Saturday, March 07, 2009

I am Woman, hear me roar...

well, not me personally. But I am showing my age by quoting a Helen Reddy tune from the 70's.


Women's Purchasing Power Grows

An often-cited marketing maxim holds that around 80 percent of consumer purchases are driven by women. The figure is often cited to emphasize how women are underestimated and under-served as customers. But the generally-accepted principle frequently leaves retailers and brands guessing at the extent of women's buying influence within given categories.

The theory bases its high purchasing power on how much a women will buy for herself, how much she buys for others (i.e., husband, boyfriend, kids, nephews, male friends, etc.) and even how much a woman will influence other purchases. Their buying acumen is often backed by stats around the female gender's growing economic power, their increasing influence in the household, as well as perhaps stereotypical views on their propensity to shop.

The finding is most often quoted from Tom Peters' Re-Imagine! Business Excellence in a Disruptive Age. In the book published in 2003, the management guru claims that women make up 83 percent of all consumer purchases. The book notes that in category after category, women are "instigators-in-chief" of most consumer purchases.

Breaking out a few categories, the book estimates that women determine a whopping 94 percent of home furnishings purchases, 92 percent of vacations, 91 of new homes, 80 percent of DIY (do-it-yourself) projects, 68 percent of car purchases, and 51 percent of consumer electronics buys. The book also found that women make up about 89 percent of the spending decisions around new bank accounts and 80 percent around healthcare decisions.

But it's tough to figure out women's influence across all categories.

For instance, take the often male-skewed sporting goods industry. In its annual Sporting Goods Market Report, the National Sporting Goods Association (NSGA) finds that women on their own behalf acquire about 55 percent of units sold in 14 categories of athletic footwear (excluding rugged outdoor, hunting boots, cleated footwear and water sport). Including purchases she drove for her husband, sons, and other male friends, purchasing power around athletic footwear could be argued to come close to the 80 percent mark. Falling well short might be the category of sports equipment, in which women make up about a third of sales and where purchasing decisions for children are often driven by the father.

But in his book, Mr. Peters laments on how, given their dominant purchasing power, women are rarely turned to when it comes to marketing and product design. And he predicted in Business Week last year that with women outpacing men in college degrees, they'll increasingly be leading decision making in Corporate America.

Mr. Peters said, "It's going to be so extreme in the next 20 years, it's just eye popping."

(Source: Retail Wire, 02/23/09)

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