High-Income Shoppers Slashed Spending Most Over The Holidays

Hitwise has just released a brief report examining the spending habits for web users over the holiday season. Using traffic data from its Retail 500 index, the site found that traffic in 2008 was lower than it was last year, but was (perhaps surprisingly) higher than it was back in 2006.

The study also found that the biggest drop off in traffic was among shoppers that fell under the ‘high-income’ demographic, which is classified as households earning more than $150,000 per year. Traffic from these upper-class buyers dropped 12.33% comparing December 2007 to December 2008, versus a drop of around 1% for those making less than $30,000 a year and an increase in traffic from everyone else. The report doesn’t make any guesses as to why this happened (perhaps the more wealthy users were losing more money in the stock market?), but it’s an interesting trend nonetheless.

Finally, the report says that the trends toward lowered traffic reversed in the days immediately following Christmas as shoppers looked for deals. This was especially pronounced at “luxury retailers”, who may have been forced to slash prices more viciously in light of the economic climate.

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Comments

[User 68127:]

It is not that hard to figure out! Those who make $30k per year basically spend every penny just on non-discretionary living expenses--there is little ability to cut since they are already maxed out.

Those that make $150k+ who formerly spent it all have a lot of leeway to cut before reaching the necessities. The daily Starbucks, eating out, the expensive vacation, that fourth cashmere sweater, the nanny, the botox treatment, the club membership....

2008 Dec 31 12:42 PM

[SteveTheHawk:]

Very true 68127. In addition, many of them are probably freaking out over the drop in value of their McMansion and 401K. They no longer feel warm and fuzzy about their finances.

Jan 01 10:04 AM