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American Lifestyles - US - January 2010

SCOPE AND THEMES
What you need to know
Definition
Consumer survey data
Advertising creative
Abbreviations
Abbreviations
EXECUTIVE SUMMARY
Recession: A driver of lifestyle evaluation and change
Resilience: Overcoming obstacles and finding value
Escapism: Entertainment on a budget
Media Evolution: Tech sales lag but millions spend more time online
Ethical responsibility: The next big trend?
INSIGHTS AND OPPORTUNITIES
Young adults will play a key role in driving recovery
Retailers can emphasize bulk foods, meal kits and spices to capitalize on the cooking at home trend
Consider partnering with providers of streaming video to advertise
Consider starting a “keep the change” program
INSPIRE INSIGHTS
Media Evolution
RECESSION: A DRIVER OF LIFESTYLE EVALUATION AND CHANGE
Key points
Economic conditions drive changes in American lifestyles
Most do not think economy is recovering or are unsure
Figure 1: Perception that the economy is recovering from recession, by household income, October 2009
Figure 2: Perception that the economy is recovering from recession, by age, October 2009
Key drivers: Unemployment, income, confidence, and savings rate
Unemployment skyrocketed in 2009 and kept confidence in the economy low
Figure 3: U.S. unemployment and job openings rate, December 2009
Drop in disposable income contributing to reduced spending and lack of confidence
Figure 4: Real disposable personal income, 1984-2009
Consumer confidence remains at historically low levels
Figure 5: Consumer sentiment, 2004-09
Savings rate on the rise
Figure 6: Personal savings rate, 2004-09
Changing strategies for dealing with the recession
Figure 7: Strategies for dealing with recessionary pressures, 2008 and 2009
Most (even affluents) are taking steps to spend less
Figure 8: Strategies for dealing with recessionary pressures, by household income, October 2009
The Big Picture: Lifestyle changes drive down retail and foodservice sales
Figure 9: Retail and foodservice sales, 1984-2009
RESILIENCE: OVERCOMING OBSTACLES AND FINDING VALUE
Key points
Channel analysis: Some discounters win but many retailers struggling
Declines less dramatic in discount channels
Figure 10: Spending patterns in discount channels for food items, by household income, October 2009
Figure 11: Spending patterns in discount channels for non-food items, by household income, October 2009
A case study of success in recession: The Dollar Channel
E-commerce growing rapidly as consumers search for bargains
Figure 12: Incidence of online purchase and average annual online expenditures among users, 2002-2007/08
Middle-aged, elderly, affluents and Asian consumers play key role in driving channel growth
Figure 13: Incidence of internet purchase, by key demographics, 2006 and 2007/08
Online holiday spending grows considerably as brick-and-mortar sales sputter
Consumers more likely to reduce spending in non-discount channels
Figure 14: Change in spending patterns in retail channels for non-food items, by household income, October 2009
Whole Foods may have “turned the corner” as farmers’ markets come into vogue
Figure 15: Change in spending in various specialty channels for food and beverages, by household income, October 2009
C-stores can target young adults to help offset overall reduction in spending
Figure 16: Change in spending in various convenience channels for food and beverages, by age, October 2009
Many reduce spending on restaurants and spend more time cooking at home
Figure 17: Change in spending in restaurants, by type of restaurant, by age, October 2009
Young adults more likely to report increased spending on alcohol
Figure 18: Change in spending on alcoholic beverages, by age, October 2009
Young adults more likely to report increased spending on fair trade and organic
Figure 19: Change in spending on locally grown and organic food, beverages and supplements, by age, October 2009
Many reduce spending on durables for the home but young adults still have need
Figure 20: Change in spending on cookware and furniture, by age, October 2009
Many report drop in spending on mobile devices but demand is strong
Figure 21: Change in spending on mobile phones, by age, October 2009
Many do more with less when it comes to clothing and other discretionary spending
Figure 22: Change in spending in select other categories, by age, October 2009
Spending declines more common in black and Hispanics households
Figure 23: Change in spending in select other categories, by race/Hispanic origin, October 2009
Household changes: Many postpone major life events due to recession
ESCAPISM: ENTERTAINMENT ON A BUDGET
Key points
Americans spending more time entertaining at home
Figure 24: Incidence of spending more time with selected entertainment activities, by age, October 2009
Figure 25: Incidence of spending less time with selected entertainment activities, by age, October 2009
Most families spend less than $100 per month on entertainment
Figure 26: Spending on entertainment, by household income, October 2009
Figure 27: Spending on entertainment, by age, October 2009
A case of declines: Leisure travel sales fell sharply as recession gripped the nation
Figure 28: Change in spending on travel and accessories, by household income, October 2009
Figure 29: Number of summer (June, July, August) leisure travel trips, 2001-09
Figure 30: U.S. Travel Price Index, 2008 and 2009
Capitalizing on entertainment trends: The exercise industry
Figure 31: Prevalence of Americans engaged in recommended and insufficient exercise, 2001-07
Widespread interest in products and services among women and young adults
Figure 32: Exercise tracking, routines and interests, by age, July 2009
MEDIA EVOLUTION: TECH SALES LAG BUT MILLIONS SPEND MORE TIME ONLINE
Key points
Young adults more likely to report increased spending
Figure 33: Change in spending on computers, home entertainment, and mobile devices, by age, October 2009
Hispanics and blacks more likely to report reduced spending
Figure 34: Change in spending on computers, home entertainment, and mobile devices, by race/Hispanic origin, October 2009
Evolution of online media continues to drive widespread lifestyle change
Figure 35: Increased use of online entertainment and research activities, 2008 and 2009
Affluents, like young adults, drive the evolution
Figure 36: Change in online entertainment usage—movies and video, by household income, October 2009
Figure 37: Change in online entertainment usage—blogs and online community activity, by household income, October 2009
Figure 38: Change in online research activities, by household income, October 2009
Social networking and micro-blogging sites growing quickly; becoming more diverse
Figure 39: Incidence of overall and recent use of social networking sites, 2005-09
Online ad sales grow quickly as millions spend more time on the web
Twitter growing quickly as consumers seek ways to share information more efficiently
Americans embrace streaming video as inexpensive alternative to DVDs
The rise of the third screen: Mobile going big
ETHICAL RESPONSIBILITY: THE NEXT BIG TREND?
Key points
Many embrace organics as a healthier—and more responsible—way to consume
Relative stability of charitable donations reflects the generosity of Americans
HP2 expenditures indicate demand for ethical products is resilient
Figure 40: HP2 market size and forecast, at inflation-adjusted prices, 2002-13
Minorities somewhat more likely to report a drop in spending
Figure 41: Change in spending patterns on locally grown, fair trade, “good for you,” organic products and supplements, by race/Hispanic origin, October 2009
Most category users report spending about the same amount on eco-friendly products
Figure 42: Change in spending for products purchased specifically to reduce the environmental impact, by age, October 2009
Figure 43: Change in spending for products purchased specifically to reduce the environmental impact, by household income, October 2009
Most users of fair trade products spending about the same as last year
Figure 44: Change in spending for fair trade products, by age, October 2009
CLUSTER ANALYSIS: ENTERTAINMENT-RELATED
Upholders (26%)
Actives (44%)
Sedentaries (30%)
Cluster characteristics
Figure 45: American lifestyle entertainment clusters, October 2009
Figure 46: Incidence of spending more time on entertainment activities, by American lifestyle entertainment clusters, October 2009
Figure 47: Incidence of spending about the same amount of time on entertainment activities, by American lifestyle entertainment clusters, October 2009
Figure 48: Incidence of not participating in various entertainment activities, by American lifestyle entertainment clusters, October 2009
Figure 49: Monthly entertainment budget, by American lifestyle entertainment clusters, October 2009
Figure 50: Incidence of lifestyle changes, by American lifestyle entertainment clusters, October 2009
Cluster demographics
Figure 51: American lifestyle entertainment clusters, by gender, October 2009
Figure 52: American lifestyle entertainment clusters, by age, October 2009
Figure 53: American lifestyle entertainment clusters, by household income, October 2009
Figure 54: American lifestyle entertainment clusters, by race, October 2009
Figure 55: American lifestyle entertainment clusters, by Hispanic origin, October 2009
Cluster methodology
APPENDIX: ADDITIONAL INCOME COMPARISONS
Figure 56: Change in spending in select convenience channels for food items, by household income, October 2009
Figure 57: Change in spending on locally grown and organic food, beverages and supplements, by household income, October 2009
Figure 58: Change in spending on computers, home entertainment, and mobile devices, by household income, October 2009
Figure 59: Incidence of spending more time with selected entertainment activities, by household income, October 2009
Figure 60: Increased use of online entertainment and research activities, by household income, October 2009
APPENDIX: ADDITIONAL AGE COMPARISONS
Figure 61: Spending patterns in discount channels for non-food items, by age, October 2009
Figure 62: Spending patterns in retail channels for non-food items, by age, October 2009
Figure 63: Spending patterns in specialty channels for food items, by age, October 2009
Figure 64: Strategies for dealing with recessionary pressures, by age, October 2009
Figure 65: Incidence of shopping websites for non-food items in last two years, by age, October 2009
Figure 66: Spending patterns in retail channels for non-food items, by age, October 2009
Figure 67: Spending patterns in retail channels for non-food items, by age, October 2009
Figure 68: Patterns in online entertainment and research activities, by age, October 2009
APPENDIX: ADDITIONAL RACE/HISPANIC ORIGIN COMPARISONS
Figure 69: Spending patterns in discount channels for non-food items, by race/Hispanic origin, October 2009
Figure 70: Spending patterns in specialty channels for food items, by race/Hispanic origin, October 2009
Figure 71: Spending patterns in discount channels for food items, by race/Hispanic origin, October 2009
Figure 71: Restaurant spending patterns, by race/Hispanic origin, October 2009
Figure 72: Spending patterns in retail channels for non-food items, by race/Hispanic origin, October 2009
Figure 73: Spending patterns on gourmet food and furniture, by race/Hispanic origin, October 2009
Figure 74: Spending patterns on travel and accessories, by race/Hispanic origin, October 2009
Figure 75: Incidence of shopping websites for non-food items in last two years, by race/Hispanic origin, October 2009
Figure 76: Entertainment activities, by race/Hispanic origin, October 2009
Figure 77: Online entertainment and research activities, by race/Hispanic origin, October 2009

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