Retailers Get Ready for Thrifty Shift Among Shoppers

by Mark Friedman  on Monday, Aug. 1, 2011 12:00 am  

Eileen Sotomora of Little Rock, with daughter, Charli, said she searches the Internet to find deals on everything from plane tickets to shoes.

Years ago Eileen Sotomora of Little Rock would have spent a lot more than $700 on a mattress for her guest bedroom.

Instead, she bought one on sale at Dillard’s for that price just a few weeks ago.

“I guess I was being thrifty,” said Sotomora, who before the Great Recession paid about $3,000 on a mattress for her and her husband, Dr. Ricardo Sotomora.

Meet the new consumer, who thinks it’s fashionable to be frugal.

See Also:  More Consumers Pick Private Label and  Retailers Change with Customer Behavior

 

Still shaken by the recession, consumers are more likely to hold off spending money on discretionary items and trade down on essentials, according to the Oct. 27 report “Forever Frugal? 2010 U.S. Consumer Survey Confirms Persistent Frugality” by the management consulting firm Booz & Co.

Still, consumers will open their wallets if they think the money is well spent. Marketing experts told Arkansas Bus-iness that consumers will buy products and services if they think they have a value and the companies selling the products are trusted.

The wild success of Apple Inc. is the textbook example of a company that has delivered products that consumers covet, said Tom Dougherty, CEO of business consulting firm Stealing Share of Greensboro, N.C.

“Why would anyone pay $499 for an iPhone 4? I know I did,” he said. “I went out and bought an iPad 2 when I had an iPad 1.”

So have other consumers. For the third quarter that ended June 25, Apple reported record quarterly revenue of $28.6 billion and record quarterly profits of $7.31 billion. During the third quarter, Apple sold 20.34 million iPhones, an increase of 142 percent over the same quarter in 2010. It also sold 9.25 million iPads during the quarter, a jump of 183 percent over the comparable quarter a year ago.

Apple plans to open its first store in Arkansas at The Promenade at Chenal on Aug. 20.

 

 

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