According to a report from Resonate, 28% of consumers abandon the brands they love due to higher prices. It makes sense. With gas reaching $7 per gallon in California and inflation rising, consumers are cutting back on spending. When they do spend money, they’re very thoughtful about where their money goes. A study from Unity Marketing in 2021 found that affluent consumers are thinking twice about even small purchases, and when they decide to buy, they want to feel confident that it is the right choice and will bring them joy.
At the same time, a report cited in Business Insider shows that consumer spending on luxury products is growing. Even as the cost of living increases, many consumers are trading down and cutting back on discretionary purchases.
The data suggest that more consumers are becoming affluent or just trading in their $2,500 Quilted Lambskin Burberry purses for the lower-end cotton pouch that costs $800.
The Economy Will Never Bounce Back
According to Resonate, 27% of consumers believe the US economy will never return to pre-pandemic levels. I share the same sentiment. My 401K is hemorrhaging, and it looks like the stock market crash of 1929.
This matches the recent Conference Board’s Consumer Confidence Index report, which shows that consumer confidence declined in May due to 40-year high inflation, worries about food prices, and the perception that the labor market is down. But, interestingly, there was a record high in new job openings in May.
It’s not all doom and gloom, though. According to Resonate, some consumers are optimistic that the economy will bounce back within 1-7 months.
But like everything else, things change, almost like working from home.
The Market Shifts Away From Work from Home
According to Resonate, 18% of workers must return to work in the company’s office, up 3 points from September 2021. This is causing tension among employees and managers. This recent article from NPR highlights a few real stories about employees not wanting to return to the office despite being told to do so by management. The struggle is real.
Here’s where the data gets wacky.
According to Stanford University professor Nicholas Bloom and a team of academics, remote workers reported being 9% more efficient at home than working in the office. The survey respondents are employees, not managers, so there’s a disconnect in the organization. Either the employees believe they are more efficient than they are, or their efficiency is real, but no one in the organization realizes it.
In the same Resonate report, 5.3% of workers said their organizations still have work-from-home policies. This is down from 21.5% back in September 2021. Despite the work-from-home business challenges, 4.1% of consumers who work from home plan to relocate within six months.
Bleisure Travel on the Rise?
Bleisure Travel is when business travelers take an extra day or two to their work trips for leisure. The report doesn’t mention “bleisure travel” specifically.
As with most things in life, some optimists look on the bright side of everything. This is the “glass-half-full” crowd. And then there are the others, the “half-empty” crew who focus solely on the negative.
The report found that 35% of consumers believe that leisure travel will return to normal in 1-3 months. However, the less-optimistic crowd is thinking more like seven months (26.5%), and the 19% of nay-sayers don’t believe travel will ever return to normal.
Business travelers are less optimistic. 31% believe that business travel will never return to normal. Perhaps it’s because they don’t want it to.
The other 31% think business travel will bounce back in 1-3 months. I’m with this crew.
I highly recommend you download the Surfing the Data: Consumers Look Forward to Summer Emerging Trends Report by Resonate to get the full context of the research.
If you are interested in understanding integrated marketing, look at this new guide on the PESO model. It goes deep into each channel, providing examples and actionable takeaways.
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