More than one-third of Americans expect to spend less money this holiday season, prompting retailers to shift their ad focus to value for money, according to a report by the Nielsen.
The Schaumburg, Ill.-based research group surveyed 21,000 U.S. households in September and found that 35 percent across all income groups expected to spend less. Only six percent are planning to spend more. Among higher income respondents, fully 32 percent are expecting to spend less.
This week, a Gallup poll reported steep declines in consumer confidence. Of 1,500 Americans interviewed nationwide, 59 percent think the economic situation is poor, up by more than 20 percent from last month. Almost all said they felt the economy was getting worse.
According to James Russo, Nielsen's vice president of marketing, the worsening economic conditions mean "a weak holiday shopping season and quite possibly the worst holiday spending decline since the worldwide recession in the early '90s."
In light of dismal consumer confidence and gutted holiday budgets, the report predicted that value-targeted ads will be the best way to reach customers.
"Retailers answering consumers' call for value will capture shoppers' attention this holiday season," Todd Hale, senior vice president of Consumer & Shopper Insights, said in a statement. "Whether it's lower prices, instant rebates or free shipping offers, value messages will speak to bargain-seeking consumers in today's tough economic climate," he said.