Piper Jaffray Completes 25th Semi-Annual "Taking Stock with Teens" Market Research Project
"Our spring 2013 survey results suggest teens have a heightened sense of
awareness surrounding seasonal spending fluctuations and broader
macroeconomic sensitivities,” said
Key findings from the survey in fashion, beauty and personal care, restaurants, digital media, gaming, and wireless communication include the following:
- The fashion category accounts for roughly 40% of teen budgets, consistent with prior survey cycles. Spending among upper-income teens was down modestly to the prior year and season while average-income teens indicated a slight increase. Implying the pause in spending may be temporary, approximately 53% of upper-income teens plan to spend more on fashion apparel in the coming periods. Parent contribution to teen spending contracted by nearly 10 percentage points in our spring survey, with 55-60% of teens indicating their parents contribute more than half of their spending. Within the fashion category specifically, insights into key trend changes include a basing in action sports mindshare, declining demand for fast fashion, emergence of a refined classic or preppy aesthetic, and preference for fashion athletic wear.
- Teens are exhibiting changes in shopping behaviors that will likely reshape the way brands target this demographic including shopping less frequently and shopping online instead of in specialty and department stores. Approximately 79% of females and 76% of males shop online, and respondents indicated that roughly 18% of their spending is online. Nearly 70% of teens indicate they prefer to shop the Web sites of their favorite stores-based retailers. In addition, teens prefer labels to logos and seek value in their purchases, owing to the rise of spending in the outlet and off-price channels. Approximately 70% of teen girls and 55% of teen boys shop at off-price stores and 55% and 42%, respectively, indicated it is popular to do so. The shift toward digital is proliferating softlines, hardlines and media purchases. Streaming accounts for 46% of movie rentals and online music provider Pandora accounts for 22% of preferred music sources.
Teens have cited "friends" as the strongest influence over their
purchase decisions for the duration of our survey history, but
"Internet" is quickly rising in profile. Approximately 53% of females
and 52% of males indicate that social media impacts their purchases
- Beauty spending among upper-income teens declined 3% year-over-year and increased 2% sequentially. For average-income teens, beauty spending increased 1% year-over-year and 4% sequentially. For the second consecutive survey, average-income beauty spend is now at parity with upper-income spending. MAC was cited as the No. 1 cosmetics brand for upper-income teens for the fifth survey in a row and Cover Girl ranks at the top of the list for average-income teens. Teens continue to demand greater diversity of cosmetics offerings, likely spurred by several emerging cosmetics brands coming to market with new and superior innovations.
Teens are increasingly choosing organic food options, with 42% eating
organics versus just 33% two years ago. This trend is likely to
support ongoing demand for natural and organic grocery, as teens age
into young adults and establish independent households. When eating
out, 57% of teens prefer limited service restaurants, up steadily from
43% four years ago. When identifying their preferred dining segment,
41% select quick service, 36% casual dining and 15% fast casual
options. In addition to classifying by segment, preferred restaurant
brands also provide insight into various cuisine profiles—for American
Cuisine, teens favor
Cheesecake Factory; for Italian, teens favor Olive Garden; and for Mexican-inspired fare, teens favor Chipotle Mexican Grill.
Mobility and connectedness are driving nearly 91% of teens to purchase
a smartphone for their next wireless device, with approximately 60%
Appleand 21% likely to buy an Android device, consistent with our prior survey cycle. Survey results point to teens prioritizing unlimited data plans as the most important service plan feature when choosing a carrier, with Verizonand AT&Tidentified as having the "best" networks. Approximately 48% of teens own an iPhone, up from 40% six months ago. Tablet ownership also continues to grow, with 51% of teens owning a tablet computer, up from 44% in fall 2012, with 68% of teens identifying Apple'siPad as their owned device.
- Teens represent more than one-third of video game players and gaming accounts for 6% of teen spending. Interest in traditional gaming consoles remains strong entering a new console cycle. Awareness of next generation consoles was 73% among teens that play video games at least monthly. Approximately 52% of teens intend to purchase a next generation console. Buying and selling used video games remains a critical component of the gaming industry, with 63% of gamers buying used games and 29% of teens trading in old games to fund new software and hardware purchases.
The "Taking Stock With Teens" survey is a semi-annual research project
comprised of gathering input from approximately 5,200 teens with an
average age of 16.3 years. Teen spending patterns, fashion trends, and
brand and media preferences were assessed through visits to a
geographically diverse subset of high schools in 10 U.S. states and
through a national online survey of a wider group of teens from 37
different states. The survey is conducted in partnership with
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Pamela Steensland, 612-303-8184