Though the economy has recovered from the economic woes of the most recent recession, that period changed how Americans shopped.
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In some cases we're a more careful nation with many of us being aware that just because the good times are rolling does not mean it has to stay that way forever. With its report"How America Shops Now,"Consumer Reports detailed some of these changes and found a changed but defiant nation.
"The Great Recessionthat started in late 2007 turned the American shopper -- famous for our free-spending ways -- into the American scrimper," wrote CR."Thanks to the downturn we've been buying less of everything from housing to haircuts, driving our cars till they drop, and putting off big life moments such as getting married and having babies."
That's true and despite the recovery the consumer affairs magazine found that only seven in 10 people now feel they have enough money to make purchases they have put off. And even those who are doing fine now are still more cautious than they were in the past.
"People have just been traumatized," Rutgers Public Policy Professor Carl Van Horn, who is the director of the John J. Heldrich Center for Workforce Development, and author of the book, Working Scared (or Not at All), toldCR."They're still struggling, worried, and anxious. Even though they're working, they don't believe their jobs are stable, they fear layoffs, and there's a sense of impermanence."
But no matter how frightened people are or how bad things got for them, a shockingly high percentage of people won't give up pay television regardless of how bad the economy gets.
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The survey found that 38% of Americans would find a way to pay for premium, streaming, or pay TV "no matter what the economy does." That's well ahead of the 17% who would not give up paying for haircuts and the 11% each who said they would find a way to pay for cigarettes orStarbucks/Dunkin' Donuts.
Consumer Reportsexplained the results of the question more fully in the report, saying that while Americans were willing to put off buying a house and forego vacations, there were some things they could not let go of.
Our survey found that Americans hold tightest toat-home entertainment: When asked, "What is thelast thing you would cut back on in order to economize?"38% of people said they'd never ditchpay television, including premium cable, satellite,and streaming services like Netflix and Hulu.
What's perhaps most interesting is that pay TV, which was once seen as a luxury item, has become a necessity for many. In fact, when you look at the broader results of the survey, you find that nearly 80% of Americans would go without a lot of things before getting rid of their paid TV fix.
More than one in 10 Americanstold Consumer Reportsthat their Starbucks/Dunkin'Donuts habit would be the lastthing they'd cut back on.Coffee's addictive qualities arelegendary, but who knew weare even more hooked on payTV? Almost four of five peoplesaid they'd be extremely reluctantto drop pay television,including premium cable, satellite,and streaming servicessuch as Netflix and Hulu.
Cornell University marketingprofessor Brian Wansink explained part of the logic behind why, even in poor economic times, people cling to cable (and coffee)'
"Whether I'mspringing $4 a day for coffee or$1.33 a day for pay TV, it's reallynot much to justify," Wansinktold CR. "It's a small enoughamount that doesn't add up inour internal calculus. I can say 'I
deserve it,' and nobody is goingto complain that I'm overindulgingas they might if I go out tothe movies or a fancy restaurant."
When you break it down by what it costs each day even services likeComcast's seem like affordable indulgences. Source: Comcast
It's not all good news for cable
While people are not willing to give up pay television even when facing tough economic times, they have shown a willingness to cut back or even swap cable for paid streaming services. Still, cord-cutting numbers have been relatively small with cable only losing about .2% of its customers over the last two years according to a report fromLeichtman Research Group.
That's a tiny amount especially when you see that enhanced caution about spending was a recurring theme cited by people in theConsumer Reportssurvey. In fact, despite that new sense of budgetary care, 29% of people surveyed actually said they expect to spend more on TV service in 2015.
Cable and other pay services have become something beyond status symbols. It's almost odd if you don't have some sort of paid television perhaps even multiple sources. Cable may not be chemically addictive like coffee or cigarettes, but it clearly has become its own kind of addiction.
The article Some Americans Won't Give Up Cable No Matter What the Economy Does originally appeared on Fool.com.
Daniel Kline owns shares of Apple. He would be very unlikely to give up cable or coffee. The Motley Fool recommends Apple, Google (A shares), Google (C shares), Netflix, and Starbucks. The Motley Fool owns shares of Apple, Google (A shares), Google (C shares), Netflix, and Starbucks. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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