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Consumer Confidence Holds Steady in February

PriceGrabber Survey Says Who Will Spend on Jewelry

Feb 29, 2012 7:30 PM   By Rapaport News
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The Conference Board's Consumer Confidence Index® in February 2012 was steady from one year ago at 70.8 points (1985=100). The reading was, however, much higher than it had been in January at 61.5 points. The Present Situation Index increased to 45 points from 33.4 points one year ago, but the Expectations Index fell to  88 points from 95.1 points in February 2011.

Lynn Franco, the director of The Conference Board Consumer Research Center, said, ''Consumer confidence, which had declined last month, posted a sizeable improvement in February.  The Index is now close to levels last seen a year ago.   Consumers are considerably less pessimistic about current business and labor market conditions than they were in January. And, despite further increases in gas prices, they are more optimistic about the short-term outlook for the economy, job prospects, and their financial situation.''

Nonetheless, only 13.3 percent of consumers said business conditions were good this month,   those claiming business conditions were bad was  31.2 percent.  Consumers’ who stated that jobs were plentiful was only  6.6 percent and those saying jobs were hard to get was at 38.7 percent.

In other news, more than 51 percent of U.S. consumers plan to spend the same amount of money in 2012 as they did in 2011,  according to a 2012 Shopping Outlook survey conducted by PriceGrabber®, a part of Experian. Twenty-one percent indicated they plan to spend more, and 28 percent plan to spend less.

Of the group that intends to increase spending were asked to explain their reasoning,  36 percent cited confidence in the economy and another 36 percent said that they expect retailers to offer better discounts this year. Thirty percent indicated that they are earning more money in 2012, while 6 percent said that they were tired of being frugal and 5 percent cited a credit limit increase. Another 5 percent said they had found employment in the past year.

When the respondents who plan to spend less   were asked to select all of the reasons why, 40 percent cited increases in prices such as gas, food and necessities; 34 percent said lack of confidence in the economy. Twenty-nine percent indicated they were making less money this year, and 16 percent said they overspent during the 2011 holiday season.

''Our data shows that shoppers plan to remain optimistically cautious with their spending again this year and expect retailers to continue to offer deals and incentives on products,'' said Graham Jones, general manager of PriceGrabber. ''We expect retailers will continue to roll out a number of tactics, such as free shipping, larger discounts and online-only promotions to help win the consumer dollar this year, while implementing strategies that will span brick-and-mortar, online and mobile shopping platforms to entice consumers to shop.''

More than half of the consumers said that  electronics and clothing, followed closely by travel and vacations, household supplies and dining out would grab the attention of their wallet this year. Twenty-nine percent said they will spend more on furniture, books or DVDs, followed by jewelry, toys, events, sporting goods and fitness memberships.

The daily deal industry looks like it will remain strong in 2012. Forty-six percent of PriceGrabber survey respondents indicated that they plan to use daily deal sites, such as Groupon®, Living Social® or PriceGrabber’s local deals category, more often in 2012 than in 2011. When consumers who plan to use these sites more frequently were asked to select all of the categories they will search the most, 53 percent said food and dining, 46 percent said shopping, 42 percent said entertainment and events, and 34 percent said family and kids.

When asked how they plan to shop in 2012, 45 percent of PriceGrabber survey respondents said they will combine online, brick-and-mortar and mobile shopping. Forty-two percent said they will shop mostly online, 12 percent will shop mostly in brick-and-mortar stores, and 1 percent will shop primarily from a mobile device. According to the survey, the average shopper will make 53 percent of his or her overall purchases online, 42 percent from brick-and-mortar stores and 5 percent from a mobile phone.

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Tags: board, conference, confidence, consumer, expectations, patterns, Rapaport News, spending
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