An IBM commissioned study based on phone interviews with 4000 consumers yielded the following trends:
- Out of total respondents, 73% say they have made "significant spending cuts" due to economy.
- Hardest hit are those earning less than or equal to $45,000 but 59% of those earning less than or equal to $100,000 say they have also cut back.
- Changes consumers are making: 49% shop at a greater number of stores to get best deal, 35% are switching grocery stores.
- Responses indicate the changes in habits will outlast the slump. Major reason why: Only 15% of respondents think it is "very likely" their household income will rise by 20% in the next 5 yrs. Meanwhile, 45% said their income is "not at all" likely to rise by 20% in next 5 yrs.
- 50% say they're buying less food, 45% have cut back on food not cooked at home, whether from grocery store, restaurant, or take out.
- People are also more open to online coupons sent to their mobile devices to save money.
Significance for the hospitality industry: People are cutting back on their "dining out"
Noteworthy: In the current economy, NEW residents "defy the trend."
Why? Their unique situation (just moved) means they are prepared to spend more than they normally would on a large variety of goods and services. They also have excellent credit as well as money in the bank--otherwise they would not have qualified for that home loan! Everyone has their favorite group of restaurants, i.e. some combination of fine dining, fast casual, ethnic, pizza place, carry-out, etc. You want to get your restaurant on their favorites list!
Why not replace those customers you lose thru normal attrition with newcomers who are actively looking to develop "new favorites!?" A welcome service can "make that introduction" before they (newcomers) visit the competition!!