New neccessities battle for consumer's dollar
Jerry Epperson -- Furniture Today, March 4, 2007
Sometimes we cannot explain our fascination with the consumer. The various services we subscribe to and pay to do original research give us insights that are very valuable.
For example, Americans now spend more money each year on dining away from home than on foods prepared at home. No wonder dining furniture sales are soft. For many, the dining room is their car.
Luxuries a couple of decades ago included air conditioning, microwave ovens, dishwashers and clothes dryers. Now they are considered necessities. But have you thought about the "new" necessities? When did every man, woman and child have to have a cell phone or a more elaborate personal communications device? I still remember using a "party-line!" (Ask your grandparents).
TV and radio used to be free but now we gladly pay for both — and cannot do without them.
Another necessity is a computer hook-up in the home so you don't have to use the slow phone lines. Imagine the shame.
Other current necessities include a second car, at least one high definition, preferably flat screen television and a current viable gaming system (preferably a Wii or PlayStation 3 but an Xbox or GameCube are acceptable if you are not very sociable).
What is a huge luxury today? Having a stay-at-home-parent! And that used to be the norm. In fact, two-parent homes are now the minority.
Why do you care? All these new "necessities" take money that we once could get a piece of — or at least we had a shot at. Listen to most furniture folks and they point to higher gas prices as the competition. We wish it was that simple.
In 2006, Americans spent $29 billion — yes, billion — on gift cards. Do you offer them? At a discount? You should. The experts say that $8 billion of those cards will expired unused. Admit it — you have let them expire, too.
Now here is a twist. Do you know either the traditional or modern wedding anniversary gifts? Shame on you. The closest we get is "wood" (fifth year) or leather (third year). Everything else imaginable is there but furniture or bedding. Believe it or not, paper, cotton, tin and wool have their own years. Tin?!? Along this same line, every other product has its own special week or month. This type stuff could be a lot stronger for us.
By the way, the National Retail Federation says January is the best month to buy furniture.
Finally, the current group of young folks (Generation Y, aged 11 to 29) is waiting until later to get married. The average age is now 26 for women and 27 for men and the trend will continue to get older. That means young couples are waiting later to commit to home purchases and having children, and we will have more young, single-person households. It also could mean fewer divorces in the future if you believe Dr. Laura.
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