Customer research reports
The ultimate end user for most products and services are consumers which makes it very important that a consumer consulting report be accurate as well as informative. A fundamental building block for consulting reports on the consumer is the monthly employment report as compiled by the Bureau of Labor Statistics (BLS). Unlike most analysts who focus on the number of new payroll jobs that comes from the survey of establishments, Richard focuses on the household employment report.
CUSTOMER RESEARCH REPORTS
Those who focus on the payroll number and average hourly earnings as a gauge as to the ability of the consumer to spend are overlooking the results from the household survey in conjunction with other surveys conducted by BLS. They come to the erroneous conclusion that the consumer is stressed because growth in average weekly earnings has been modest at best. The household survey, in conjunction with other surveys, reveals that the consumer is much better off than currently assumed.
A properly done consulting report acknowledges that nearly all of the employment growth in the household survey is comprised of persons who are working full-time, i.e. they work 35 or more hours per week. A separate annual survey reveals that workers, either full-time or part-time, are working more weeks per year also needs to be incorporated in the consulting report. Last but certainly not least is the recognition that most individuals are members of families. Thus, the basic consumer unit is not a solo person but is comprised of households where there is likely to be multiple workers. It is not quite true that two can live as cheaply as one but it is not far off the mark. Housing costs, especially rent or a mortgage payment are divided. The survey on Employment Characteristics of Families reveals that most members are employed, most members are employed full-time full-year.
The consumer consulting report also has to include information on the age distribution. The age of the household head is also an important determinant in the kinds of goods and services that are purchased. The household life-cycle is very deterministic. Young households are mainly purchasing goods associated with leaving their parents and needing many things to furnish their household. That is also true for younger households that are starting families. The consulting report recognizes that as one ages, there is the recognition that one has enough things, enough shirts, ties, shoes, etc.
It is at this stage that the preference for experiences becomes manifest, e.g. that one wants to have a nice dinner this weekend with one’s partner, nice bottle of wine, etc. By experiences, we don’t just mean the obvious in terms of health care services or financial services. Buying a Starbuck’s coffee can be viewed as an experience. It is why our favored industry is international travel. We used to think that this was mainly evident in already developed countries but now there are stories of persons in Southeast Asia who are making the transition from “needs” to “wants”. And the want is often travel, domestic as well as international.