If you’re one of our clients or you’ve been in the audience for my stump speech recently, you’ve probably seen this:

That’s our Economic Sentiment Index – since 2014 – comparing Republicans and Democrats. It’s worth a thousand words. 

Consumer confidence today is only partially a measure of real financial health. It’s also an indicator of hope, fear, and whatever level of trust people have in the current political leadership. That nuance is lost in the aggregate, but when you see it cut like this, it’s stunning.  

There’s a reason we give our topline ESI numbers away for free. 

For sure, they’re a useful indicator. And ours are far better than the old school consumer confidence metrics because they’re faster, the sample sizes are much larger, and our methodology is stronger. We like showing that off. 

But the magic is in the underlying analysis, based on the thousands of different things we know about the people who answer the questions. America isn’t a monolith, yet economists, policymakers, and business leaders obsess over headline numbers. We don’t do that here, because we don’t have to. 

And because it’s misguided. 

Your customers are not the entire U.S. population. They’re a select group, defined by a particular set of demographics, life circumstances, emotions, and interests. And they’re changing constantly. 

Of the dozens of retailers we track, Cabela’s customers are the most likely to be “very concerned” (77%) about inflation, compared to 59% of the full U.S. population. Whole Foods customers are the least (45%). Macy’s is in the middle. Income is a factor, but not as much as the political psychographics of the people who shop there. 

And because inflationary concerns affect spending and price sensitivity, each of these retailers should think differently, forecast differently, and market differently – at least until things change (and they will). 

Mitsubishi drivers are the most likely of all auto brands to have student loans – and now they have an extra $10k to make a down payment on a new car. In apparel, Hot Topic customers are the most likely to have student debt, which could pinch when (if?) loan payments return. Pepsi drinkers have the lowest incidence of student debt in the CPG category. 

And I’ll bet you none of those brands know that. How could they?

Nobody’s ever been able to track all this stuff before.

Here’s what we’re seeing:  

Speaking of our Economic Sentiment Index, it climbed over the past two weeks. I was fairly certain consumer confidence had finally reached its low-point in June, especially when it vaulted upward for a solid month in July. Then the numbers softened slightly in early August – only to end the month on a positive note. Optimism around the job market is the biggest driver of the lift, even though the blazing job numbers seem to be spooking Wall Street, based on fears of steeper interest rate hikes. Whatever. Consumers are less spooked, which is a good thing as the holiday retail season nears. 

 

Fully remote workers are the least happy in their current jobs. As if the Internet wasn’t annoying enough, now we have to deal with the zeitgeist around so-called “quiet quitting,” which is basically people saying they’re no longer going above and beyond at work. Good luck with that. Twelve percent of U.S. workers say they’re already doing it and 6% say they’re planning to – which all should bode incredibly well for the other 82%. By far the most interesting stat from this state-of-work study is captured in the headline above and the chart below. Is it because people who work from home are less happy or because people who are unhappy at their jobs are more eager to stay home? You tell me. 

People are getting booster fatigue. Over one-third of Americans say they are less likely to get a new upcoming COVID booster than they were to get the previous one(s). Ironically, healthier people are more likely to get it. One possible contributor to decreased booster intent is a noticeable decline in trust of the CDC since the beginning of the year. But, like I rambled on about in the prologue, these numbers don’t land evenly across the board. 

Cryptocurrency has definitely hit a plateau – and possibly a peak. After staggering growth throughout 2020 and 2021, the popularity of crypto slowed considerably in the first half of this year – due obviously to the rapid decline in its value. Nearly half of U.S. adults who pay close attention to the financial markets believe the crypto market has reached its peak (I’m more of the mindset that it’s a temporary plateau, for however long). Avid crypto investors want to use it for everything from earning credit card rewards to purchasing products. Everyone else is skeptical, due in large part to persistent concerns about privacy and security.

Holiday retail will be a mixed bag. Too early to call, you say? Bah Humbug! I’m going out on a limb and predicting holiday spending is going to be up – if modestly – due primarily to higher prices. Our current numbers say a larger share of Americans will spend less, compared to those who say they’ll spend more. But, like the past few months (and years), the people who spend more (higher income) will spend more than the people who spend less (lower income) will spend less. Make sense? In-store shopping will have a 2019-like renaissance too, so long as COVID doesn’t do anything crazy. The BIG question (for mere mortals, anyway) is what category and brand trade-offs consumers will make to stretch their dollar. Hit me up for the answers. 


Advertisers are the only thing that can save media – and save us from it. The guest on my podcast this week was the great John Battelle, one of the founders of Wired magazine back in the day and the brains behind one of my favorite emerging news platforms – The Recount. We went super deep on the state of media today, the future of privacy, the good and bad of algorithms, and how brands need to step up to fix the mess.  


A few more awesome studies this week:

The most popular questions this week:
 


Answer Key: Tropical without question; Pro by a lot; They’re all the same; My last name is Dick, what do you think?; I honestly love it.

I hope you have a fun, relaxing, or whatever you consider a perfect holiday weekend.

JD


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