The eBillme Online Spending Index polled consumers to measure their projected online spending for the quarter and the factors that would influence their spending decisions. This quarter, the Index also surveyed consumers about projected Valentine’s Day spending in addition to the impact of the Obama administration on spending and consumer confidence.
The Index revealed that the new Obama administration has 50 percent of Americans feeling more confident in the economy. They are cautiously optimistic; their caution stemming from continuing uncertainty in the economy.
Consumers are projected to decrease online spending over the next 90 days to an average of $75 as compared to $175 during Q4. Further data shows a slight uptick in uncertainty with 55 percent of consumers reporting the delay of major purchases due to uncertainty in the economy as compared to 48 percent over the last 2 quarters. 25 percent say they will be increasing their everyday spending in the coming months.
With respect to Valentine’s Day spending:
- 11 percent of consumers are planning to spend more this Valentine’s Day as compared to last.
- 18 percent of consumers are planning to make their Valentine’s Day purchases online this year.
Bruce Cundiff, Director of Payments Research and Consulting for Javelin Strategy and Research
“Amid all of the economic gloom, there appears to be some optimism on the horizon. Fully half of consumers indicate more confidence in the economy as a result of the new administration. However, consumers will remain cautious and reliance on credit will continue to weaken. More financial responsibility towards everyday spending will be critical as we move forward and consumers adopt new spending habits to live within their means during this new era of personal responsibility.”
“It is not surprising that spending for Q1 is projected to reach a lower average than Q4 - Q1 is historically a low quarter in sales for retailers coming out of the holiday shopping season. Consumers are typically focused on paying bills and lowering any debt they acquired throughout Q4. This year, the strain of the economy and the credit crunch are impacting spending even further.”
Marwan Forzley, President and CEO, eBillme
“We are entering into a new era of responsibility. Evidence of the consumer shift from credit to cash has carried over from Q4 and our Index data shows that consumers are taking steps to spend with caution. While the online retail sector has been able to better withstand the effects of the economy, we are heading into a cycle where shopping responsibly will be on the mind of every consumer.”
The next Index will be released in April, 2009.
About the eBillme Online Spending Index
The Index is based on data collected from an online consumer survey deployed in August 2008, with a sample size of 1608 respondents. The survey targeted US adults (age 18 +) and was based on representative proportions of gender, ethnicity and income as compared to the overall US online population. Overall margin of sampling error is ±4.4 percentage points at the 95 percent confidence level.