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Recession past and present.


In November-December 1991, when the U.S. economy was in a funk that was changing the way people shopped, we conducted a survey titled "The Economy, General Opinions and Personal Impact." In many ways, the two recessions were similar, with unemployment rising and shoppers trading down. The statements we presented to our consumers in 1991 seemed so timely that we decided to repeat them, asking another cross section of our shopper panel to agree or disagree on a 5-point scale ranging from 5-Definitely/strongly agree to 1-Definitely/strongly disagree.

When the 1991 survey was conducted, the first George Bush was in the White House. A first-class stamp had just gone up to 29 cents. "Dancing with Wolves" had won the Academy Award. The Soviet Union had just broken up. Google, cell phones, smart phones, FaceBook, Twitter, global warming, and 9-11--all were in the future.

In spite of all the changes, today's shoppers' responses to many of the statements are very close to the responses they triggered in 1991. Today's shoppers are buying more basics and less of everything else. They are thinking more before spending. They don't understand how the economy works, and they don't think many other people do either. Some chalk the recession up to the biblical good years that follow lean ones. Many think the deficit is a major problem, although not as many are worried about it today as they were back then. In spite of the widespread shakeups, bank failures, foreclosures, and bankruptcies, fewer than one in five think we are heading into a depression

The biggest difference between the 1991 and 2009 shoppers is about making painful cuts in buying rather than making adjustments. Many more of today's shoppers say that they have had to stop buying things they want in order to buy things, they really need. More are worried about what would happen to them if they lost their job, and what is happening to people they know who have lost their jobs. More are blaming this recession on greed that has resulted in corporate executives and traders "stealing the people's money." More of today's shoppers are concerned about the growing divide between haves and have-nots. Fewer shoppers are spending more, even when they find more value. More want to help those who are falling off the cliff and appreciate those who make it easier to donate and raise the profile of helping.

One of the other big differences was in response to a statement about companies being responsive to the troubled economy. Fewer than 10 percent of this year's respondents say they are impressed with any company's responsiveness. Among supermarkets, Publix and Wal-Mart got the most citations for being responsive to the economy. Back in '91, that honor went to Wal-Mart and Safeway. (Statements are in bold; verbatim responses, all from 2009 survey, are shown in italics.)

* "It's very difficult to know what is really going on or what to do."

* "It's frustrating that the new jobs are so slow in coming."

* "These are bad times for people without savings. "

* "I certainly don't understand why they are closing all the car dealers if they want to continue selling cars. Where do we buy them? Where do we go for service? "

* "Companies are going under. People too."

* "The deficit is really scary - how will we ever recoup."

* "We have to think positive."

* "The media and government people all have jobs and don't get what it's like to lose one now."

* "I buy where I find the cheapest food - cannot afford the rest."

* "Reading ads more closely, comparison shopping, taking advantage of sales, using coupons for stores and restaurants."

* "Shop second-hand stores and garage sales.

* "You pay more and get less - products have shrunk in size and the quality isn't there."

* "Things that look like a bargain aren't --smaller packages, coupons that require multiple purchases."

* "There are great values on things lean 7 afford."

* "The shrinking of counts, sizes, and weights makes value very hard to find. There are fewer soft drink cans in a big box, and now Wal-Mart has reduced the count (from 24 to 20) in its standard package of bait worms. I can understand food packages shrinking, but worms?" Besides reducing the value, it doesn't come out even - when I fish, I use eight worms a day."

* "Dollar Tree greeting cards are 50 cents versus $1 to $6 at Hallmark."

* "Using more coupons and shopping online."

* "Shopping Wal-Mart and Kmart, buying off-label clothes, grocery, etc."

* "2 for 1 items at supermarkets."

* "Buying romaine lettuce instead of iceberg lettuce."

* "Kmart had double coupons to $2.00 one week and triple coupons to 75 cents another. Wow. That hasn't happened before. I did my best to take advantage of it."

* "If an item I regularly use is on sale (really good price), I buy enough to last for months.

The big difference between then and now is in the percent of respondents who strongly agreed, e.g., have been wowed by a company's or brand's response. Although it is not shown in this chart, the absence of "wow" was almost total among younger respondents. The percent who modestly agreed was closer to the 1991 response. Three other things were noteworthy about the responses to this statement:

1) The number of responders mentioning Publix as being really responsive.

2) Many responses like "Don't know any" and "Where are they?" from people who believe that companies and executives are out to make as much as they can no matter how bad things are at the bottom.

3) The perception that offering more store brands is consumer responsive in a recession.

* "Are there any? "

* "Stores have more generic. "

* "With most companies, it's too little too late."

* "Stop & Shop started lowering everyday prices."

* "Who are they? Publix only one I know."

* "Publix is going a great job of trying to help."

* "Kroger gives us cents off on gas and good coupons."

COPYRIGHT 2009 Consumer Network, Inc Reproduced with permission of the copyright holder. Further reproduction or distribution is prohibited without permission.

Copyright 2009 Gale, Cengage Learning. All rights reserved. Gale Group is a Thomson Corporation Company.

NOTE: All illustrations and photos have been removed from this article.


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