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Economizing in the Home: Professional Services - US - October 2009

The recession beginning in December 2007 ended the longest bull-run in stocks in the history of the United States. In the wake of continued news of economic decline and hardship, consumers tightened their belts in 2008 and 2009, seeking to cut household costs, limit expenditures and maximize savings. Even if the worst of the recession is over, consumer behavior will be altered for some time. Behavioral changes from the current period are unlikely to be reversed overnight, as customers are expected to spend conservatively for several years.

Mintel’s research detailed in this report shows:

  • Households across the income spectrum are tightening budgets and cutting back on spending in a range of service areas, including cleaning, beauty, fitness, pet and childcare services
  • This report examines overall economizing efforts and analyzes the degree to which consumers are cutting back
  • Included are suggestions for how different service industries may best maintain existing customers and looks at opportunities for manufacturers of related products to develop their market presence by offering economical alternatives to professional services

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Table of contents

  1. Scope and Themes

    • What you need to know
      • Definition
        • Consumer survey data
          • Abbreviations and terms
            • Abbreviations
              • Terms
              • Executive Summary

                • Recession has substantial lingering ramifications in spite of “recovery”
                  • Households with children, women and Hispanics cutting back most
                    • At the top line
                      • Home cleaning
                        • Laundry and dry cleaning
                          • Childcare
                            • Pet care
                              • Salon and spa
                                • Fitness
                                  • Consumers pare back use of cleaning services
                                    • Low-cost alternatives to laundry, dry cleaning services include appliances, special soaps and new products
                                      • Parents taking on more childcare
                                        • As families reduce art lessons, at-home cultural materials may be promoted
                                          • Supporting sport teams and children’s clubs may offer branding and marketing opportunities
                                            • Upper-income families maintain more services, middle-income families seeking lower-cost alternatives
                                              • Cutbacks on pet services open opportunities for products and new services
                                                • Growth opportunity in at-home alternatives to salon, nail and spa services
                                                  • Promoting at-home fitness options with discounted/alternative club memberships
                                                    • Hispanics, hard hit by downturn, economize aggressively
                                                    • Inspire Insights

                                                      • Smart shopping gets smarter
                                                        • What it means for professional services: incremental gains via auctions
                                                        • Lingering Impacts of the 2007-09 Recession

                                                          • Key points
                                                            • Falling real estate values shrink household wealth and limit home equity
                                                              • Figure 1: Case-Shiller U.S. national home price index, January 2000-January 2009
                                                            • Stock market decline further diminishes wealth
                                                              • Unemployment still rising
                                                                • Figure 2: U.S. unemployment rate, September 2008-September 2009
                                                              • Rebuilding wealth is a long-term project
                                                                • The psychology of financial losses determines future behavior
                                                                  • Effective branding now can engender loyalty
                                                                  • Who is Economizing at Home?

                                                                    • Key points
                                                                      • Two thirds have cut spending; families and Hispanics economizing most
                                                                        • Figure 3: Changes or plans to change spending to save money, by gender and presence of children, March 2009
                                                                        • Figure 4: Changes or plans to change spending to save money, by age, household income and marital status, March 2009
                                                                        • Figure 5: Changes or plans to change spending to save money, by race/Hispanic origin and employment status, March 2009
                                                                    • Household-cleaning Services and Supplies

                                                                      • Key points
                                                                        • Cutbacks in household-cleaning services may drive more DIY cleaning
                                                                          • Figure 6: House cleaning service, changes in service use in the past 12 months, March 2009
                                                                        • Interest in window washers drops
                                                                          • Figure 7: Window-washing service, changes in service use in the past 12 months, March 2009
                                                                          • Figure 8: Windex All-In-One Glass Cleaning Tool
                                                                        • Equipment rentals as alternatives to professional upholstery cleaners
                                                                          • Figure 9: Furniture or rug-cleaning service, changes in service use in the past 12 months, March 2009
                                                                        • Some 70% cutting back on cleaning supplies
                                                                          • Figure 10: Reduced spend on household cleaners, March 2009
                                                                        • Cutting back on cleaning products decreases as household income rises
                                                                          • Figure 11: Reduced spend on household cleaners, by household income, March 2009
                                                                        • Consumers cutting back on cleaning products in a variety in ways
                                                                          • Figure 12: Select private-label household cleaners
                                                                      • Laundry and Dry Cleaning Service

                                                                        • Key points
                                                                          • Laundry services
                                                                            • Figure 13: Laundry service, changes in service use in the past 12 months, March 2009
                                                                          • Dry cleaning service
                                                                            • Figure 14: Woolite Dry Clean At Home
                                                                            • Figure 15: Dry cleaning service, changes in service use in the past 12 months, March 2009
                                                                          • Changes in laundry and dry cleaning services by household income
                                                                            • Figure 16: Change in use of laundry services in the past 12 months, by household income, March 2009
                                                                            • Figure 17: Dry cleaning service changes in the past 12 months, for those with HH income of $100K+, March 2009
                                                                        • Childcare

                                                                          • Key points
                                                                            • Childcare/babysitting reduced as unemployment rises and subsidies fall
                                                                                • Figure 18: Child daycare services, changes in service use in the past 12 months, March 2009
                                                                                • Figure 19: Babysitting services, changes in service use in the past 12 months, March 2009
                                                                              • After-school care also sees enrollment shrink
                                                                                • Figure 20: Children after-school care, changes in service use in the past 12 months, March 2009
                                                                              • Parents cut back on art, music and dance lessons
                                                                                • Figure 21: Children’s art, music or dance lessons, changes in service use in the past 12 months, March 2009
                                                                              • Parents cut back on sports expenses, but strive not to eliminate entirely
                                                                                • Figure 22: Children’s sports lessons, changes in service use in the past 12 months, March 2009
                                                                              • Substantial cuts to sports team membership
                                                                                • Figure 23: Children’s sports teams, changes in service use in the past 12 months, March 2009
                                                                              • Children’s clubs suffer cutbacks
                                                                                • Figure 24: Children’s clubs, changes in service use in the past 12 months, March 2009
                                                                              • Income determines extent of cutbacks
                                                                                • Figure 25: Changes in use of services/activities for children in the past 12 months, by household income, March 2009
                                                                            • Pet Care

                                                                              • Key points
                                                                                • Pet-grooming services in decline
                                                                                  • Figure 26: Pet-grooming services, changes in service use in the past 12 months, March 2009
                                                                                • More consumers cut back on kennel services than maintain them
                                                                                  • Figure 27: Pet kennel/boarding services, changes in service use in the past 12 months, March 2009
                                                                                • Pet owners cut back on obedience classes and pet daycare
                                                                                  • Figure 28: Pet obedience or agility classes, changes in service use in the past 12 months, March 2009
                                                                                  • Figure 29: Pet daycare, changes in service use in the past 12 months, March 2009
                                                                                • Changes made in pet care services, by household income
                                                                                  • Figure 30: Has made no change in use of pet services in the past 12 months, by household income, March 2009
                                                                              • Salon and Spa

                                                                                • Key points
                                                                                  • Half of women cut down on hair-cutting services
                                                                                    • Figure 31: Hair salons—hair cutting, changes in service use in the past 12 months, by gender, March 2009
                                                                                  • Consumers pare back use of coloring services
                                                                                    • Figure 32: Hair tinting/coloring, changes in service use in the past 12 months, by gender, March 2009
                                                                                  • Consumers cut back on nail services
                                                                                    • Figure 33: Nail salon, changes in service use in the past 12 months, by gender, March 2009
                                                                                  • Consumers cut back or stop massages
                                                                                    • Figure 34: Massage, changes in service use in the past 12 months, by gender, March 2009
                                                                                  • As many stop facials and “other spa services” as have continued to do so
                                                                                      • Figure 35: Facials, changes in service use in the past 12 months, by gender, March 2009
                                                                                      • Figure 36: Other spa services, changes in service use in the past 12 months, by gender, March 2009
                                                                                    • Only highest income bracket shows above-average use of salon and spa
                                                                                      • Figure 37: Has made no change in use of salon and spa services in the past 12 months, by household income, March 2009
                                                                                  • Fitness

                                                                                    • Key points
                                                                                      • Fitness class cutbacks
                                                                                        • Figure 38: Fitness classes, changes in service use in the past 12 months, by household income, March 2009
                                                                                      • Upper-income households cut back on personal trainers
                                                                                        • Figure 39: Personal trainer, changes in service use in the past 12 months, by household income, March 2009
                                                                                      • Income drives fitness club membership
                                                                                        • Figure 40: Club memberships, changes in service use in the past 12 months, by household income, March 2009
                                                                                    • Custom Consumer Groups

                                                                                      • Introduction
                                                                                        • Key points
                                                                                          • Upper-income Hispanics economizing at high rate
                                                                                              • Figure 41: Economizing in the past year, Hispanics and whites with HH income of $75K+, March 2009
                                                                                          • Cluster Analysis

                                                                                              • The Unchanged
                                                                                                • Cutters
                                                                                                  • Reformed Spenders
                                                                                                      • Figure 42: Household budget changer clusters, March 2009
                                                                                                    • Cluster responses
                                                                                                      • Figure 43: Use of cleaning services, by cluster, March 2009
                                                                                                      • Figure 44: Use of laundry services, by cluster, March 2009
                                                                                                      • Figure 45: Use of salon/spa services, by cluster, March 2009
                                                                                                      • Figure 46: Use of fitness services and clubs, by cluster, March 2009
                                                                                                      • Figure 47: Use of pet services, by cluster, March 2009
                                                                                                      • Figure 48: Use of services related to children, by cluster, March 2009
                                                                                                      • Figure 49: Intent to cut expenses for upcoming year, by cluster, March 2009
                                                                                                    • Cluster demographics
                                                                                                      • Figure 50: Clusters, by gender, March 2009
                                                                                                      • Figure 51: Clusters, by age, March 2009
                                                                                                      • Figure 52: Clusters, by household income, March 2009
                                                                                                      • Figure 53: Clusters, by race/Hispanic origin, March 2009
                                                                                                    • Methodology
                                                                                                    • Appendix—Fitness Trade Associations

                                                                                                      • Appendix—Trade Associations: Pet Care

                                                                                                        • Appendix—Trade Associations: Laundry and Dry Cleaning Service

                                                                                                          • Appendix—Trade Associations: Childcare

                                                                                                            Companies Covered

                                                                                                            • Greenfield Online
                                                                                                            • International Health, Racquet & Sportsclub Association (IHRSA)
                                                                                                            • Jewish Community Center Association
                                                                                                            • Mid-Atlantic Club Management Association (MACMA)
                                                                                                            • National Intramural-Recreational Sports Association
                                                                                                            • National Recreation and Park Association (NRPA)
                                                                                                            • National Strength & Conditioning Association (NSCA)
                                                                                                            • Nike
                                                                                                            • Pet Food Institute (PFI)
                                                                                                            • Pet Industry Distributors Association
                                                                                                            • Pet Industry Joint Advisory Council (PIJAC)
                                                                                                            • Procter & Gamble USA
                                                                                                            • S.C. Johnson & Son, Inc.
                                                                                                            • U.S. Bureau of Labor Statistics
                                                                                                            • US Department of Labor
                                                                                                            • World Wide Pet Supply Association (WWPSA)
                                                                                                            • YMCA of the USA

                                                                                                            Economizing in the Home: Professional Services - US - October 2009

                                                                                                            £1,589.32 (Excl.Tax)