Effects of the Economy on Shopping Habits
The economic downturn has affected the way we spend our money. A recent study has shown that when people’s incomes fall, they tend to spend more money on “experiences” and less on “things.” This is because experiential spending makes us feel better than material objects and it alleviates feelings of stress and anxiety.
Furthermore, people who usually save their income during good times are more likely to splurge in bad times. The article will explore how this affects shopping habits by examining a few specific areas where consumers have changed their spending habits due to the economy: dining out, going to movies, buying books, and purchasing new clothes.
Effects of the Economy on Shopping Habits
The economic downturn has affected the way we spend our money. A recent study has shown that when people’s incomes fall, they tend to spend more money on “experiences” and less on “things.” This is because experiential spending makes us feel better than material objects and it alleviates feelings of stress and anxiety. Furthermore, people who usually save their income during good times are more likely to splurge in bad times.
Dining
One major shift in consumer spending is in regards to dining out. Consumers are less likely to spend money going out for dinner and usually choose instead to eat at home. In 2012, Americans reduced dining out expenditures by 5% compared to 2011. In addition, there has been a similar decrease in the amount of money spent on alcohol from 2006-2012.
Source: American Demographics Magazine
Going to Movies
Another area where there has been a notable change is in movie attendance. In 2007, the average American spent $7.88 per visit to the movies; by 2012, that number had decreased to $7.17. This is likely due in part to higher ticket prices and the increasing popularity of streaming services such as Netflix and Hulu.
Books
Another experiential purchase that has seen a decrease is buying books. In 2011, Americans spent $27.1 billion on books; by 2013, that number had decreased to $25.8 billion. This can likely be attributed to the increasing popularity of e-books and other digital reading formats.
Clothing
Finally, one of the most noticeable shifts in spending habits due to the economy is in clothing. Between 2007 and 2012, Americans decreased their expenditures on clothing by 1%. This can likely be attributed to consumers spending less money on expensive designer brands and instead opting to purchase clothing from cheaper brands or buying used items.
Source: American Demographics Magazine
Shopping changes caused by the pandemic
The pandemic has brought about a whole new set of changes in shopping habits. As people are staying home more, they are buying more items online. In the first quarter of 2020, online retail sales in the United States increased by 17% over the same period in 2019. This is likely due to the fact that people feel safer shopping from home or doing so from the convenience of their smartphones.
foodstuffs
Another change is in grocery shopping. As more and more people are staying at home as a result of fear, supermarkets, and large food retailers have begun to offer delivery services. For example, Kroger, a supermarket chain located throughout the United States, launched its ClickList service in 2012, which allows customers to shop online and have their groceries delivered right to their doorsteps.
Source: Marketing Profs Magzine
pet supplies
In addition, there has been a notable increase in the number of pet owners purchasing food, toys, and other goods for their furry companions. As people are staying at home more often as a result of the pandemic, they are also taking care of their pets more. In one survey conducted in 2020, 70% of pet owners said that they bought groceries for their pets as a result of the pandemic.
Source: American Demographics Magazine
clothes
Finally, the pandemic has caused people to alter their spending habits when it comes to buying new clothes. As people are therefore less likely to leave their homes, they are purchasing fewer new items of clothing. In 2020, Americans spent $19 billion on clothes; this is a decrease of 7% from 2019.
Source: American Demographics Magazine
Conclusion
Even in the face of hardship, human beings tend to adapt and stay optimistic. When we experience difficult times, we will often splurge on experiential purchases such as dining out or going to the movies rather than saving our money for material objects such as clothes and books. In addition, people who usually save their income during good times are more likely to spend lavishly in bad times.
This is because experiential spending makes us feel better than material objects and it alleviates feelings of stress and anxiety. The pandemic has brought about a whole new set of changes in shopping habits, with people increasingly turning to online retail and grocery stores for their purchases.