Reports

CivicScience Reports: Use Cases for Our Real-Time, Deep Consumer Insights

Consumers and Money

/ By CivicScience

This CivicScience InsightStore™ report uses data collected through our intelligent online polling methodology and data analytics to showcase some highlights across three aspects of consumers and their money practices in aggregate:

  1. Their general personal financial situations
  2. Their general economic attitudes
  3. Their retail banking practices

Some of the data are comparative over time periods, and some data analyze consumers responding to research questions in the past year.

Money is something we can all relate to: earning it, saving it, spending it, and generally fretting about it. This report sheds more light on consumers beyond top-line polling results, by revealing some attributes to which marketers should pay attention. It also occasionally tosses in interesting, unexpected findings that may provide entertainment value.


The General Financial Situations of U.S. Adults

Self-assessments of how well online U.S. adults say they’re managing their money has not changed much in the past year (other than a very slight 2% increase in those saying they manage their money badly).

manage-money

Good Money Management and Savings Practices Go Hand-in-Hand: Those who manage their money “very well” are 126% more likely than average to say they save more than 20% of their income each month on average. Those who manage their money “badly” are more than 55% more likely than average to save 0% of their income per month on average.

Good Money Managers are More Decisive: Those who manage their money “very well” are 15% more likely than average to say they typically make decisions quickly and confidently.

A Social Media Link: Perhaps poor money management indicates that someone is not currently earning and therefore has more time on their hands for extensive web surfing. Our data finds that poorer money management admissions correlate strongly to more hours per week listening to music online. Those who say they manage their money “badly” are 72% more likely to view music on YouTube more than 15 hours per week (that’s an average of over 2 hours per day), while those who say they manage their money “very well” are 16% more likely than average to never use YouTube for music consumption.

(We’re not trying to pick on YouTube here, but just sharing what ranked high in our findings.)

Most Americans Try to Save at Least Something…

Less than one-third of online U.S. adults say they save none of their income in an average month, which would include those who are unemployed, retired, or still in school.

The great news is that the majority of Americans try to save at least a little of their earnings each month:

percentage-income-save-average-month-including-retirement-savings

No surprise that higher savings amounts correlate perfectly with higher income levels, with those earning over $100,000 per year finding it easier and roomier to bank more:

percentage-income-save-average-month-including-retirement-savings-expected

Yet despite these efforts to save, the majority of online U.S. adults polled (61%) have less than $25,000 or no  “liquid” (accessible) money banked:

describes-current-liquid-investable-assets-money-bank-investment-accounts

Spenders vs. Savers: Our market research asked consumers to self-classify as “spendthrifts” (having difficulty controlling their spending) or “tightwads” (having difficulty spending) or neither. The splits are fairly equal, with slightly more falling into the tightwad end of the spectrum:

spending-patterns-fits

What makes the spendthrifts and tightwads different?

It might surprise many that the gender split here is not very different than that of the general U.S. adult population, with spendthrifts only 8% more likely to be female.

Spendthrifts are 126% more likely than average to say they manage their money very badly, and they’re 25% more likely than average to spend a gift of money vs. save it.

As you might guess, spendthrifts tend to place more value on brand and tightwads on price. Self-described tightwads are 32% more likely than average to say they never splurge on themselves. But when spendthrifts splurge on themselves, they are 79% more likely than average to purchase a luxury designer product.

In addition, spendthrifts are 83% more likely than average to very closely follow fashion trends. When it comes to media, they are 43% more likely than average to say TV shows are a passion of theirs.

Fun fact: Spendthrifts are 54% more likely than average to “love” Leonardo DiCaprio, while tightwads are 18% more likely to not like him.

Economic Sentiment Among U.S. Adults

In partnership with Hamilton Place Strategies, CivicScience maintains an active tracker on consumer confidence regarding major economic indicators, such as personal finance, job outlook, major purchases, and more. The HPS-CivicScience Economic Sentiment Index is a “living” index with the goal of accurately measuring movements in overall national economic sentiment, and to provide a richer and real-time alternative to existing economic sentiment indices.

You can track our ongoing Economic Sentiment Index at http://hps-civicscience.com, but here are some of the recent highlights:

Consumer confidence in 2015 overall saw declines, following a sharp increase in general confidence during the 2014 holiday season at which time gas prices also fell:

EconomicSentiment_Dec12015_chart1

In the past year, confidence in the overall U.S. economy has declined the most, from its 12-month high of 51.1 to 38.5 in early December. Three of the other indicators also saw drops: confidence in the housing market; confidence in making a major purchase; and confidence in finding a new jobPersonal finance confidence fell slightly, but not as dramatically as the other indicators:

EconomicSentiment_Dec12015_chart2

About half of online U.S. adults polled try to keep up at least a little bit with economic and financial news: 54% of 36,444 U.S. adults told CivicScience in the past year that they follow trends and information at least some of the time.

Those who follow financial news very closely are:

  • Well-traveled: They’re 119% more likely to have been to 41 or more American states.
  • 118% more likely than average to “love” Labatt Blue beer.
  • 81% more likely than average to “love” Lincoln cars.
  • 38% more likely to describe their political leanings as Conservative.

Retail Banking Practices

Thanks to the proliferation of smart phones and other mobile devices, retail banks have been able to use web-based apps to extend convenience benefits to their customers.

Online banking today is widely used: 75% of 14,960 online U.S. adults polled by CivicScience from September 1 to November 29, 2015 said they use online banking features at least a little. The “power users” make up 52% who go online for at last half of their retail banking. This number grew by 4% over the same period in 2014.

Mobile banking: Banking through one’s mobile device, however, has been slower to catch on among the general public. Our data shows that smartphone usage has increased by about 7% in the past year, to reach a rate that’s now around 68% among U.S. adults (Pew Research Center has near-identical findings). Yet, fewer than half of U.S. adults conduct some of their retail banking through such a device, and only 20% conduct more than half of their retail banking in this way.

Mobile_Online_Banking

Banking Super-Customers: Certain consumers conduct their personal banking with more than one institution, and they make up about one-third of U.S. adults – and about 10% of all online U.S. adults indicate that they have accounts with three or more banks:

retail-banks-accounts (1)

Those using multiple retail banks have more money to manage. They are about 30% more likely than average to have an annual household income that’s $100,000 or higher, and they are over 20% more likely than average to save at least 11% of their monthly income on average. Those using multiple retail banks are 32% more likely than average to pay for healthcare insurance themselves.

Those who currently have no bank are 101% more likely than average to drive a coupe style vehicle. They are 109% more likely than average to have no healthcare insurance. They are 50% more likely than average to rarely or never vote in any level of government elections.

“Winnable” Banking Customers

A big challenge for those engaged in retail/consumer banking and financial services is the difficulty in getting existing bank customers to make a switch to their brand (or add their brand to the mix). By and large, banks are seen by consumers as offering fairly standardized and non-differentiated services, and there is rarely a compelling reason or driver to make a switch.

That said, retail banks and financial services firms may be pleased to know that about 1 in 10 U.S. adults might be willing to consider a switch.  Among 10,451 online U.S. adults asked from October 13 to December 2, 2015, CivicScience found that 7% would be somewhat likely to switch banks in the next three months and 3% said they’re very likely to make a change.

Grouping those “very likely” and “somewhat likely” respondents, here are some more insights about them that might provide use for marketing and advertising plans:

  • They are 33% more likely than average to have an annual household income over $100,000.
  • They are 61% more likely than average to describe their political leanings as “Conservative.”
  • There is no gender difference relative to the general population.
  • They are more likely than average to be “second screeners” as they are watching shows or movies on TV – meaning they are using a smaller digital device (smartphone, tablet) at the same time they have programming on the TV.
  • Possible bank switchers tend to get their holiday shopping done earlier than average. They were 226% more likely to say they were already “done” with their holiday shopping by December 1, 2015.
  • Possible bank switchers are 114% more likely than average to love shopping at Best Buy.
  • Fun fact: Possible bank switchers are 33% more likely than average to be more talkative in their work and social life.

This report provides a collection of consumer money practices and sentiment insights to paint a broad picture of personal finances among U.S. adults. (It does not aim to cover every aspect; not included here are many attributes in the CivicScience InsightStore™ related to investments and retirement planning, digital wallets, and fraud protection concerns, for example.)

As you can see, despite overall economic confidence falling steadily throughout 2015, it doesn’t seem to be changing consumers’ behavior in terms of savings volumes or money management improvements; we saw no notable differences in those areas over the past year. We do however observe increased usage of online apps for handling banking transactions. For banks looking to attract switchers (or to lure those consumers currently not using a bank), trumping up those tech-enabled convenience features, as well as any services that can help them better manage their finances, may be smart marketing.

For more information about any of the data in this report, or to explore more data we have on this topic, please contact us: contact@civicscience.com

See what insights we have about your organization

Chat with someone from the CivicScience team and let us know how we can help you.

Sign up to receive a recap from the blog