SOURCE: BIGresearch

August 22, 2006 11:08 ET

Gas Prices Are Not Impacting Everyone Equally

BIGresearch Survey Reveals Major Spending Gap Between Income Groups

COLUMBUS, OH -- (MARKET WIRE) -- August 22, 2006 --Households with incomes under $50K per year are bearing a greater burden from high gas prices according to BIGresearch's August Consumer Intentions and Actions Survey of over 8,500 consumers. Only 24% said high gas prices are having no impact on their spending. However, when broken into income groups, 30% of those making more than $50K per year reported no major impact, compared to only 22% of consumers making less than $50K per year.

"While economic concerns and rising gas prices are causing consumers to exercise more judgment in their spending across the board, not all income groups are affected equally," said Joe Pilotta, VP of Research for BIGresearch. "There is a definite gap between those making less than $50K per year and those making more -- and it's only getting wider."

The survey showed that 81% of consumers in the < $50K group felt they are the same or worse off financially than this time last year. To cope with higher gas prices, they are making some pretty significant changes, including deferring major purchases, dining out less, cutting back on travel and, of course, driving less. Those who make $50K+ per year are not making the same sacrifices. In fact, 78% of that group felt they were the same or better off financially than last year.

How have fluctuating gas prices impacted your spending?

                                    < $50K    $50K+     ALL
Delayed major purchase such            27%     21%      23%
as a car, TV or furniture
Reduced dining out                     43%     34%      37%
Decreased vacation/travel              42%     36%      37%
Increased carpooling                    7%      7%       7%
I will be driving less                 49%     42%      43%
Spending less on groceries             23%     12%      17%
Spending less on clothing              34%     25%      29%
Other                                   8%      7%       7%
No major impact                        22%     30%      24%
*The sum of the % totals is greater than 100% because respondents could
select more than one answer.
"Looking at the impact of gas prices between both income groups, particularly in staples like groceries and clothing, it's clear that deferred spending is taking a harder toll on consumers making less than $50K per year," said Pilotta. "This should be a defining moment for retailers who depend on this customer base. Success hinges on paying attention to what types of purchases are being deferred -- because the gaps we're seeing now could become gulfs very rapidly."

To comment on this release visit the BIGresearch blog: http://whencustomerstalk.blogspot.com.

About BIGresearch

BIGresearch is a market intelligence firm providing analysis of consumer behavior in areas of retail, financial services, automotive, and media. The syndicated Consumer Intentions and Actions Survey (CIA) monitors the pulse of more than 7,000 consumers each month. The syndicated Simultaneous Media Usage Survey (SIMM) monitors more than 15,000 consumers twice each year. BIGresearch's methodology provides the most accurate consumer information in the industry with a margin of error of +/- 1 percent. Complimentary findings are available at www.bigresearch.com.

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