As the U.S. unemployment rate continues to decline, consumers are less concerned with the job market compared to 30 days ago, and less inclined to curtail spending, according to a Monthly Consumer Survey from BIGinsight. The report showed that, compared to February 2011, consumers have a more positive outlook on their savings habits without decreasing the number of store visits.
Walmart Wins Consumers’ Hearts
With the decline in unemployment rates comes an increasing interest in shopping, and consumers were not afraid to spend at their preferred retailers in early February 2012. The BIGinsight report indicated retailers such as JCPenney, Kohl’s, Macy’s, Target and Walmart were the top stores consumers visited for women’s, men’s and children’s clothing. Of the retailers listed, Walmart received consumer approval in grocery, health and beauty, footwear, as well as men and children’s apparel.
Walmart’s impact on the retail industry became more significant in February 2012, as the retail giant surpassed its competitors in a number of categories by the following percentages:
- Health & Beauty – 26%
- Grocery – 18%
- Men’s Apparel – 14%
- Children’s Apparel – 11%
- Footwear – 9%
The study showed more consumers migrating to electronic products. Best Buy and Walmart were the best-selling two retailers for items such as TVs, computers, DVDs and video game consoles. Nearly 73% of survey respondents indicated that price was their top motivation when choosing a particular electronics store. Other indicators included: location (41%); quality (37%); selection (54%); and service (26%).
Based on the report’s Consumers Migration Index (CMI) for February 2012, Best Buy and Walmart “need an upgrade” if they plan on retaining their customers long term. The CMI tracks new customers who have migrated to/from stores within the past year. Consumers who switched stores noted three specific factors that caused them to migrate within the past year:
- High prices (29%);
- Inconvenient location (17%); and
- Poor selection (9%).
Consumers Plan To Spend On Automobiles, Vacations
Throughout the course of the next six months, spending for approximately 80% of survey respondents said the U.S. employment environment will remain the same. Fewer than 30% said they would reduce expenditures in the next three months, while 28% said they plan to increase their savings. Nonetheless, consumers are confident in their futures, and have increased their spending habits in the automobile and vacation travel categories.
In total, spending habits among all categories have improved over the past two years, based on the results from the report: “The outlook for ‘big ticket’ items continues to be optimistic, as six-month purchase plans improve from February 2011 for high-dollar durables such as automobiles, computers, furniture, major home improvements, TVs and vacation travels.”