2010 HOLIDAY SPENDING SURVEY

WHAT AMERICANS ARE BUYING HOW MUCH THEYRE SPENDING, ON WHAT AND WHERE WHAT CELEBS HAVE BEEN NAUGHTY AND NICE

November 24, 2010

NEW YORK WASHINGTON DENVER SEATTLE LOS ANGELES SAN FRANCISCO AUSTIN LONDON HONG KONG BEIJING DUBAI

PENN SCHOEN AND BERLAND ASSOCIATES LLC.

Introduction
As the holiday spending season begins, and Americans continue to reckon with a slower-thanexpected recovery, new research released today reveals that consumers are largely planning to hold the line on spending relative to 2009. 52% say that they will spend the same or more than they did last year. Though Americans see the economy today as better than it was, and are less concerned about losing their jobs, they are more concerned about the prospects for future economic growth than they were last year, and their budgets continue to be guided by caution about the current climate. In turn, consumers are increasingly turning to the Internet for their holiday shopping needs; 37% plan to shop online more this year, a gain of 7% over last year. And for the under-40 segments, the rise of social shopping continues as a key trend; 24% of social media users (representing 72% of total respondents) say they will make a purchase decision this holiday based on a recommendation they receive from friends or family through a social media network including 34% of 30-39 year olds and 30% of 18-29 year olds. With Americans looking for ways to get into the holiday spirit, respondents were asked to choose from a list of public figures to determine whos been naughty and whos been nice in 2010. Sandra Bullock and Taylor Swift continue to be seen as particularly deserving of holiday generosity this year, while Americans think that Tiger Woods and Mel Gibson should be in for some healthy servings of coal. Penn Schoen Berland conducted 1,006 Internet interviews of American consumers from November 16-17, 2010. The margin of error is 2.53% and larger for subgroups.

State of Personal Finances and Effect on Gift-Giving

Overall, consumers are feeling slightly better about the current state of the nations economy; 5% fewer describe it as poor than did so in 2009. And going forward, many are optimistic that the economy will improve; while just 16% think that the economy is in excellent or good shape today, 35% think it will be in one years time. How would you describe current state of the nations economy?
Excellent Good Not so good Poor

2010

2009

Change

Male

Fem

Income <40K

Income 40-70K

Income 70K+

2 14 58 27

2 11 55 32

0 +3 +3 -5

2 15 55 28

1 12 61 26

1 13 57 29

1 10 61 28

2 18 57 23

A year from now, what state do you think the nations economy will be in?
Excellent Good

2010

2009 4 38

Change -1 -6

Male

Fem

Income <40K

Income 40-70K

Income 70K+

3 32

4 31

2 34

2 32

3 30

5 34

PENN SCHOEN AND BERLAND ASSOCIATES LLC.

Not so good Poor

49 16

41 17

+8 -1

45 20

53 11

48 18

51 16

49 12

Americans are also feeling more positive about the state of their personal finances particularly those with annual household incomes over $70,000. 43% say that their personal finances are excellent or good, an increase of 6% over 2009; 56% of wealthi er respondents say the same. Consumers are also feeling increased job security, as 6% fewer report that they are very concerned about losing their job in the next year.

How would you describe the state of your own personal finances?
Excellent Good Not so good Poor

2010

2009

Change

Male

Fem

Income <40K

Income 40-70K

Income 70K+

3 40 42 16

5 32 41 22

-2 +8 1 -6

3 39 40 18

2 40 43 14

2 29 47 23

1 43 40 16

6 50 35 9

How concerned are you that you will lose your job in the next year? Very concerned Somewhat concerned Not very concerned Not at all concerned

2010 15 27 29 30

2009 21 24 24 31

Change -6 +3 +5 -1

Male 15 29 27 28

Fem 15 25 30 31

Income <40K 19 27 23 31

Income 40-70K 13 29 31 27

Income 70K+ 12 25 34 28

Consumers feeling slightly more optimistic about the national economy and their personal financial situations, but how will that impact their holiday spending? Most consumers are planning to maintain their prior levels of spending this season 52% say they will spend the same as they did last year. However, 29% are planning to cut back, including 33% of male respondents. Indeed, the current economic situation continues to exert a strong influence on holiday spending, with 33% saying that their budget will be affected significantly compared to past holiday seasons before the recession. This trend remains largely unchanged from 2009.

Compared to last year, do you plan to spend more/less/the same during the upcoming holiday season?

All

Male

Fem

Income <40K

Income 40-70K

Income 70K+

More

19

19

30

17

19

19

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The same Less

52 29

48 33

45 25

54 29

53 27

52 29

How much do you think the current economic situation is going to affect your budget this holiday season compared to past holiday seasons before the recession?
Significantly Moderately Slightly Not at all

2010

2009

Change

Male

Fem

Income <40K

Income 40-70K

Income 70K+

33 31 19 17

36 30 20 14

-3 +1 -1 +3

32 30 18 21

35 32 21 13

44 29 27 10

30 32 22 17

24 34 20 22

Consumers who plan to spend less this holiday are largely doing so because they are trying to get out of debt (51%) or because they are not sure that the worst of the recession is behind us (48%).
[Among those spending less] Why do you anticipate spending less this holiday season? Please select all that apply. Income <40K Income 40-70K Income 70K+

All

Male

Fem

I am trying to get out of debt I am not sure that the worst of the recession is behind us We instituted a cap on gift costs this year I lost my job I am fearful of losing my job Unlike last year, I am not planning to travel this year I am fearful of my family members losing their jobs I am anxious about my investments Other

51 48 25 18 11 10 9 7 16

54 58 23 18 14 8 9 9 11

48 39 28 18 9 11 9 5 21

47 44 17 25 8 7 5 4 13

54 50 29 16 14 11 11 4 16

51 53 37 9 14 14 13 12 17

Online Shopping Gains, Though Retailers Keeps Pace on Deals

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37% of consumers say that they will be shopping online more this year a 7% increase over last year. And the strength of online shopping is not based entirely on price advantages, as 51% continue to say that they will find better deals in a store rather than online. (Online retailers can take heart in the fact that 59% of respondents aged 30-39 say that theyll find better deals on the Internet). Nevertheless, 62% of consumers plan to shop at retail stores about the same amount they did last year.
Compared to last year, do you plan to do each of the following more, less, or the same amount? (Ranked by % saying more) Buy discounted items Use coupons Shop online Use cash to buy gifts Shop at outlets or discount stores (e.g. Ross, TJ Maxx, Loehmanns, etc) Shop at retail stores Take advantage of special programs such as layaway or 0% interest Use credit cards to buy gifts MORE LESS ABOUT THE SAME

2010

2009

Change

2010

2009

Change

2010

2009

Change

51 47 37 33 24 16 15

53 50 30 37 28 19 22

-2 -3 +7 -4 -4 -3 -7

7 12 20 15 25 22 38

7 9 22 15 24 23 28

0 +3 -2 0 +1 -1 +10

43 41 43 52 51 62 47

40 40 48 48 47 59 50

+3 +1 -5 +4 +4 +3 -3

13

14

-1

45

48

-3

42

38

+4

Thinking about this holiday season, do you think you will find the best deals In a store, not online Online

2010

2009

Change

18- 29

30- 39

40- 49

50- 65

Male

Female

Income <40K

Income 40-70K

Income 70K+

51 49

51 49

0 0

51 49

41 59

49 51

58 42

45 55

56 44

51 49

52 48

46 54

Some brick-and-mortar retailers are showing some growth, as well. 7% more consumers plan to shop at Target this year than did so last year. Furthermore, the online retail market may be diversifying despite the increase in consumer intent to shop online this year, many fewer consumers are planning to shop at Amazon.com. However, current Amazon.com shoppers are increasing in intensity 34% of respondents who shopped there last year plan to do so more this year.
Do you plan to shop at any of the following stores this holiday season? Please select all that apply.
Wal-Mart

2010

2009

Change

Male

Female

Income <40K

Income 40-70K

Income 70K+

55

63

-8

49

60

60

57

45

PENN SCHOEN AND BERLAND ASSOCIATES LLC.

Target Amazon.com Best Buy Kohls

42 36 27 26

35 47 28 23

+7 -11 -1 +3

34 35 30 22

51 36 25 31

37 32 22 15

44 38 27 33

47 40 35 33

Compared to last year, do you plan to do each of the following more, less, or the same amount? (Ranked by % saying more) Amazon.com Wal-Mart Target Dollar Store Kohl's

MORE

LESS

ABOUT THE SAME

2010

2009

Change

2010

2009

Change

2010

2009

Change

34 25 18 18 15

31 29 18 27 13

3 -4 0 -9 2

21 19 25 24 30

19 18 28 20 31

2 1 -3 4 -1

55 57 58 56 46

50 53 54 53 56

5 4 4 3 -10

The Rise of Social Shopping

Perhaps the most important trend affecting this holiday shopping season is the rise of social shopping, particularly in the under-40 demographics. 72% of consumers have created an account on social media, including 79% of 30-39 year olds. And a quarter of all respondents are following brands on social media, including 38% of 30-39 year olds and 31% of 18-29 year olds. Social media networks are increasingly integrated into consumers shopping behaviors, as well. This holiday, 24% of social media users say they will make a purchase decision based on a recommendation they receive from friends or family through a social media network including 34% of 30-39 year olds and 30% of 18-29 year olds.
Have you ever created an account on a social media network (such as Facebook, MySpace, LinkedIn, Twitter)? Yes No Dont know

All

Male

Fem

18- 29

30- 39

40- 49

50- 65

Income <40K

Income 40-70K

Income 70K+

72 25 3

68 28 4

76 23 2

80 14 6

79 19 1

73 25 2

58 41 1

74 23 4

70 29 1

73 25 2

Do you follow any brands on social media

All

Male

Fem

18- 29

30- 39

40- 49

50- 65

Income

Income

Income

PENN SCHOEN AND BERLAND ASSOCIATES LLC.

networks? Yes No Dont know

<40K

40-70K

70K+

26 69 5

25 70 5

26 69 5

31 60 9

38 60 3

23 73 4

14 83 3

25 68 6

25 72 3

28 68 4

[Among social media account holders] Thinking specifically about this holiday season, do you think you will make purchase decisions based on recommendations you receive from friends and family on a social media network? Yes No Dont know

All

Male

Fem

18- 29

30- 39

40- 49

50- 65

Income <40K

Income 40-70K

Income 70K+

24 52 23

23 58 19

25 47 28

30 46 24

34 46 20

18 56 27

14 63 23

25 54 21

23 56 22

26 49 25

What Americans are Planning to Buy

Gift certificates, clothing and toys remain the three most popular gift categories, though spending for all has slipped slightly from last year. Gift Planning Gift certificates/ Gift cards Clothing and accessories Toys Video games DVDs/Blu-ray Discs Books Cash Jewelry Music Consumer electronics (e.g. TV, iPod, etc)
2010 2009
Change Planned Spend

50 47 40 33 31 28 28 23 22 21

49 50 46 32 34 30 30 24 24 20

+1 -3 -6 +1 -3 -2 -2 -1 -2 +1

71.7 75.1 53.9 29.9 22 16.4 54.7 35.3 14.6 52.6

PENN SCHOEN AND BERLAND ASSOCIATES LLC.

Health and beauty products Computer or computer products Items for the home or garden Wine/Liquor Tools Sports and outdoor equipment Flowers/Gift baskets Movie theater tickets/memberships Charitable donations Magazine subscriptions

19 15 15 14 11 11 9 9 7 5

24 16 13 17 14 11 13 12 8 6

-5 -1 +2 -3 -3 0 -4 -3 -1 -1

16.6 32.7 16.3 14.6 13 12.9 9.56 7.21 15.7 3.11

Consumers are nevertheless still happy to get what they give, as cash, gift certificates and clothing/accessories top the list of gifts respondents would most like to receive. Consumers are also increasingly interested in receiving electronics as gifts 17% say electronics are on their wish list this year, 5% more than last year. What do you want for Christmas this year? Top 5 shown. Cash Gift certificates/ Gift cards
Clothing and accessories Books Consumer electronics (e.g. TV, iPod, etc)

2010 57 30 26 18 17

2009 60 29 26 19 12

Male -3 +1 0 -1 +5

Fem 60 24 18 12 14

Income <40K 54 36 35 18 15

Income 40-70K 64 32 26 17 15

Income 70K+ 54 30 25 18 20

Apple continues to be a buzz brand in the computer space this year 40% of consumers who intend to purchase a new computer say they are considering Apple, a 12% increase over last year. And 12% of respondents who are planning to buy consumer electronics this year say that a tablet device such as an iPad or Blackberry Playbook is on their list, a strong showing for a category that didnt really exist in 2009.

[Among computer intenders] What brands are you considering? Top 5 shown.
Dell Apple

2010 53 40

2009 57 24

Change -4 +16

Male 51 27

Fem 56 61

Income <40K 39 45

Income 40-70K 67 24

Income 70K+ 51 51

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Hewlett-Packard Toshiba Sony

30 30 29

54 18 27

-24 12 +2

20 16 28

46 51 30

36 49 41

25 10 22

34 40 30

Americans Know Whos Bad or Good

Sandra Bullock and Taylor Swift remain Americas Sweethearts, topping the nice list for the second consecutive year. On the naughty side of things, Tiger Woods and Mel Gibson ride their turbulent 2010s into placements near the top of the list of celebrities respondents think deserve a lump of coal. NICE LIST
Sandra Bullock Taylor Swift Angelina Jolie Beyonce Conan O'Brien Katy Perry Bret Michaels Jay Leno Jon Stewart Leann Rimes

All 55 40 30 27 21 18 17 17 16 16

Top 10 Male 47 35 31 23 25 15 16 20 21 17

NAUGHTY LIST Fem 62 45 30 30 17 21 19 15 12 15

Real Housewives of New York City Real Housewives of New Jersey Real Housewives of Orange County Brett Favre Real Housewives of Atlanta Britney Spears Tiger Woods Lindsay Lohan Mel Gibson Kanye West

All 67 51 48 45 39 38 38 37 34 33

Top 10 Male Fem 60 73 45 45 41 35 34 35 42 31 32 56 50 49 42 42 41 31 38 35

Want more?
PSBs Holiday Spending Survey contains detailed information about Americans gift giving plans for the 2010 season. More detailed information is available for the following categories Clothing & Accessories Computers Consumer Electronics Gift Certificates Health & Beauty Movies Music Toys

Please contact Dave Hughes at dhughes@ps-b.com or (646) 981-1486 to learn more.

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