by Sarah Schmidt
December 1, 2015
The future of market research is now in the Packaged Facts report American Consumers in 2020. Learn all the essential insights to thrive in an ever-changing retail world. View the toc and abstract here.
Although the Great Recession officially ended five years ago, the American economy has failed to achieve the robust growth experienced in the aftermath of the economic downturns experienced in previous decades. The overhang caused by unfettered lending to overleveraged consumers as well as the drag on recovery caused by the growing gap in American society between the handful of haves and masses of have-nots has proven to be too much for the economy to overcome. As a result, according to Packaged Facts in the report American Consumers in 2020, U.S. marketers and retailers in 2020 will find themselves operating in an economy reflecting the “new normal” of modest growth forecast in 2015 by agencies such as the Federal Reserve and Congressional Budget Office.
Ebbing and flowing consumer confidence is a major wildcard in efforts to develop plausible economic forecasts and effective corporate strategies. Data compiled by Packaged Facts August 2015 National Online Consumer Survey about consumer attitudes toward the future suggest that marketers and retailers may have some cause for optimism about how their own corporate futures will unfold. For example, American consumers in 2015 have a less dystopian view of how the world of 2020 will look than might be expected given the harsh realities many have faced in recent years. Looking ahead five years, only 24% think that their food supply will be less safe and just 34% believe that global warming will make life harder in five years.
American consumers in 2015 also are relatively optimistic about their personal prospects in the years leading up to 2020. Seven in 10 either strongly or somewhat agree that “I am optimistic about the future” and more than 60% think their job prospects look good over the next few years. Although just 29% believe that the American economy will be better off in 2020 than in 2015, this gloomy vision of the broader economy is tempered by the fact that a significantly higher percentage (42%) believe that their personal financial situation will be better off in 2020.
Still, Packaged Facts survey data offer a note of caution about what marketers and retailers are likely to experience in the years leading up to 2020. In line with trends identified recently by Gallup polling, Packaged Facts survey data suggest that American consumers are likely to continue the frugal ways they adopted during and after the Great Recession. When respondents were asked whether over the next few years they expected to spend “more, less or about the same” on selected expenditure categories, more than 40% expected to spend more on essential items such as household utilities, groceries, housing expenses, out-of-pocket healthcare expenses and gasoline. Although nearly as many respondents expected to be spending more over the next few years on discretionary categories such as travel (39%) and home maintenance/improvements (38%), a substantially lower percentage expected to be spending more on non-essential activities such as eating out (32%) and both away-from-home and in-home entertainment (31% and 29% respectively).
Yet, there is at a ray of hope about the potential for increased consumer spending of all kinds in 2020. Only 25% of survey respondents expect to be spending more over the next few years than they are now on repaying consumer debt. This suggests that the vast majority of consumers will have cleaned up their household balance sheets and consequently will have far more disposable income by 2020.
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