It appears that the increase in economic confidence might be a result of a more positive outlook for the labor market…in April, about one in four (27.6%) contend there will be “more” layoffs in the next six months, lowering from 30.8% in March as well as 51.9% a year ago. Nearly half (48.6%) feels that layoff levels will remain the “same,” flat from March, while more than one in five (23.8%) says “fewer,” rising from 20.8% last month.

With the national unemployment rate remaining a stable (albeit high) 9.7%, consumers remain confident about their personal job situations…this month, 3.9% still harbor concerns about becoming laid off, relatively flat from March (3.7%) and lowering 50% from Apr-09 (8.1%).

Lesson learned? Although confidence and practicality have improved from Apr-09, consumers aren’t willing to crack their piggy banks for a good old fashioned spending spree…this month, 28.5% report they are focused on increasing savings, relatively flat from a year ago (28.2%).  Consumers also remain resolute about paying with cash more often (25.7%), while plans to decrease overall spending (35.0%) as well as pay down debt (34.5%) have declined slightly from Apr-09.

The DJIA – now above 11K – made steady gains in March, and investor confidence in April appears to have improved as a result…this month, 52.4% of investors say they would definitely/probably gamble on Wall Street, up slightly from March (51.7%) and rising nearly 9 points from a year ago (43.7%).

With gas prices inching closer to the $3/gal mark, consumers continue to be focused on offsetting the effects of rising fuel costs on their pocketbooks…compared to Apr-09, an increasing number of consumers are shopping closer to home (39.2%), taking fewer shopping trips (41.8%), and using coupons more often (37.8%). Another popular cost-cutting measure, buying store brand/generic products (33.0%), is flat from a year ago (33.4%).
 

With even high-end retailers and brands catering to budget-conscious, value-oriented consumers, affordable fashion appears to be becoming a non-guilty pleasure for many would-be trendsetters…this month, 16.1% of consumers say that newest trends and styles are important, the highest reading since Oct-08 (18.5%).  Nearly half of consumers (49.4%) remain focused on value and comfort when buying clothing, while one in three (34.5%) prefers a traditional conservative look.

Walmart is still the top spot shopped for Women’s Clothing (12.1% shop there most often), but Kohl’s continues to improve in this category…in April, one in ten (10.2%) contends they shop the department store most often, rising from 9.4% a year ago. JC Penney (7.4%) and Macy’s (7.3) also improve (from 6.8% and 6.3% in Apr-09, respectively), while Target (2.4%) rounds out the top 5.  Price (61.2%) tends to guide a Women’s apparel shopper to a particular store most often, followed by selection (50.0%), quality (39.8%), location (37.3%), and coupons/special sales (19.5%).

With each of the three department stores (Kohl’s, JC Penney, and Macy’s) making consumer share gains over the past year, are any/all of these retailers poised to topple Walmart in Women’s?  This month’s Consumer Migration Index (CMI) for Women’s Clothing, which tracks those who have immigrated to a store (new customers within the past year) against those who have emigrated (left within the past year) and where a positive rating spells net growth to a retailer, shows that Kohl’s (with a +4.9 CMI) has experienced a customer conversion surplus, while Walmart (-2.0) and JC Penney (-2.5) are facing a deficit.  Macy’s and Target are relatively flat:

With the pressure still on household budgets, it shouldn’t be a surprise that the top reason to switch a particular Women’s Clothing store hinged on high prices (17.1%)….inconvenient location (10.1%), unavailability of correct sizes (8.4%), poor selection (8.2%), decline of store appearance (5.5%), and lack of newest fashions (also 5.5%) were also top complaints.

Editor’s note on JC Penney: How can a retailer, such as JC Penney, experience year-over-year growth in consumer preference share (6.8% to a current 7.4%), but have a negative CMI rating (-2.5)? The CMI measures a store to store shift in consumer preference (i.e. “I shop Store X most often, but a year ago, I shopped Store Y most often.”)  JC Penney’s overall share growth is attributable to “No Preference” conversion (i.e. “I shop Store X most often, but a year ago, I didn’t have any store preference.”)  In the past year, JC Penney Women’s Clothing shoppers have become younger, more likely to be single (never married), and more apt to be a student or clerical/service worker.  So, this year-over-year growth has come at the “expense” of some its core consumer base (who were more likely to be 65+ in age, married, and/or retirees).

Over in Men’s Clothing, Walmart continues to headline as the store shopped most often (16.2% say so)…Kohl’s (9.0%), JC Penney (8.3%), Macy’s (4.6%), and Sears (2.9%) follow.

Two discounters are on top in Children’s Clothing…though Walmart (13.6%) leads #2 Target (4.5%) by a fairly wide margin…Kohl’s (4.4%), JC Penney (2.9%), and Gap (1.7%) round out the top 5.

Walmart also continues as the leader in Shoes with more than one in ten (11.5%) shopping the big discounter most often…second place Payless continues (9.8%) as a close competitor, while Kohl’s (5.1%), DSW (3.8%), and JC Penney (3.3%) follow.

A snapshot of the Linens/Bedding/Draperies category completes our softlines tour for April…here, nearly one in five (19.0%) shops Walmart most often, while more than one in ten (11.6%) opt for big box Bed Bath & Beyond. JC Penney (7.0%), Target (5.7%), and Kohl’s (3.5%) complete the top 5.

Best Buy continues as the best bet in Electronics…nearly a third of consumers (31.2%) shops the big box most often, while one in five (21.0%) opts for discounter Walmart. Target (3.1%), Amazon.com (3.1%), and Sears (2.0%) follow.

Walmart is again on top in the Grocery aisle…almost one in five (18.0%) shops the discounter most often, followed by traditional grocers Kroger (6.5%), Publix (3.8%), and Safeway (3.0%)…Meijer (2.4%) rounds out the top 5.

With three times the share of its nearest competitor, Walmart (30.1%) will likely be the long-term lead in Health & Beauty Care…CVS (9.4%), Walgreens (9.4%), Target (6.2%), and Rite Aid (3.2%) follow.

Traditional druggists continue to corner the market in Prescription Drugs…Walgreens (15.8%) and CVS (14.8%) lead Walmart (11.1%), Rite Aid (5.5%), and Target (2.3%) in this category. 
 

Rising economic and employment sentiment appear to have positively affected the 90 Day Outlook, according to the BIGresearch Diffusion Index (those who say they’ll spend less subtracted from those who will spend more).  As shown in the table below, most categories have picked up from Mar-10 and all have improved versus Apr-09 and Apr-08…however, compared to a pre-recession Apr-07, this month’s Outlook continues to remain depressed for all categories, yet another sign that consumer spending hasn’t yet recovered:

Retail Merchandise Categories - 90 Day Outlook
(Apr-10 compared to Mar-10, Apr-09, and Apr-08)

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