updated 10:00 pm EST, Thu December 11, 2008
The most recent ChangeWave survey of consumers' spending outlook suggests that the negative trend has leveled off, but the forecast still remains bleak. The 90-day spending plans of surveyed individuals suggests that 60 percent of consumers expect to spend less during the next few months, while only 11 percent expect to spend more, marking the worst numbers that the research company has seen since the surveys began. The number of respondents in the category that plans on spending more has only risen by one-point since the November survey, while the spend-less group also increased by one percent.
Of the individuals that claimed to be tightening their wallets to improve personal finances, 39 percent were making the change to save more money, while 33 percent were trying to reduce debt and eight percent would use the money for investing.
The number of respondents that cited reduced income has grown four points to 37 percent. The company associates the reduced income with the ongoing recession that has reduced the spending power of many individuals and families.
The dire situation may not hurt every retailer, as many consumers flock to discounters as a way to maximize product purchases using reduced holiday budgets. The survey suggests that people plan on spending more at Wal-Mart and Costco, but less at other traditional retailers such as Bed, Bath & Beyond or Sears.
The consumer electronics and home entertainment segment shows slightly different results, with 23 percent of people planning to spend more money in the category, a positive change of four points, but 43 percent still plan on spending less. Apple and Amazon are on the upside, leading the pack when comparing locations where consumers will spend more. Circuit City, Target, and Best Buy hold the weakest outlook, according to the surveys.