The American Value Shopper in a Down Economy

Table of Contents

Chapter 1 Executive Summary

• Scope of Report
• Report Methodology
• Value Shopper & Others Defined
• The Current Economic Landscape
  • Growth Slows, Economic Future Uncertain
  • Figure 1-1 Percentage Changes in U.S. Current-Dollar GDP, Real GDP and the GDP Price Index, 2002-2008 (%)
• U.S. Consumer Spending Trends and Attitudes
  • 77% Lack Confidence in Economy
  • Table 1-2 Percentage of Adults Who Responded Positively to Economy-Related Statements, Month Over Month, October 2007-April 2008 (U.S. adults)
  • Prime Consumers Are Tightening Purse Strings
  • Table 1-3 Average Household Income of Adults Who Plan to Decrease Spending, Year Over Year, April 2003-April 2008 (U.S. adults)
  • Less Educated More Dramatic, More Educated More Sensitive
  • Table 1-4 Adults Who Plan to Decrease Spending, by Level of Education Year Over Year, April 2003-April 2008 (Percent)
  • Homeowners Running Scared
  • Table 1-5 Adults Who Plan to Decrease Spending by Residential Status Year Over Year, April 2003-April 2008 (Percent)
  • Older Adults Increasingly Likely to Reduce Spending
  • Table 1-6 Adults Who Plan to Decrease Spending, by Age Range Year Over Year, April 2003-April 2008 (Percent)
• Potential Consumer Spending Shifts by Category
  • The Biggest Losing Categories are…
  • Table 1-7 U.S. Adults Who Plan to Decrease Spending in: Sporting Goods, Women' s Dress Clothing, Men' s Dress Clothing, Children' s Toys, CDs/DVDs/Videos/Books, and Various Home Goods April 2003-April 2008 (U.S. adults)
  • Retail Channel Gains in Specific Product Categories
  • Table 1-8 Selected Retail Channel Preferences by Product Category: Adults Overall, April 2003- April 2008 (U.S. adults)
  • Increased Interest in Savings May Be Boon for Internet Shopping
  • Table 1-9 Selected Retail Channel Preferences by Product Category: Adults Overall, April 2003- April 2008 (U.S. adults)
  • Retail Channel Preferences Are Eroding
  • Figure 1-10 Percentage of Adults With No Retail Channel Preference by Product Category: April 2003 vs. April 2008 (U.S. adults)
• Value Shopper Demographics
  • The Average Value Shopper: Affluent and Educated
  • The Extreme Value Shopper Splits Between Young and Old
  • Demographic Profile of Entertainment and No Interest Shoppers
• Value Shopper Attitudes
  • Value Shoppers Outgoing, Adventurous
  • All New, All The Time
  • Research…A Reward In Itself?
  • Ask Me, I Know
  • Quality Across the Board
  • Going On A Value Hunt
  • Shop for Joy
  • Brand Savvy
  • Highly Aware of Advertising
  • Image May Be Everything to XVS
  • Table 1-11 Statements Indicating Outgoing, Adventurous, and Unique Attitudes, Fall 2007 (index)
• Value Shopper Selected Retail Preferences
  • Retailer Categories: Value Shoppers Show Consistently Higher Penetration than Total Population
  • Table 1-12 Type of Retailer Shopped Last Four Weeks by Shopper Type, 2007 (%)
  • Wal-Mart Tops the List of Retailers
  • Table 1-13 Top 10 Department, Discount, Children' s Toy, Clothing and Footwear Store: Shopped Last Four Weeks by Shopper Type, 2007 (%)
  • Average Value Shoppers Get Around
  • Table 1-14 Shopping Outlet Preferences of Average Value Shoppers, 2007 (%)
  • Extreme Value Shoppers More Focused on Necessities
  • Table 1-15 Shopping Outlet Preferences of Extreme Value Shoppers, 2007 (index)
  • Entertainment and No Interest Shopper Store Preferences
• Looking Ahead
  • Higher Unemployment, Tighter Credit Likely
  • Importance of Reaching Out to All Types of Value Shoppers
  • Opportunity for Marketers to Learn and Innovate
  • Not Just About Price, but It May Seem So
  • Added Value of Sustainability Keeps Growing
  • There' s Value in Company Values
  • Coupon Use likely to Rise
  • Sampling to Boom
  • Word-of-Mouth: Added-Value for Marketers and Consumers
  • Leveraging the Internet
  • Private Labels May Be the Lucky Ones

Chapter 2 The Current Economic Landscape

• Overview
• 2008 Real GDP Growth Forecasted at a Meager 0.9%
• Figure 2-1 U.S. Current-Dollar GDP vs. Real GDP 2002-2008 (in trillion $)
• Figure 2-2 Percentage Changes in U.S. Current-Dollar GDP, Real GDP and the GDP Price Index 2002-2008 (%)
• Economic Future Uncertain
• Unemployment
• Figure 2-3 Initial Weekly Unemployment Claims, Four-Week Moving Average January 24, 1977-April 26, 2008 (in thousands)
• Figure 2-4 Average Annual Civilian Labor Force Participation Rate and Unemployment Rate 1977-2008 (percent)
• Personal Consumption Slows
• Figure 2-5 Personal Consumption Expenditures, Current-Dollar versus Real, 2000-2007 (in billions $)
• Figure 2-6 Percentage Changes in U.S. Current-Dollar PCE, Real PCE and the PCE Price Index, 2002-2008 (%)
• Consumer Prices on the Rise
• Figure 2-7 Average Annual Percent Change in the Consumer Price Index for All Items, Durable Goods, Non-Durable Goods and Services 1978-Q1, 2008 (percent)
• Food Price Increase Breaks Four Percent in 2008
• Figure 2-8 Average Annual Percent Change in the CPI for Food and Beverage, Food at Home and Food Away from Home 1978-Q1, 2008 (percent)
• Apparel Price Declines Slowing
• Figure 2-9 Average Annual Percent Change in the CPI for All Apparel, Men' s and Boys' Apparel and Women' s and Girls' Apparel 1978-Q1, 2008 (percent)
• Housing CPI Steady at Three Percent
• Figure 2-10 Average Annual Percent Change in the CPI for All Housing Items, Shelter, Fuels & Utilities and Furnishings & Operations 1978-Q1, 2008 (percent)
• Transportation Costs on the Rise
• Figure 2-11 Average Annual Percent Change in the CPI for All Transportation, Private, Public and Motor Fuel 1978-Q1, 2008 (percent)
• Other Costs Show a Mixed Trend
• Figure 2-12 Average Annual Percent Change in the CPI for Medical Care, Personal Care Products & Services and Education 1978-Q1, 2008 (percent)

Chapter 3 U.S. Consumer Spending Trends and Attitudes

• Note On BIGresearch Data
• Faith No More: 77% Lack Confidence in Economy
• Table 3-1 Percentage of Adults with Little or No Confidence in Short-Term Prospects for the Economy, Month Over Month, October 2007-April 2008 (U.S. adults)
• Table 3-2 Percentage of Adults with Little or No Confidence in Short-Term Prospects for the Economy, Year Over Year, April 2003-April 2008 (U.S. adults)
• Realistic Spending Sets In
• Table 3-3 Percentage of Adults Who Are More Practical or Realistic in Their Purchases, Month Over Month, October 2007-April 2008 (U.S. adults)
• Table 3-4 Percentage of Adults Who Are More Practical or Realistic in Their Purchases, Year Over Year, April 2003-April 2008 (U.S. adults)
• Consumers Consistently Decreasing Spending
• Table 3-5 Percentage of Adults Who Are Planning to Decrease Spending, Month Over Month, October 2007-April 2008 (U.S. adults)
• Table 3-6 Percentage of Adults Who Are Planning to Decrease Spending, Year Over Year, April 2003-April 2008 (U.S. adults)
• Financial Realism Means Cutting Back
• More Paying Off Debt
• Table 3-7 Percentage of Adults Who Are Planning to Pay Down Debt, Month over Month, October 2007-April 2008 (U.S. adults)
• Table 3-8 Percentage of Adults Who Are Planning to Pay Down Debt, Year Over Year, April 2003-April 2008 (U.S. adults)
• Selected U.S. Demographics within Economic Attitudes
  • Prime Consumers Are Tightening Purse Strings
  • Table 3-9 Average Household Income of Adults Who Plan to Decrease Spending, Year Over Year, April 2003-April 2008 (U.S. adults)
  • What About the Lower Income Shoppers?
  • Higher-Income Households Quick to Respond to Change in Economy
  • Table 3-10 Adults Who Plan to Decrease Spending, by Household Income Year Over Year, April 2003-April 2008 (Percent)
  • Table 3-11 Adults Who Plan to Decrease Spending, by Household Income Year Over Year, April 2003-April 2008 (Number in survey of 8,000)
  • Lower Educated More Dramatic, Higher Educated More Sensitive
  • Table 3-12 Adults Who Plan to Decrease Spending, by Level of Education Year Over Year, April 2003-April 2008 (Percent)
  • Homeowners Running Scared
  • Table 3-13 Adults Who Plan to Decrease Spending by Residential Status Year Over Year, April 2003-April 2008 (Percent)
  • Older Adults Increasingly Likely to Reduce Spending
  • Table 3-14 Adults Who Plan to Decrease Spending, by Age Range Year Over Year, April 2003-April 2008 (Percent)

Chapter 4 Potential Consumer Spending Shifts by Category

• Note On BIGresearch Data
• Grocery Spend (Relatively) Spared
• Table 4-1 U.S. Adults Who Plan to Decrease Spending in Groceries, April 2003-April 2008 (U.S. adults)
• Lawn & Garden, HBC and Children' s Clothing Spending Slow
• Table 4-2 U.S. Adults Who Plan to Decrease Spending in: Health & Beauty Care, Children' s Clothing and Lawn & Garden Supplies, April 2003-April 2008 (U.S. adults)
• The Biggest Losing Categories are…
• Table 4-3 U.S. Adults Who Plan to Decrease Spending in: Sporting Goods, Women' s Dress Clothing, Men' s Dress Clothing, Children' s Toys, CDs/DVDs/Videos/Books, and Various Home Goods April 2003-April 2008 (U.S. adults)
• Among Adults Who Plan To Cut Overall Spending, Groceries the Least Effected
• Table 4-4 Spending Plans by Product Category: U.S. Adults Who Plan to Decrease Spending, April 2003-April 2008 (U.S. adults)
• Sporting Goods, Home Furnishings Suffer Most
• Table 4-5 Spending Plans by Product Category: U.S. Adults Who Plan to Decrease Spending, April 2003-April 2008 (U.S. adults)
• Retail Channel Preferences within Category
  • Retail Channel Gains in Specific Product Categories
  • Table 4-5 Selected Retail Channel Preferences by Product Category: Adults Overall, April 2003- April 2008 (U.S. adults)
  • Increased Interest in Savings May Be Boon for Internet Shopping
  • Table 4-6 Selected Retail Channel Preferences by Product Category: Adults Overall, April 2003- April 2008 (U.S. adults)
  • Retail Channel Preferences Are Eroding
  • Figure 4-7 Percentage of Adults With No Retail Channel Preference by Product Category: April 2003 vs. April 2008 (U.S. adults)
  • Warehouse Clubs, Internet Draw Disproportionately Among Shoppers Who Are Curbing Spending
  • Table 4-8 Selected Retail Channel Preferences by Product Category: Adults Overall vs. Adults Who Plan to Decrease Spending, April 2008 (U.S. adults)
  • More Shoppers Head to Discount Stores
  • Weakening Consumer Preference for Wal-Mart?
  • Table 4-9 Selected Retail Chain Preferences by Product Category: Adults Overall, April 2003-April 2008 (U.S. adults)
  • Table 4-10 Selected Retail Chain Preferences by Product Category: Adults Who Plan to Decrease Spending, April 2003-April 2008 (U.S. adults) (U.S. adults)

Chapter 5 Value Shopper Demographics

• Note on Simmons Market Research Bureau Consumer Data
• Value Shopper & Others Defined
• Percentage of Population by Shopper Type
• Table 5-1 Percentage of Shoppers by Type: Average Value Shopper, Extreme Value Shopper, Entertainment Shopper and No Interest Shopper, 2003-2007 (%)
• The Average Value Shopper
• The More Affluent, Educated, the More Value Shopper Minded
• Table 5-2 Top Demographic Characteristics of Average Value Shoppers, 2007 (index)
• The Extreme Value Shopper Splits
• Extreme Value Shoppers are Younger
• …And Older
• Other XVS Demographics
• Table 5-3 Top Demographic Characteristics of Extreme Value Shoppers, 2007 (index)
• A Look at Average Value Shoppers by Household Income
• Table 5-4 Percentage of Average Value Shoppers by Household Income, 2007 (%)
• Profile of Average Value Shoppers with Household Incomes of < $50K
• Table 5-5 Top Demographic Characteristics of Average Value Shoppers with Household Incomes of < $50K, 2007 (index)
• Demographic Profile of Average Value Shoppers with Household Incomes of $50K-$99K
• Table 5-6 Top Demographic Characteristics of Average Value Shoppers with Household Incomes of $50K-$99K, 2007 (index)
• Demographic Profile of Average Value Shoppers with Household Incomes of $100K+
• Table 5-7 Top Demographic Characteristics of Average Value Shoppers with Household Incomes of $100K+, 2007 (index)
• Demographic Profile of Entertainment Shoppers
• Table 5-8 Top Demographic Characteristics of Entertainment Shoppers, 2007 (index)
• Demographic Profile of No Interest Shoppers
• Table 5-9 Top Demographic Characteristics of No Interest Shoppers, 2007 (index)

Chapter 6 Value Shopper Attitudes

• Introduction
• If Anything, A Fun Shopper!
• Table 6-1 Statements Indicating Outgoing, Adventurous, and Unique Attitudes, Fall 2007 (index)
• All New, All The Time
• Table 6-2 Statements Indicating Importance of Early Trial, Adoption and Newness, Fall 2007 (index)
• Value Shoppers as Researchers, Fact Finders and Planners
• Table 6-3 Statements Indicating Role as Researcher, Fact-Finder, Planner, Fall 2007 (index)
• Ask Me, I Know
• Table 6-4 Statements Indicating Importance of Role as Expert, Fall 2007 (index)
• Quality is Key to XVS
• Table 6-5 Statements Indicating Importance of Quality, Fall 2007 (index)
• Going on a Value Hunt
• Table 6-6 Statements Indicating Interest in Value Hunting, Fall 2007 (index)
• Shop for Joy
• Table 6-7 Statements Indicating Joy In Shopping Experience, Fall 2007 (index)
• Brand Savvy
• Table 6-8 Statements Indicating Strong Interest in Brands, Fall 2007 (index)
• Highly Aware of Advertising
• Table 6-9 Statements Indicating High Receptivity to Advertising, Fall 2007 (index)
• But Also Psychographic Pitfalls
• Table 6-10 Statements Indicating a Level of Self-Doubt, Fall 2007 (index)
• Affected by Opinions of Others
• Table 6-11 Statements Indicating Need for Outside Approval, Fall 2007 (index)
• Image May Be Everything to XVS
• Table 6-12 Statements Indicating Importance of Image, Fall 2007 (index)
• Competitive and Controlling
• Table 6-13 Statements Indicating Workaholic Nature, Fall 2007 (index)
• And Yet Still Fearful of Responsibility
• Table 6-14 Statements Indicating Fear of Responsibility, Fall 2007 (index)

Chapter 7 Value Shopper Retail Preferences

• Retailer Categories: Value Shoppers Show Consistently Higher Penetration than Total Population
• Table 7-1 Type of Retailer Shopped in Last Four Weeks, by Shopper Type, 2007 (%)
• Department, Discount, Children' s Toy, Clothing and Footwear Store Preferences
  • Wal-Mart Tops the List of Retailers
  • Table 7-2 Department, Discount, Children' s Toy, Clothing and Footwear Store: Shopped Last Four Weeks by Shopper Type, 2007 (%)
  • Table 7-2 Department, Discount, Children' s Toy, Clothing and Footwear Store: Shopped Last Four Weeks by Shopper Type, 2007 (%)
  • Average Value Shoppers Go to More Stores
  • Table 7-3 Shopping Outlet Preferences of Average Value Shoppers, 2007 (%)
  • Extreme Value Shoppers More Focused on Necessities
  • Table 7-4 Shopping Outlet Preferences of Extreme Value Shoppers, 2007 (index)
  • Entertainment Shopper Store Preference
  • Table 7-5 Shopping Outlet Preferences of Entertainment Shoppers, 2007 (index)
  • Table 7-5[Cont.] Shopping Outlet Preferences of Entertainment Shoppers, 2007 (index)
  • No Interest Shoppers Prefer Not to Shop
  • Table 7-6 Shopping Outlet Preferences of No Interest Shoppers, 2007 (index)
• Supermarket Preferences
  • Table 7-7 Supermarket and Food Store: Shopped Last Four Weeks by Shopper Type, 2007 (%)
  • AVS May Be More Likely to Shop Quality Experience
  • Table 7-8 Supermarket Preferences of Average Value Shoppers, 2007 (index)
  • XVS Indexes Show Mixed Supermarket Allegiances
  • Table 7-9 Supermarket Preferences of Extreme Value Shoppers, 2007 (index)
  • Food Shopping Is Necessity, Not Fun For Entertainment Shoppers
  • Table 7-10 Supermarket Preferences of Entertainment Shoppers, 2007 (index)
  • No Interests Show Some Interest in A&P, Piggly Wiggly & Save-A-Lot
  • Table 7-11 Supermarket Preferences of No Interest Shoppers, 2007 (index)
• A Look at Other Top Retailers by Segments
  • Convenience Stores
  • Table 7-12 Convenience Stores: Purchased Last Four Weeks by Shopper Type, 2007 (%)
  • Drug Stores
  • Table 7-13 Drug Stores: Purchased Last Four Weeks by Shopper Type, 2007 (%)
  • Home Electronics Stores
  • Table 7-14 Home Electronics Stores: Purchased Last Four Weeks by Shopper Type, 2007 (%)
  • Home Furnishing & Houseware Stores
  • Table 7-15 Home Furnishing & Houseware Stores: Purchased Last Four Weeks by Shopper Type, 2007 (%)
  • Home Improvement Stores
  • Table 7-16 Home Improvement Stores: Purchased Last Four Weeks by Shopper Type, 2007 (%)
  • Office Supply/Computer Stores
  • Table 7-17 Office Supply/Computer Stores: Purchased Last Four Weeks by Shopper Type, 2007 (%)

Chapter 8 Looking Ahead

• It' s the Economy Stupid
• Bang the Recession Drum
• Higher Unemployment, Tighter Credit Likely
• The Credit Hangover
• Importance of Reaching Out to All Types of Value Shoppers
• The "Planning" Value Shopper
• The "Opportunistic" Value Shopper
• Communicating to All Value Shoppers a Must
• Official Tasters: The Return of The Freebie
• Opportunity for Marketers to Learn More About Their Loyal Consumers and Innovate
• Fast Food Ahead of the Game
• Retailers Lost
• Telecom to Increase Promotion
• For Many Value Shoppers the Shopping Experience is Key
• Not Just About Price, but It May Seem So
• Surplus and Salvage Groceries: Growth Channel
• Younger Consumers Usher in the New Age of Coupons
• Coupon Use likely to Rise with a Recession
• Heartland Americans Most Coupon Happy
• Average Value Shoppers Comfortable With Variety of Coupons
• Table 8-1 Type of Coupon Ever Used by Value Shopper Cohorts, 2007
• Opportunity for Paperless, Digital Coupons
• Could e-Coupons Breathe New Life to an Analog Industry?
• Word-of-Mouth: Added-Value for Marketers and Consumers
• WOM a Real Business
• Proof in the Numbers
• Added Value of Sustainability Keeps Growing
• Eco-Friendly, Organic Still Important to Value Shoppers
• Core Company Values and Commitment Critical
• There' s Value in Company Values
• Not Just a Fringe Trend
• Green Begets Green, but Skeptics Abound
• Leveraging the Internet
• Value Shoppers Want Options
• Just Give Me the Bottom Line
• Price Most Important to the Well-Off
• What Loses Out to Price
• The Value Shopper' s Best Friend
• Strength in Numbers
• Could Recession Be a Boon for Internet Retailing?
• Where Are Average Value Shoppers Buying Online?
• Table 8-2 Type of Item Ordered Off the Internet in Last 12 Months, 2007 (%)
• Table 8-2[Cont.] Type of Item Ordered Off the Internet in Last 12 Months, 2007 (%)
• Shoppers Still Need Wooing
• Do More than Just Advertise Online
• Will Value Branded Products/Services Surge?
• Private Labels May Be The Lucky Ones