Despite most economic indicators showing the US economy is in good shape by historical standards, consumer confidence has begun to dip once again, according to AP News.
Curious to understand the reasons behind this trend, we conducted a study that revealed that finances are a growing source of stress for most Americans. In fact, one-third of respondents rated their budget concerns as a 10 out of 10.
Given these circumstances, it's understandable that many are cutting back on spending. However, our research shows that there are certain areas where people are actually choosing to spend more.
Today, we'll analyze the findings from our latest research to explore how people are planning to save money and where they intend to splurge for the back half of 2024.
Saving & Splurging
Saving: Less time online, more time outside.
According to our data, 76% of people plan to enjoy some outdoor fitness activity at least once per week this summer. Many of the most popular planned activities were free, like swimming or hiking.
Interestingly, a not-so-small contingent of the population (30%) plans to actively spend less time on social media this summer.
These two stats together paint quite the picture.
With a looming US presidential election, wars, and sustained economic hardships, people are seeking quiet, reflective, and (sometimes) internet-free spaces to spend their time.
Studies show that spending as little as 20 minutes a day outside can reduce stress (National Recreation & Park Association). Doom scrolling on social media for 20 minutes will likely just spike your anxiety.
For brands and advertisers, this may lead to slower engagement throughout the end of summer and potentially into the fall as people look for an escape. This means every interaction with your audience must be intentional and impactful.
Splurging: Travel Experiences
As our summer travel report noted, 44% plan to travel this summer (35% are considering it).
Despite considerable concerns about their budgets, many people are actually planning to spend more on travel this summer. According to our research, 61% of consumers have kept tighter travel budgets in recent years, planning for $1000 or less per trip.
Now, 54% are budgeting in the $1k-$5k range, signifying significant growth in travel spending.
Why? Hilton's CFO & President of Global Development, Kevin Jacobs, had great insight into this inconsistency in Forbes 2024 Travel Trends:
"Even with ongoing macroeconomic uncertainty, travel demand has remained strong as consumers continue to prioritize the value of experiences and connections over things."
Much like time spent outdoors, travel also offers a unique way to spend more time in the moment and less on the internet.
Saving: Unnecessary spending
Throughout our study, we've seen that many are spending their summer doing things to better their mental health. Whether it's spending more time outdoors, traveling more often, or using social media less, people are trying to protect their peace this summer. And this will affect their spending.
Interestingly, Forrester predicted as much in their 2024 Predictions piece:
"….consumers will exercise better awareness and habits with their wallets, devices, and minds. As consumers strive for more calm in their lives, another storm will brew, spawned by three major world events: the Paris 2024 Summer Olympics, a US presidential election, and the campaign for the next UK general election."
The data clearly shows that people are indeed exercising better awareness and habits with their devices and minds. And unsurprisingly, they are also flexing more control over their wallets.
Moving forward, we can expect to see cuts on "unnecessary" spending. Only 33% of respondents in our study planned to shop for clothing items this summer, and nearly half (41%) were planning to limit their dining out to once per week.
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