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Consumer Trends

Data Suggests Inflation-Impacted High-Income Consumers are ‘Trading Down’

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consumers are 'trading down' to high value products
Via CNBC [Photo: Joe Raedle | Getty Images}

High-Income Consumers are ‘Trading Down’ to High-Value Products

Walmart surprised analysts in its latest earnings report for its fiscal second quarter. After having issued a warning last month that its profit may drop as shoppers were feeling the effects of high inflation and focusing purchases on necessities like food rather than discretionary (and more profitable) items such as electronics. But on Tuesday, the company reported solid revenue increases and although earnings tightened a little, they still beat analysts’ forecasts.

In a tough economic environment for retailers, how did they do it? The company says they are attracting more middle- and high-income shoppers. These high-income consumers are ‘trading down’ – an effect that has been discovered in past times of economic slowdowns and recessions. And it seems to be happening now…

Read more about high-end customers trading down

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Index of Consumer Sentiment Bumps Up as Inflation Declines

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This past Friday, the University of Michigan released a preliminary reading of its Index of Consumer Sentiment for the month of August. This survey, one of the more widely followed readings by economists on how consumers are feeling, showed a small but meaningful jump as consumers are feeling a little better about the future. However, the overall results were a bit mixed.

Learn more about consumer sentiment rebounding from a trough

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Massive Population Shifts Coming; India to Overtake China in 2023

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This month, the United Nations released its report on the latest global population trends and it delivered quite a few surprises…and even a bit of a shock. The data shows that major population shifts are coming…and coming soon. First, in a bit of a surprise, we learn that by November 15 of this year, the world population will total 8 billion people. The U.N. says that, in the world we hope to build, that population number will represent “8 billion opportunities to lead dignified and fulfilled lives.” But it also represents 8 billion reasons to remember “our shared responsibility to care for our planet.”

And, in a bit of a shock, we learn that by next year, China will be replaced as the most populous nation in the world by India, whose rate of population growth supersedes China’s. Surprised?

Learn more on the population shifts around the globe

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Consumer Confidence in June at Lowest Level in 16 Mos

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Consumer Confidence in June dropped

The Conference Board announced on Tuesday that consumer confidence in June, as measured by their Consumer Confidence Index, a key indicator of the state of mind of the U.S. consumer, has dropped to a reading of 98.7. This is the first time that the Index has been under its 100 reference level since a post-2020 pandemic recovery. Generally, a reading under 100 indicates a pessimistic consumer likely to cut back on spending.

This is the lowest reading for consumer confidence since February 2021.

See the latest on a declining consumer confidence index

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Economic Anxiety Builds with Unexpected Jump in Inflation in May; Stocks Turn Bearish

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S&P Index ytd performance in bear territory due to inflation
The S&P Index dropped 22% this year by the end-of-day Monday…a bear market

>Consumer Sentiment Hits Record Low in June

Things are changing in the economy faster now, causing a dramatic uptick in economic anxiety. The fuse was lit last Friday when the latest government data showed that inflation increased to 8.6% in May compared to last year. The reading on inflation had been widely expected by most economists to drop a point or two from the 8.3% rate of inflation reported in April. The news sent Wall Street into a tailspin as traders interpreted the increase in inflation as a heightened risk of recession.

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Serve a Luxury Customer? Beware! An Alarming Red Flag Has Just Emerged

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luxury home
Beautiful luxury villa with pool by the sea

A new analysis that correlates consumer confidence by income level has produced a shocking red flag for any business that offers goods and services to the luxury customer – as do many custom integrators. Fire up your sensors and watch closely to see if clients in your market are subject to this alarming trend.

See more on a shift in the attitude of the luxury customer

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As Companies Have Employees Return to Office, Is This the End of Remote Work?

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Google hybrid workspace for return to office
An experimental hybrid workspace and meeting in progress at Google

What Will the Impact of This Trend Be on Custom Integration?

With COVID now seemingly in decline, on Monday Google employees (Googlers?) began the process of returning to work at the company’s various headquarter and other office locations around the country. The company is requiring they work at least three days a week in the office, continuing to work remotely for the other two.

Google is hardly alone in pulling employees back to the office, Apple employees return next week and most major companies have announced dates for office life to begin again. Will this kill remote work and have an impact on the custom integration business?

Read more on this new return to work period

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Consumer Sentiment Nears 11-Year Low; Near-Term Inflation the Bogeyman

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consumer shopping
[Photo: Reuters}

For three straight months now, consumer sentiment has declined as the world faces war in Europe, soaring global gas prices, price inflation on a wide range of consumer goods, and lingering supply chain issues. As measured by the widely followed University of Michigan Index of Consumer Sentiment released earlier this month, the index is nearing its lowest level in 11-years.

See more on the souring consumer sentiment and what it means

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Let’s Get Physical! Vinyl Sales Up >51%, CD Sales Up for First Time in 17-yrs

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Musicians Counterattack, Gain Against the Geeks

In the latest report from the music world, we learned two surprising facts: First, for the first time in 17-years, retail sales of physical compact discs actually increased. And second, for the first time since 1991, vinyl records are the most popular physical media format. It’s big news and much of the media – even mainstream news outlets like CNN – reported on this development. It appears to be part of a surprising swing by consumers back to physical media, as sales of vinyl records in 2021 saw a stunning year-over-year increase of 51.4% – the biggest increase of ANY format, physical or streaming.

What the heck is going on here?

See more on physical media clawing its way back into the hearts of consumers

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Huge 6-Fold Jump in Omicron Infections in One Week; Ready for a New ‘Normal?’

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Omicron causes long lines at testing facilities
A long line of cars waiting for COVID testing recently in New Jersey (NBC News)

Remember back in 2020 when as the stressful year unfolded, we would wistfully daydream about the day when this coronavirus pandemic would come to an end and we’d get “back to normal?” We thought that would happen, like, in 2021. Then 2021 came along and the deadly Delta variant of COVID-19 emerged. “Normal” had eluded us once again.

Enter Omicron which looks to complicate 2022. I think it’s time to forget about getting back to what used to be normal and make sure you and your company are ready for a new “normal”…

See more on Omicron and a new ‘normal’

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