Tailor your business to American spending habits
January 20, 2015

American's spending habits remain relatively unchanged. Despite an improving U.S. economy, which according to Bloomberg may lead to global financial growth, many individuals are continuing to spend money with an eye toward sales, coupons and good deals.

A frugal nation under debt
McKinsey and Company's U.S. Consumer Sentiment Survey indicated that the number of consumers who agreed or strongly agreed they were not purchasing certain items due to a lack of confidence in the economy decreased in September 2014 compared to the same month in 2013. However, an increased number of participants reported they felt as though they were living from one paycheck to the next and that their ability to make ends meet had decreased. For these reasons, many spenders are looking for ways to cut back on expenses. Some of these techniques include:

  • Buying value brands
  • Comparing prices
  • Shopping at mass merchants
  • Shopping at club stores

The advantage of implementing a loyalty program
It is import for merchants to build loyalty especially if consumers intend to spend less of their income. Accepting cash, debit and credit card payments allows customers to choose from a variety of payment options and is one way to increase satisfaction and encourage allegiance to your business.

Entrepreneur recommended that small businesses should also employ loyalty programs. These initiatives can help you encourage consumers to return to your business and ultimately increase your own profit. Instigate a loyalty card or utilize mobile devices to create cost-effective options for both you and your customers.

Offer consumers valuable, targeted discounts
Small Business Trends suggested offering quality and budget friendly products and services. Also incorporate discounts and sales that will encourage consumers to make purchases while still turning a profit.

In addition, consider your target audience before implementing a plan. Consider whether your customer base tends to spend more money due to higher income or if they tend to be more conservative with their spending patterns. While the Mckinsey Consumer Sentiment Survey indicated a general trend among Americans, your customers may be unique from the general population. Account for these types of variations when determining a plan for increasing your revenue.

For example, millennials tend to shop around and spend money on personal care, food and beverages. Tap into this mindset by advertising and catering to their demands. Consider marketing your goods as healthy or organic to appeal to this demographic.

A successful 2015 depends on your small business's ability to adapt to the new consumer. Make adjustments if necessary and ring in substantial profit simply by understanding your customers.

Nexus: G-WEBCD2