{"id":935217,"date":"2026-07-14T22:21:16","date_gmt":"2026-07-14T22:21:16","guid":{"rendered":"https:\/\/www.europesays.com\/us\/935217\/"},"modified":"2026-07-14T22:21:16","modified_gmt":"2026-07-14T22:21:16","slug":"how-retailers-drive-spending-amid-economic-pressures-trends","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/us\/935217\/","title":{"rendered":"How Retailers Drive Spending Amid Economic Pressures & Trends"},"content":{"rendered":"

\n\tThe American consumer<\/a> has always been about \u201cmore\u201d \u2014 spending more to celebrate the good times and then sometimes spending even more to take the edge off the bad times.\u00a0<\/p>\n

\n\tBoth of those scenarios have played out since the COVID-19 pandemic reset retail\u2019s economic calculus.\u00a0<\/p>\n

\n\tThe result is a consumer today who\u2019s lacking in confidence, but still spending and now finding a lot more of everything is coming at them, both the good and the bad.\u00a0<\/p>\n

\n\tComparing the U.S. consumer economy today with seven years ago \u2014 right before the pandemic started \u2014 the income side looks OK, taken on its own. Weekly earnings are up 34.2 percent and once taxes are taken out disposable personal income is up 15.8 percent, while the unemployment rate is still low at 4.2 percent.\u00a0<\/p>\n

\n\tBut if consumers have a little more in their wallets right now, they\u2019re also paying a lot more to fuel up on their way to work or to get a bite at the mall.\u00a0<\/p>\n

\n\tGasoline prices are up 45.5 percent since 2019 and food is up 35.5 percent, while prices on all goods were up 30.3 percent. By comparison, fashion has not kept up that pace, with women\u2019s apparel prices inching up just 4.3 percent although men\u2019s apparel prices did jump 20.2 percent.\u00a0<\/p>\n

\n\tAnd Americans are also borrowing more than before the pandemic to keep up with their spending. There\u2019s been a 26.1 percent increase in outstanding revolving consumer credit, which is mostly credit card debt, a category that\u2019s seen delinquencies increase. Housing debt is up 41.3 percent. And interest payments to cover it all are up 77.1 percent.\u00a0<\/p>\n

\t\t\t\t\t\t\"\"<\/p>\n

\n\tPutting all this together and the result is slow, steady growth in spending.\u00a0<\/p>\n

\n\tRetail and food services sales rose 4.3 percent through May this year, leaving room for a percentage or two of growth over inflation.\u00a0<\/p>\n

\n\tBut not everyone is taking part in that growth.<\/p>\n

\n\t\u201cThe averages look good, but if you lift the hood and look at the different tranches of consumers, not everybody is doing as well,\u201d said Gregory Daco, chief economist at EY-Parthenon.\u00a0<\/p>\n

\n\t\u201cIndividuals that are at the lower echelons of the income spectrum are facing more pressures from higher prices, from the cumulative inflation over the course of the past six years,\u201d Daco said. \u201cAnd they\u2019re generally the ones that are most exposed to higher prices at the pump, higher prices at grocery stores and they\u2019re also the ones that have \u2014 of late \u2014 not benefited from as strong wage growth.\u201d<\/p>\n

\n\tWhere spending has been stronger, it\u2019s being fed by more than just the consumer\u2019s regular paycheck.\u00a0<\/p>\n

\n\t\u201cThose that are higher up have a little bit more spending capacity, but it\u2019s not necessarily based on income,\u201d he said. \u201cIt\u2019s based on wealth. It\u2019s based on access to credit. It\u2019s based on some dis savings \u2014 reduced savings.\u201d<\/p>\n

\n\tWhile that has helped fashion retailers plug along, it is a foundation that can be dicey to build on.\u00a0<\/p>\n

\n\t\u201cIf you look out over the next year, a key question that remains unanswered is how much resilience will we retain as we continue to be in this environment where there is ongoing income erosion and where spending capacity is under pressure?\u201d Daco said.<\/p>\n

\n\tLittle wonder that the give and take of those economic realities, the war in Iran, the rise of AI and a host of other worries have shoppers on edge.\u00a0<\/p>\n

\n\tThe Conference Board\u2019s consumer confidence index inched up 0.6 points to 91.2 in June \u2014 down from 121.5 seven years ago \u2014 a time when confidence hit a nearly two-year low amid U.S. President Donald Trump\u2019s first round of trade wars.\u00a0<\/p>\n

\n\tBut those are the economic crosswinds retailers have to navigate \u2014 something merchants are doing with a varying degree of skill and resources.\u00a0<\/p>\n

\n\tWhile in the past the industry pushed for more, more, more, the best companies today are winning by being a little more selective, moving up the price scale to capture the shoppers who have a bigger piece of that disposable income pie.\u00a0<\/p>\n

\n\t\u201cThey\u2019re being more thoughtful in who they\u2019re going after and how they\u2019re going after them,\u201d said Marcie Merriman, cultural anthropologist, brand strategist and founder of Ethos Innovation, of the savviest retail players.<\/p>\n

\n\t\u201cI see them also investing more thoughtfully into the experience, into the employees, into the people that are on the front line with the customers,\u201d Merriman said.\u00a0<\/p>\n

\n\tBy way of example, she looked outside of fashion and to Starbucks.\u00a0<\/p>\n

\n\t\u201cThey slipped big time by becoming more of that commodity or transactional,\u201d she said. \u201cAnd as they\u2019ve invested back more in the stores and the experience, they continue to lift up and do better.\u201d<\/p>\n

\n\tLikewise, the top names in American fashion today \u2014 from Ralph Lauren Corp.<\/a> to Tapestry Inc.\u2019s Coach<\/a> brand \u2014 have spent the last several years focusing on giving consumers better experiences and more branding oomph along with some savvier technology on the back end of the business.<\/p>\n

\n\tThey have also been raising their average unit retail prices, playing off their marketing muscle and picking and choosing more categories and looks that will appeal to higher-end consumers.\u00a0<\/p>\n

\n\tIt\u2019s an approach that more brands are using, raising expectations across the industry.\u00a0<\/p>\n

\n\t\u201cI don\u2019t know how long they get away with it, but actually offering more premium product in addition to their basic [looks] can bring in the people who are on the higher end. But at the same time, that premium level makes the basic things that you\u2019ve been selling look more high end.\u201d<\/p>\n

\n\tShe pointed to Levi\u2019s as an example.\u00a0<\/p>\n

\n\tLast week, Michelle Gass, chief executive officer of Levi Strauss<\/a> Inc., touted the brand\u2019s new higher-end offer to analysts on a quarterly conference call.\u00a0<\/p>\n

\n\t\u00a0\u201cBlue Tab continues to gain traction as the most premium expression of our brand,\u201d Gass said. \u201cImportantly, Blue Tab is introducing the Levi\u2019s brand to a new consumer, and we are already seeing early share gains at the premium end of the category. While still in the early stages, we see significant runway ahead as we scale the business, unlocking a sizable premium segment that remains underpenetrated for Levi\u2019s today.\u201d<\/p>\n

\n\tThat, it seems, is the new way to play the market share game in fashion.<\/p>\n","protected":false},"excerpt":{"rendered":"The American consumer has always been about \u201cmore\u201d \u2014 spending more to celebrate the good times and then…\n","protected":false},"author":3,"featured_media":935218,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[12],"tags":[64,4160,79,305810,70420,248498,67,132,68],"class_list":["post-935217","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-coach","tag-economy","tag-levi-strauss","tag-ralph-lauren-corp","tag-sourcing-journal","tag-united-states","tag-unitedstates","tag-us"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/116920668367828451","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/935217","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=935217"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/935217\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/935218"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=935217"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=935217"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=935217"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}