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David Lipman, chairman of New York-based Lipman Advertising, didn’t put a time stamp on the possible duration of consumer frugality but observed that the spending decline isn’t over.
“Shoppers are free-falling and they won’t start buying again until they hit the ground,” he said, adding that purchases will be based on a product’s creativity and value, not brand name. “I don’t think we’ll see another era of logo mania again in the next decade.”
James Burroughs, associate professor of commerce at the University of Virginia, who researches consumer behavior, agreed the recession has taught shoppers they can do without certain things, and they are not likely to soon go back to purchasing them the same way they did.
“People are asking if it is all worth it — starting to realize the cost benefit was not what they believed, and are not willing to work 80 to 90 hours a week anymore,” he said.
The Pew survey revealed more about how people behave rather than how they perceive things, said Robert Thompson, professor of television and popular culture at Syracuse University.
“Ask the average person on the street, especially in these bad economic times, if they think air conditioning is a luxury or necessity and they will say luxury,” he said. “But a lot of people would find themselves put out and really miss it if it was taken away.”
Consumers often give answers to surveys they feel are expected, he added. “Most people surveyed would say there’s too much sex on TV, yet at the same time they’re checking the survey box they’re flipping though the dial looking for the sexiest show they can find.”
In the Pew study, new perceptions about what is necessary cut across all income groups, with individuals who have suffered most in the recession naturally being those who have done the most cost-cutting. This may indicate that consumer reaction to the weak economy is being propelled by a wide-ranging “new creed of thrift” among people who have and have not experienced personal economic difficulties, researchers said.
One in four of those surveyed said they or a household member had lost jobs in the past year; almost half said they or a household member had lost more than 20 percent in retirement or investment accounts, and one in five said they or household members had problems making mortgage or rent payments.
“There’s nothing like economic bad times to focus the minds of Americans on what is important and isn’t important,” Pew’s Morin said.