Dive Brief:
- Apparel spending expectations are down 7% this spring compared to this past fall, though the category has seen a 13% increase during that time, according to a biannual report tracking consumer sentiment from Alvarez & Marsal.
- “The U.S. consumer is still punching” and “optimism is back in fashion,” Jonathan Sharp, lead report author and managing director at Alvarez & Marsal, said in a news release about the report. He urged retailers to “make hay while the sun shines,” because attitudes toward a recessionary slowdown remain cautious.
- Spending expectations on all four overall categories tracked in the report — basic needs, experiences, gifts and indulgences — are up for the first time since the report launched in 2021, although 42% of consumers still say they have strategically reduced apparel and footwear spending due to rising prices.
Dive Insight:
In an email, Sharp described apparel spending expectations as a "glass half empty, glass half full story." Although consumers are planning to spend less on this category, it moved the most in a positive direction out of the 19 individual categories examined.
He added that consumers are open to spending on certain budgetary items despite economic concerns.
“Keeping in mind consumers are still thinking about inflation expectations … the consumer seems to be compartmentalizing that, versus the last time we ran the survey six months ago,” he said.”They are now indicating they are willing to spend a little bit more on the things on which they’d previously cut back on substantially.”
The results suggest consumers may feel more stable than they did half a year ago.
“Taking this with the macroeconomic questions we’d put to them about having and saving more money, they're actually more positive, so at a meta level, when we ask them about indulgences and gifting and experiences, that's all moved positive.”
This is the fourth installment of Alvarez & Marsal’s report, which is based on a survey of over 1,500 U.S. adult consumers. The report addresses consumer behavior and shopping priorities by category, and addresses factors affecting purchasing decisions, such as the state of the economy and concerns over rising prices.
