Demand Analytics Conference Blog

Let’s take a look at recent data released by the latest Harris Poll. This poll is in regards to changes in consumer spending due to the recession. Here are some of the results:

” 64% are purchasing more generic brands
” 47% are brown-bagging lunch instead of purchasing it
” 43% have been going to the hairdresser/barber/stylist less often
” 36% have switched to [a] refillable water bottle instead of purchasing [a] bottle of water
” 34% have canceled one or more magazine subscriptions
” 22% have cut down on dry cleaning
” 21% have canceled a newspaper subscription
” 21% have canceled or cut back cable television service
” 20% have stopped purchasing coffee in the morning
” 15% have changed or canceled cell phone service
” 14% have begun carpooling or using mass transit
” 12% have canceled landline phone service and [are] using only [a] cell phone

There are many differing opinions about how much longer this recession will continue. On a positive note, experts have

begun to see noticeable differences in profit outlooks- predominantly in retail stores. For instance, companies like Kohl’s, J.C. Penney Co., and Target were able to boost their projections after September’s back-to-school sales were more successful than expected. And last month, for the second month in a row, the retail market achieved earnings that were greater than original predictions, with the most significant profits since July 2008. Even so, the decreases in consumer spending habits aren’t likely to radically change soon. As the holidays are fast approaching, companies are strategizing on how to make the most of our current situation and see an increase in profits for the upcoming season. Here is an excellent example of how to accomplish this:

The frugal consumer is always looking for a bargain. Go beyond “On Sale.” Offer significant savings in valuable coupons, freebies and samples. Building an email database is an indispensable tool for companies to send special savings codes/coupons/vouchers to customers. Emails save money and is a much more “green” sales approach. They eliminate the need for postage and paper. They drive website traffic. And for companies that offer e-commerce, providing coupon codes eliminates trips to the store, saving the customer’s gas. (This is something that can be pointed out to them, too.) Sales are rampant during the holidays and can get to be so common that they don’t stand out to the customer. Special promotions with an expiration date- that can be applied on top of an already existing sale- create a sense of urgency and give the customer a reason to shop at a particular store. Allowing customers to pass along these savings to their friends and family is simply free, positive word-of-mouth advertising that generates more sales and increases a company’s loyal customer base.

Especially during this time of year, companies having access to real-time data will have a crucial edge in answering the W’s- who, what, when, where, and why. These companies will be the true industry leaders of tomorrow. Soon, it will be possible to have real-time information in the palm of your hand; but until then, you too can be a thought leader by staying abreast of the latest demand data trends facing the consumer packaged goods and retail industry.