This post originally appeared on The Jane Dough.
It’s no surprise that in a thriving economy, consumers don’t watch their spending and budget as closely. They splurge on things such as getting their hair done frequently, taking vacations, and redecorating their home.
When the economy took a turn for the worst, consumers cut back on those extra expenses and became determined to save on daily expenses such as grocery shopping and gas.
Take a look at how the economy has influenced consumer behavior and how businesses have suffered.
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Stealing Toilet Paper
You might guess that in tough economic times, people resort to stealing. I bet you didn’t realize that during these times, people tend to steal unusual items. The following are a few examples of the strange things people steal in an economic downturn:
Brass and Copper
Typically, scavengers are the only people that look for brass and copper, but there is a rise in these type of thefts during a bad economy.
According to the American Kennel Club, 49 percent more dogs were stolen in the beginning of 2011 than any previous years, which was around the time the U.S. economy was at its worst. Apparently, people still want to own pets, they just don’t want to pay for them. Just for the record, if you steal my dog, I will come after you!
Like it or not, there are certain things people can’t live without, such as toilet paper and feminine hygiene products. While this may seem ridiculous, Justin Rohrlich reports that $60,000 worth of items including toilet paper and plastic utensils were stolen from a warehouse in Georgia.
Unfortunately, business owners who suffered a decrease in business now have to worry about petty theft as well. I have noticed restaurants and local boutiques paying extra attention to their customers and putting up more signs in order to deter people from stealing. Yes, people are more likely to steal items they can sell for money, but when the economy is bad, they will steal the everyday necessities as well.
Saving Money by Spending Money
Consumers buy items they believe will help them save money in the long run. Even though the product costs more initially, they justify the purchase by reminding themselves how much money they will save in the future.
Utility bills have been rising steadily since 2008; hurting homeowners’ pocketbooks. Therefore, people buy energy-efficient appliances in order to try and combat utility prices.
Pregnancy Prevention Products
It costs a lot of money to go through a pregnancy, not to mention the thousands of dollars it costs to raise kids. Women who are scared of adding the expense of children to their lives prevent pregnancy by purchasing contraceptive methods.
Home Security Systems
Homeowners are always concerned about home security, but especially when the economy is going through a rough time. They can’t bear the thought of someone stealing their precious belongings when they have already cut back on expenses, so they install a security system. Security companies such as select home security have experienced an incredible increase in sales since 2006.
This means that companies who sell items that save consumers money have an advantage in this market and they should take advantage of it. Now is the time to appeal to that kind of buyer and provide them with a solution. They still have money to spend, but they are going to be picky on what they spend their money on, so you must show the value of your product.
Hawaii Will Have to Wait
A bad economy can be detrimental to everyday life. People lose the bare necessities of survival, such as food and shelter. Others continue living their lifestyle, but avoid these things because they cannot afford them:
Taking a Vacation
Vacations are luxuries, which is why they are one of the first things to go when budgeting. People don’t want to go into debt because of a vacation or financial difficulties. If they can afford a vacation, they choose to go up north for the weekend rather than a spending a week in Hawaii.
There is a 7% decrease in divorces rates since 2006. I have a few theories to explain this. Divorce is time-consuming and expensive and couples who experience financial hardship have decided to stick together and tough it out during these times.
Having Cosmetic Surgery
Elective surgeries always go down when the economy is bad because people get worried about spending the money, which also means that people go to their regular doctor less frequently. The health care crisis is a huge factor as well. Of course, celebrities will still get chin implants and nose jobs because they don’t need to budget like the average American.
Businesses who sell products that are considered luxuries rather than necessities will be challenged. I worked in a salon during the worst economic times, so I completely understand how difficult it can be to drive business. You may have to consider offering discounts during slower periods of business. I recommend utilizing partnerships with other local businesses in your industry, so you can mutually benefit each other during these times.
Have you observed changes in businesses, customer service, or consumer behavior? What about your own shopping habits?