Consumer Behavior in a Down Economy

In studying consumer behavior during a recession, Sharp Market Intelligence discovered that people spend on anticipated, rather than current, circumstances.

Home sales in the last six months have broken records. Car sales were higher than expected in September. Retail sales exceeded projections in October. Holiday spending is off to a brisk start. In light of the slumping economy and gloomy predictions by the vaunted Conference Board and others, what the heck are consumers doing?

Multi-tasking! Americans can worry and spend at the same time. While consumers are concerned about jobs, terrorism, and other threats, they are expecting better times ahead and are spending accordingly.

When a client asked us to investigate "consumer behavior during a recession," we discovered that many people spend on anticipated, rather than current, circumstances.

A consumer's long-range income expectations, coupled with easy access to credit cards and home equity loans, often bolster consumption even in the face of economic uncertainty.

On the other hand, even pessimists find reasons to spend in a down economy. Stocking up on household staples and investing in home entertainment are two ways these consumers "hunker down" for what's ahead.

The bottom line? Whether a consumer sees the glass half-full or half-empty, consumption always fluctuates far less than income.

Can your company take advantage of this quirk in consumer behavior? Do you know what other behavior/attitudes affect purchases of your product?

Seena Sharp authored the recently published Competitive Intelligence Advantage: How to Minimize Risk, Avoid Surprises, and Grow Your Business in a Changing World (Wiley). She founded one of the first competitive intelligence firms, Sharp Market Intelligence, serving clients from Fortune 500 firms to those whose names are unfamiliar – throughout the US, Europe, Asia and Africa. She speaks to business groups globally and has published numerous business articles.

Visit or

Company profile

Sharp Market Intelligence

Sharp Market Intelligence

Hermosa Beach, California, United States of America
(310) 379-5179
About Sharp Market Intelligence:
Our investigations deliver market & competitive intelligence via evidence and insights. Input reveals current, emerging, unknown, and objective info

other content shared by Sharp Market Intelligence

Expanding to Europe Through the Scandinavian Market

Seena Sharp, Sharp Market Intelligence

Most companies when thinking about expanding into Europe are lured by the big countries - UK, France, Germany. The far better decision is to enter the Scandinavian market first as they are much more o...
The "Affluenza" Epidemic

Seena Sharp, Sharp Market Intelligence

Consumers are buying fewer things, but (in their minds) better things. How can your product or service be repositioned to meet both the wants and needs of today's consumer?
Will Smith: Good Actor and Even Better Business Man

Seena Sharp, Sharp Market Intelligence

Will Smith investigated the marketplace before he started his movie career, analyzing the top-grossing movies and developing a strategy. It is a lesson for every business.

Related Market Research Specialties