American consumers are adopting European spending habits, experts say. Instead of gorging on cheap products, US shoppers are turning to high-quality goods and thinking over purchases before opening their wallets.
Americans are looking products over before pulling out plastic
Even on the crowded streets of Lower Manhattan, nearly everyone has a moment to spare to talk about how the economic crisis has affected their spending habits.
One man said his plans to buy a big, flat-screen TV fell through; one woman said she’s cut down on trips to restaurants; another added that she's begun to start thinking about whether she really needs something before she puts it the shopping cart.
Those are thoughts that most Americans weren't taking the time to have a few years ago, according to Brian Newberry, chief analyst at the Northlich brand agency, which published a study about changes in American consumer habits after the economic crisis.
"People have become more mindful of their purchases," he said. "Pre-recession people were buying whatever they wanted, whenever they wanted it because they had access to easy credit."
Savings without sacrifice
Americans are looking for ways to save money without totally sacrificing social interaction, Newberry added.
Using the example of eating out, he said people are going out less often but to more expensive restaurants, going out as often but foregoing appetizers and expensive drinks, or even inviting friends to their homes.
"Americans are choosing products that are smaller in size with less of a carbon footprint," he said. "Buying less, buying it when we need it and much more sustainable."
Americans are saving more of their disposable income
US consumers are also becoming more interested in buying better-quality products, thinking over their purchases longer before buying and spending on more high quality goods that last longer - all traits, Newman said, commonly seen in European consumers for years.
But don't expect Americans' shopping patterns to be a mirror image of Europeans'. Consumers' interests will always take top priority, said Jennifer James, who works in the North America department of the GfK group, which studies consumer habits.
"Europeans go more for environmentally friendly, sustainable types of products for more altruistic reasons, where Americans, it's still got to be about them first and if it's good for the planet, then great," she said.
Reliance on US consumers
While a considered approach to consumerism could be saving Americans money, it's not necessarily helping the US or world economies. Two-thirds of US economic growth is tied to domestic consumption, and Europe and Asian nations also rely on American consumer spending.
US consumers have started leaving their credit cards in their wallets
Statistics show that spending is decreasing.
Savings rates, at just under 6 percent of disposable income, remain much higher than the 2 percent seen five years ago, and Americans aren't pulling out their credit cards as often as just a few years ago, James said.
"The savings mentality is contagious," she said. "Even if your own financial means haven't changed, you still see Americans cutting back because they feel like they should."
The trend is particularly visible among younger people in the US who don't want to face the same problems as their parents, Newberry said.
"We're seeing the millennial generation look back at their parents and be shocked at how this affected them," he said. "Their parents were unprepared and they don't want to be like that."
Author: Miriam Braun / sms
Editor: Kyle James