Credit Card Companies Offer New Insight Into Consumer Spending

[Jul 25, 2007.]

 

The credit industry has uncovered some surprising news about consumer spending. Apparently, young people are going to become bigger spenders than their Baby Boomer parents.

A study by VISA USA found that the Echo Boomer generation will be leading the growth in many retail categories. In fact, customers between the ages of 18 and 28 will probably be outpacing their elders in spending for entertainment, restaurants, and travel. Echo Boomer spending may reach $2.45 trillion by the year 2015.

In sharp contrast, Baby Boomers will be spending their hard-earned income on medical expenses and family gifts. The results should probably not be that surprising, considering the fact that older Americans are more likely to focus on issues relating to health and family.

Yet, Echo Boomers appear to be taking a cue from family members, as far as spending is concerned. The study showed that young people are more likely to listen to the views of their parents, husbands, wives, and children, rather than their fellow Echo Boomers, when it comes to spending money.

If they had an opportunity to give a gift to themselves, Echo Boomers are most likely to give themselves a day off (35%). 22% would attend a concert or sports event; 15% would go out on the town; 13% would go to a spa; and 11% would purchase new clothes.

Why is such information important? Simply because it gives businesses an idea of how money is being spent by various age groups. That information becomes key in predicting future trends and developing effective marketing campaigns. The more businesses know about consumers, the better equipped they'll be to cater to consumer needs over the long term. And consumers will be happier, knowing that corporations are really listening to them and to their concerns.

Julie Ann Amos
July 25th 2007
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