CHICAGO — "Downturn Generation" is the name of the newest consumer niche that has been created by the current recession, according to Information Resources Inc. These Americans are adopting practices similar to Depression-era shoppers.
"Dissecting the Downturn Generation: Recognizing and Leveraging Permanence in Today’s Transformational Economy" features how shoppers are changing behaviors to adapt to the unstable economy and their permanently changed approaches toward diet, self-care and home maintenance.
Three categories of shoppers are emerging:
- Optimists — Believe "things will get better during the next 12 months"; are spending wisely, cutting back selectively and making sacrifices as a last resort
- Maintainers — Agree "the economy won’t get worse, but it won’t get better either." They are spending wisely, but are more aggressive about making cutbacks.
- Pessimists — Identify with the direst predictions, believing "if you think times are hard now, next year will be worse"; are cutting back wherever possible and searching for deals.
"We believe the Downturn Generation will continue their current behavior patterns until they have regained confidence in the U.S. economy," said Thom Blischok, IRI Consulting and Innovation president.
Nearly 64% of shoppers characterize their financial condition as a little or a lot worse off than last year; approximately 30% believe their finances will be a little or a lot better one year from now. Seventy-five percent note rising food prices "impacted" or "strongly impacted" their financial situation, even though food prices have largely leveled off or declined since summer 2008.
More than 69% of the shoppers are more likely to look through retailer ads for deals. Nearly 82% are more likely to look for sale prices once in the store. Less than two-thirds (65%) say price is becoming more important than convenience in brand purchases.
Between 30% and 47% of consumers are buying less-healthy products, and fewer fresh produce and organic items. This is a fundamental shift from the trends IRI noted before the economic downturn.
New approaches identified include consumers turning to increasing information available on the Internet to help prepare for purchases, clip online coupons and research reviews, commentary and opinions on products and services before making a purchasing decision. More than 44% of shoppers are using online resources to find coupons today; 55% of them plan to continue this practice into the future.
Fifty-nine percent visit multiple stores for the lowest prices, and 42% of those shoppers will continue to do so into the future. Thirty percent are making bulk purchases with others not in their households to secure low unit prices, and 35% of those shoppers intend to continue doing so.
More than 34% are collecting, sharing and trading coupons with others, with 40% of those shoppers planning to continue this behavior.