Consumers Go Online to Save Money & Gas

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Consumers Cut Spending amid Inflation, Go to Web for Deals

Everyday consumer spending is taking a beating, with some 56% of 3,359 online shoppers surveyed April 29 to May 23 indicating that they are cutting back because of the weak economy and growing inflation, according to PriceGrabber.com’s Consumer Behavior Report:

• 42% of respondents indicated retail shopping as the primary category in which they are reducing spend.
• More than one-third of respondents indicated that their top money-saving trick for retail shopping is the use of comparison-shopping websites.
• Other ways consumers are reducing their retail spending is through discount and bargain shopping and using low-interest credit cards or cash.

Tax refunds to pay off debt

Some 65% of 1,328 online shoppers surveyed March 25 to April 19 said they plan to spend their tax refund.

Of that group, 45% plan to use that money on an existing loan. Of the respondents applying their refund to a loan, 68% indicated a credit card as that loan:

Even with concern about an unstable economy, 22% of tax refund spenders indicated using the refund for home improvement and 11% for a vacation.

Economic stimulus checks

Despite government efforts to increase consumer spending through the economic stimulus program, a June survey of 2,483 online shoppers found that 89% of respondents are still cutting back.

Similar to the results of the tax-refund survey, more than one-third of consumers who indicated that they spent their economic stimulus checks used them to pay off debt.

31% of online consumers spent their checks on retail shopping. Of those who spent their stimulus checks, 27% bought one large item and 25% spent the money immediately on multiple items.

Soaring Gas Prices Force 94% of Consumers to Change Lifestyles

Higher-than-ever gas prices have caused 94% of Americans to make lifestyle changes to control costs, according to a recent MapQuest survey. This includes more than 80% of consumers who are forfeiting day-to-day activities and changing spending habits.

Among the changes:

• 82% are making a conscious effort to drive less.
• 57% are planning their routes more carefully.
• 24% are walking or biking more.
• 31% are only partially filling their gas tanks.
• 62% are dining out less.
• 19% are giving up heating and air conditioning
• 18% are paying the minimum balance on credit cards.
• Nearly one out of ten is stopping or cutting back on medications.
• More than 50% are unwilling to take road trips more than 100 miles.

Gas prices are increasing the level of overall debt for 76% of Americans, who are using credit cards more to pay for gas.

Consumers have strong opinions on what is causing high gas prices and how to stop the steep increases: More than a quarter (27%) believe oil companies are to blame for the continually rising gas prices, while 78% feel that the federal government should step in and set limits on gas prices.

In addition, 66% of consumers say high gas prices have forced them to alter vacation plans, with 34% canceling their travel plans altogether. Another 37% have opted for shorter trips closer to home, the survey finds.

A separate survey of families with children, from AOL’s Platform-A Strategic Insights Group, found that 70% of US families planned to get away this summer and spend at least $1,000 for a week of vacation. Despite these expressed intentions, nearly two-thirds of these families had yet to book their summer travel when the survey was conducted in April.

The internet is an important source for information about travel and gas prices:

• MapQuest found that 24% of consumers are turning to the internet to search for lower gas prices, and more than half intend to use websites to determine the cost difference between driving and flying when planning their next trip.
• AOL Platform-A reports that 75% of families that plan to travel will make an online reservation for a rental car, air travel or lodging.

When evaluating modes of transportation for a trip, MapQuest reported that 58% are the most concerned with the cost of gas vs. airplane tickets. The AOL Platform-A Strategic survey found that driving still may be a more cost effective option for families. Some 71% say they will travel by car because they find it more affordable than flying.

“There’s no question that rising gas prices are having a significant impact on the lives of consumers across the country,” said Christian Dwyer, SVP and general manager, MapQuest. “Our survey shows the extent of the hardships consumers are experiencing as well as the concessions they’re making to off-set these costs.”

About the research: MapQuest collaborated with DMS Research to field the research among a sample of 1,001 US Internet users, age 18+. Interviews were conducted from June 5 - 11, 2008. AOL’s Platform-A worked with OTX Research to survey 1,000 families with school-aged children (age 6-17). Interviews were collected from April 10 – 14.

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