During economic booms, consumers’ definitions sometimes become clouded. “I want” is quickly replaced by “I need.” Rolex replaces Timex, and Cadillac trumps Chevy, according to Peak Newsroom, a business news blog. A sinking economy, shrinking employment and decreased discretionary income can quickly affect an attitude change. After years of almost gluttonous consumer spending, self denial is in style. The shift is affecting even those who don’t feel direct pressure on their income. With so many businesses and individuals struggling, unnecessary shopping just doesn’t seem appropriate. Even the exclusive Beverly Hills Rodeo Drive shopping district is feeling pressure. A sales clerk at a trendy boutique there recently said, “Sales are down; there’s an umbrella of guilt over everyone.”
Playing It Safe
The recent economic upheaval has had a powerful effect on consumer behavior. Some market researchers are comparing this economy’s effect to that of 9/11 as well as Japan’s economic crash in the early ’90s. “People are on alert,” says Martin Lindstrom, author of Buyology. “What happens when you are afraid is you act safe.” He predicts this safe approach will show up in more consumer spending details.
As people economize, spending less becomes cool. Boasting about purchasing a $50 faux-leather designer handbag becomes more hip than buying the genuine $500 edition. At Shoe Box stores from New York to Florida, the most expensive handbags and shoes remain on shelves while the less expensive models sell like hotcakes. Melanie Gording, wife of a California optometrist, has replaced her husband’s Nordstrom dress shirts with ones purchased at Costco for $16.99. Gording told Peak Newsroom blogger P. McVay that even special occasions won’t budge her. “Just before this crisis stuff was going on, my daughter asked for a new skirt and I bought it, no problem,” she says. “Now it’s, ‘Nope. You need nothing.’”