Retail Surveys
|
|
|
Holiday study: Emotion matters as rich spend less
By Teresa Novellino
October 08, 2009
New York--Affluent and wealthy American families are less worried about money and more optimistic about the future, but they'll still downsize their holiday gift budgets this year, choosing to buy items that hold meaning, according to a study released on Thursday.
Overall holiday gift purchasing is projected to decline by as much as 15 percent this year among the affluent and wealthy families that make up the top 10 percent of the U.S. household economic spectrum, according to the "Survey of Affluence and Wealth in America," released on Thursday by American Express Publishing and the Harrison Group. The drop is due, in part, to the fact that there are fewer wealthy families out there: More than 1 million once-affluent families exited the category as a result of the recession, with the total number of affluent American households falling from about 11.7 million in 2008 to 10.6 million this year.
Still there are signs that the economic fears that pervaded the results of similar surveys earlier this year are fading: Nearly eight in 10 respondents said they feel 2010 will be better than 2009, 62 percent said they believe the end of the recession is less than a year ahead and 80 percent are projecting they will have a great 2009 holiday season.
The authors of the study--which tracks the mindset, habits and behaviors of the most affluent Americans--say there is a discernible difference in the way the group is behaving as consumers, and they suggest the more careful spending habits reflect a return to middle-class values.
"Happiness at the family level is up 20 percent," said Jim Taylor, vice chairman of strategic-research consulting firm Harrison Group during a presentation of the results at Time Inc. headquarters. "They're learning to deal on a needs basis rather than a want basis."
The research suggests that families are discussing their spending habits more and are happier for it, because their relationships have improved, he said.
In terms of holiday gift spending, 70 percent reported they would spend the same as they did last year, 7 percent will spend more and 21 percent will spend less, with 2 percent remaining unsure, according to the survey.
Overall, spending on a per-family basis this holiday season will decrease by 5 percent to an average $2,100, versus $2,275 in 2008. Overall spending for the affluent sector this holiday is expected to decline from $22 billion to $18.6 billion, with those in the upper-middle-class affluent category expected to spend a total of 11.7 billion this year versus $12.9 million in 2008, and those in the super affluent/wealthy category expected to spend $6.9 billion this year versus $9.1 billion in 2008.
Asked specifically about jewelry spending this holiday season, Taylor says the research indicates there will be a bit of a bubble in high-quality gifts, including fine jewelry, but the category remains a tough sell into 2010.
"We think next year is going to be very difficult except in high-quality jewelry," Taylor told National Jeweler. "The trend is toward supporting jewelry that does not decline in value when you walk out the door."
He suggests that certain types of jewelry, such as flawless diamonds, will remain in demand because of their intrinsic value, but that trend-driven jewelry will not fare as well.
"Most significant jewelry purchases are going to be related to the desire to mark time," he said, citing occasions such as birthdays or anniversaries as opportunities for jewelers looking to sell gifts imbued with meaning--even if the gift is as simple as an 18-karat gold charm or a strand of pearls for a 16-year-old girl's birthday.
Jewelry came in sixth on the list of the top 12 holiday gifts planned for 2009, the survey found. Apparel leads the list, chosen by 44 percent of respondents, dining out was the second top choice at 41 percent and home entertainment/electronics was selected by 40 percent. The remaining top gifts are as follows: children's clothing, 36 percent; accessories, 31 percent; jewelry, 25 percent; fine wines, 24 percent; sporting equipment, 23 percent; gourmet foods, 22 percent; fragrances, 21 percent; sporting attire, 21 percent; and travel/vacation, 20 percent.
Jewelry also held the sixth spot on the holiday "dream list" of what survey-takers wanted for the holiday, cited by 14 percent. A gift certificate to a favorite retailer led the list with 26 percent, a book or video was second at 20 percent and electronic entertainment equipment was third at 19 percent. Rounding out the list of items that ranked above jewelry on the dream list was a vacation in a spa or resort destination, which was the top choice of 17 percent of those surveyed, and a new laptop computer, which was chosen by 15 percent.
A return to normal spending?
Regarding the overall survey, the researchers received numerous questions that revolve around the same question: "When will normal be back?" Taylor says.
"We think 'normal' will be gone for a long time, because it's done so much for people's relationships and their bank accounts," Taylor said.
Asked to respond to the question, "When the recession is over, I will go back to the way I used to shop," 40 percent said yes. Meanwhile, 69 percent agreed with the statement: "The recession has changed my spending priorities."
Half of the survey respondents said they now have less money, and 54 percent said they are "living more responsibly."
"I am planning to buy fewer gifts, but will make them more special," was cited by 61 percent, while those who planned to "splurge on a special holiday gift" for their spouse totaled 30 percent.
The survey represents the opinions of 765 families, with a minimum of $100,000 in household discretionary income (gross incomes of $150,000 and up) and an average household discretionary income of $481,000 (with a median income of $275,000). Discretionary household income is defined as gross income reduced by factors representing property assets such as mortgage and taxes.
|
|
More Retail Surveys
Paso Robles, Calif.--Eleven percent of Jewelry Consumer Opinion Council (JCOC) panel members plan to purchase fine jewelry or watches as a gift this holiday season, with 82 percent of this group believing they are either somewhat or extremely likely to do so, according to the JCOC's Pre Holiday study. Read More
|
Small multi video player located on right rail of NJN site
|
Save
E-mail
Print
Most Popular
RSS
Reprints
