“Women are the engine of the global economy, driving consumer purchasing…which means that women are the sex determining the fortunes of most consumer businesses,” explains Bridget Brennan, CEO, The Female Factor and author of Why She Buys: The New Strategy for Reaching the World’s Most Powerful Consumers. “I always say that if the consumer economy had a sex, it would be female, and if the business world had a sex, it would be male. Therein lies the pickle.”
This power comes primarily from the fact that women are increasingly becoming the breadwinners of their households. “Almost all the income growth in the U.S. since 1970 has come from women’s paychecks,” Ms. Brennan adds. “Today, 70 percent of women with kids under 18 are earning a paycheck. While women have always been the gender doing much of the shopping, their economic power has grown significantly.”
“There is no turning back,” adds Maria Reitan, senior principal, Carmichael Lynch Spong and host of the women-to-women business radio show on WebmasterRadio FM, PurseStrings. “What we have experienced in the last three to four years is our ‘new normal.’”
Impact on Baby Boomers
Perhaps the most affected, but less swayed by the economic troubles of late, are female baby boomers. Many have found themselves assisting their adult children via money and shelter, causing them to defer their own spending and visions for the future.
“The baby boomers are smack in the middle of four generations of need, but have always remained positive through the dark days of the economy,” says Stephen Reily, founder of VibrantNation.com and co-author of Vibrant Nation: What Boomer Women 50+ Know, Think, Do & Buy. “When things began to fall apart, they were the ones with more savings and discretionary income. Yet, many were still forced to sacrifice their own plans and indulgences to take care of others.”
A recent study by VibrantNation.com shows that while 44 percent of female baby boomers were raised to believe that a man would take care of them financially, 97 percent now say they have to take control over their financial future. This makes them great targets for financial service firms and others.
“They’re feeling more resilient, but not necessarily more confident,” Mr. Reily says. “They’ve been knocked down before, and they know it could happen again. But generally, they’re excited about the future.”
Remaining confident yet realistic, women are making their purchasing decisions based on not only whether a brand will work, but also if it will help solve a problem. And of course, a splurge every now and then isn’t out of the question. “Women will still spend on luxury products that offer her great value,” says Ms. Reitan. “Sure, she might not buy a new purse every year, but she’s not about to purchase the knock off. She will invest her money in timeless products. She’s also looking for luxury brands to offer her an ‘experience’ – and she has great expectations for that experience. It’s not just about the glitz and glamour anymore. She wants these products to prove a certain benefit.