Consumer Confidence May Be Down, but Discretionary Spending is Up
City-Specific Spending Data Shows San Francisco Led Regional Spending; Ultra-Affluent Spent More on Cruises, Quick Service Restaurants in Second Quarter
American Express Business Insights today launched its series of Q2 2010 Business Insights Spend Trends reports, which analyze changing patterns in spending across various categories, US cities and consumer groups. Based on actual aggregated spending information between April 1 and June 30, 2010, the Business InsightsSpend Trends reports reveal a cross-section of notable spending trends across core sectors such as travel, dining and entertainment, and luxury retail during the second quarter of 2010 versus the second quarter of 2009. The four reports are:
“Tapping into actual consumer spending patterns creates an opportunity to identify - and even predict - trends that may not be apparent from a single merchant’s perspective”
- Q2 2010 Spend Trends Report: Regional
- Q2 2010 Spend Trends Report: Travel
- Q2 2010 Spend Trends Report: Luxury Retail
- Q2 2010 Spend Trends Report: Dining & Entertainment
A Snapshot into Actual Consumer and Business Spending
The Business Insights Spend Trends reports provide a snapshot into the group’s in-depth analytical capabilities on US consumer and business spending across sectors that serve as key economic bellwethers. In identifying spending patterns of specific demographics, companies may gain insight into how emerging trends may impact their businesses. Small and large business spending was also analyzed in some of the reports, and lends insight into how corporate spending has been impacted by the recession and recovery period to date. Providing both off-the-shelf and highly customized consumer spending reports, American Express Business Insights created the quarterly Spend Trends series to serve as a sampling of data that they can provide to businesses and marketers as they look for opportunities to help grow their businesses and target their best customers.
Data Highlights: Data Shows Sector, Regional Spending Surprises
Luxury Retail Report:
Despite the threat of a double-dip recession, luxury retail merchants received good news in the second quarter. According to the American Express Business Insights Q2 2010 Spend Trends Report: Luxury Retail, spending increased by at least 9% in each luxury retail category analyzed: furniture and home furnishings; apparel and accessories; jewelry; and department stores. Home furnishings performed the strongest - despite a weak housing market - suggesting that homeowners are focusing on their current interiors until the real estate market improves.
Dining and Entertainment Report:
In the Q2 2010 Spend Trends Report: Dining & Entertainment, American Express Business Insights reveals that ultra-affluent consumers nationwide increased spending in quick service restaurants by 24%, compared to a 12% increase for this group in fine dining spending. When compared to smaller spending increases in other categories, it is interesting for the food and beverage industry to note that less expensive restaurants have caught the attention of this particular consumer group.
Travel Report:
The travel sector showed some surprising trends, with the airline industry experiencing an extreme shift in preferred ticket classification. The Q2 2010 Spend Trends Report: Travelillustrates that business class airfare saw an overall 63% increase in spending by US consumers, with the ultra-affluent group spending 114% more on the front of the plane during the second quarter of 2010 over the year prior. Spend on first class tickets saw no increase year-over-year. Airlines might consider how to leverage this dramatic shift in preference as we head into the holiday travel season.
Regional Report:
The Q2 2010 Spend Trends Report: Regional data revealed that several cities saw spending increases year-over-year for the second quarter in a broad group of categories, such as lodging, airline, travel, luxury apparel, housewares and furniture. Most notably, the city of San Francisco as a whole increased overall spend by 36% across all categories, higher than Chicago, Los Angeles and Miami. With New York City posting a slight decrease in overall spend at -3%, local businesses may want to think about innovative ways to reach their customers to increase spend.
“Tapping into actual consumer spending patterns creates an opportunity to identify - and even predict - trends that may not be apparent from a single merchant’s perspective,” said Ed Jay, Senior Vice President at American Express Business Insights. “The latest Spend Trends data shows that while consumers and businesses are holding fast to their wallets and expense accounts, there are certain categories and regions that are seeing very positive growth. This is extremely valuable data for companies looking to identify where consumer and business money is being allocated in such a tight economy,” he added.
About American Express Business Insights
American Express is a global services company, providing customers with access to products, insights and experiences that enrich lives and build business success.
As part of the Global Merchant Services organization within American Express Company, American Express Business Insights provides in-depth, actionable insights into consumer and business spending at the business, industry and geographic levels, leveraging proprietary transaction data from the American Express network of approximately 90 million cards in force across over 125 markets.
American Express Business Insights produces in-depth quarterly reports for the Airline, Car Rental, Cruise, Lodging, Restaurant, Entertainment and various Luxury Retail categories, as well as sector-specific geographic reports. These full-length Industry IQ reports are available for purchase at www.americanexpress.com/businessinsights.
About the Q2 2010 Spend Trends Reports from American Express Business Insights
To identify changing spending habits across various regions, American Express Business Insights examined US consumer and business spending patterns at tens of thousands of merchants. The data shown in the reports are derived from transactions on the American Express payment network projected to reflect the general population in the industry, consumer and business segments shown. The data do not represent American Express’s own performance in the industry segments shown and do not represent the spending behavior of American Express Cardmembers overall or in any particular cardmember segment.
