their expenditures with a new set parameters. We are in a time of shifting standards; I know I am.
I know what you mean; I find myself walking more, and the value is health and fitness as well as financial.
Another point to consider is the age factor or more accurately, the lifestage factor. What is the likely impact of lifestage on spending vs. saving behavior?