1. RECESSION-REWIRED: Leaner times hit home for moms and younger millennials KELLY MOONEY President, Resource Interactive and co-author of The Open Brand PRESENTED BY: SPONSORED BY:

2. RECESSION OBSESSION

3. DEPRESSION DEPRESSION THE LOST DECADE? Median household income in 2008 slipped to $50,303 from $51,295 in 1998. Source: U.S. Census Bureau, 2009

4. Real Personal Consumption per Capita vs. Savings YEAR OVER YEAR CHANGE / PERCENT Source: EconomPic Data, June 2009 Shifting gears... CONSUMPTION SAVINGS

8. Abercrombie & Fitch Percent Change Same Store Sales August 2009 vs. August 2008 Aeropostale American Eagle Buckle Costco Gap, Inc. Hot Topic JCPenney Kohl's Limited Brands Macy’s Neiman Marcus Nordstrom Target TJX Companies Source: Retail Forward, August 2009

10. Q. How has the consumer changed? Will the changes be enduring? Is there untapped opportunity in this crisis for online retailers?

11. Remember the 1990 s?

12. During the early ‘90s recession, teens were discovered as a valuable demo and peer pressure emerged as a powerful market force.

13. “ Their parents might have gone bargain basement but kids, it turned out, were still willing to pay up to fit in .” Source: No Logo , Naomi Klein

14. GEN Y: The prematurely affluent generation

15. 1 st wave feel recession is unfair My generation is being dealt an unfair blow because of this recession The current situation with housing prices actually makes me feel optimistic about buying a home All of the online resources for jobs searches and networking make me feel less anxious about losing/finding a job If the employment situation worsens, I may have to move back in with my parents Most of the people my age that I know are not that worried about the recession My friends are doing interesting entrepreneurial things to make more money If I lose/have trouble finding a job, I’ll just start my own business % who agree Among young adults 18-29 Besides fear, how do most Millennials feel about the recession? A narcissistic sense of being unfairly burdened. Yet some optimism emerges as well. NO FAIR! Source: JWT, 2009

16. Thrift is an alien virtue

17. 73% of women said the recession has fundamentally changed the way they think about saving and spending money vs. 57% of men . Source: Performics Survey, April 2009

20. UNDERSTAND THE REWIRING

21. RECESSION BRAND SHOPPING DIGITAL

22. RECESSION BRAND SHOPPING DIGITAL

25. “ It’s the fault of the previous generations who over-consumed. So I hope we can learn from their mistakes and be the generation that lives within their means.” 81% of household heads say that kids are aware of the recession and the impact it is having on household budgets. Source: Ad Age , April 2009 — Alicia, 18

26. Recession-related issues have replaced more typical teenage ego-centric worries as their top concerns. (Among teenagers 13-19) 2 nd wave facing recession head-on If there will be good jobs when I graduate Whether I’ll have to give up some of the things I like because of the recession How my parents are doing money-wise The condition of planet Earth that will be left to my generation How attractive I am to others How I’m doing in school Which college I/my family can afford Source: JWT, 2009 Which college will accept me How many friends I have How popular I am at school How I’m doing in extracurricular activities Keeping up with what other kids my age have Base = 100 293 251 249 221 201 180 151 143 92 78 75 73

27. 75% are getting more or the same allowance as last year parents grandparents, aunts & uncles jobs (babysitting, dog walking, etc.) eBay, Craigslist allowance Source: Seventeen survey, 2009

28. “ I’ve now seen how quickly a recession can come on and how long it can take to get out of one. I’d like to set a good example for my children and teach them to be smarter with their money.” “ It has been a tremendous lesson in how to live within your means and separate wants from needs. ” — Pamela, 47 — Alanna, 34

29. RECESSION DIGITAL MOMS

30. RECESSION BRAND SHOPPING DIGITAL

32. “ I feel good because I can actually save my money before I make a purchase. I feel that I’m handling my business as a young man should.” 69% of young people now research all purchases before they buy anything. Source: OTX, May 2009 — John, 16 — Luke, 13

33. Over the next five years , moms of teens plan to: 57% consider purchases carefully 57% be more price conscious 55% stick to a budget 57% dine out less Source: BIGResearch, July 2009

34. “ My shopping habits will not change back once the recession is over. We are not lacking for the basics and still have a wonderful life. Less is more in our family now.” Coupon sites have been the second-most-visited category on the Internet—behind job sites—for about a year. Source: eMarketer, May 2009 — Blanca, 43

35. RECESSION BRAND SHOPPING DIGITAL

37. Brand loyalty is increasingly important among 13-21 year olds, as 73% now shop at a fixed group of stores . “ I’m pretty picky about clothes. They’re the hardest to give up. I notice the difference in quality so I usually compromise by buying good brands on sale. “ Source: Euro RSCG Discovery survey, May, 2009 “ I haven’t really given up any brands. I maybe don’t buy quite as much, but I still buy the same brands I always did.“ — Alicia, 18 — David, 17

38. Favorite Brands During the Recession, Resource Interactive and Harris Interactive, 2009

39. SHOPPING DIGITAL MOMS Favorite Brands During the Recession, Resource Interactive and Harris Interactive, 2009

40. “ I’m not really into any specific brands anymore. I realized that I don’t need a $300 purse as much as my kids need clothes and food.” “ Definitely more Target shopping going now .... previously it was Nordstrom, Coach, Dior.” 43% are buying store brands instead of national or high-end brands. Source: TNS Retail Forward, August 2008 — Keri-Anne, 32 — Sheryl, 49

41. RECESSION BRAND SHOPPING DIGITAL

43. “ There’s a mini-generation gap between under-twenty and over-twenty Gen Y’rs, due to the swift progression of technology in the past two decades.” — GenBuY, October 8, 2009

46. “ Today’s teens are so focused on communication that iPhones are the new jean. ” Most of 8-14 year olds report having online chores including sharing pictures with relatives (38%) and getting driving directions (35%). Source: GenBuY, October 8, 2009 DIGITAL = Teenage Freedom Source: AdAge.com, April 2009

47. “ I will almost always check online ….even if I’m going to buy it in the store.” — Louise, 49 “ I’m a serial Googler.” “ SECRET” SHOPPERS 40% of total online spending came from $100K HH consumers, who increased shopping by 17% in Q4, 2008. Source: comScore, 2009 — Tracee, 51

48. Moms with teens said the internet... 46% Helped me save money through access to easier price comparisons, coupons, and deal alerts. 41% Helped me become a smarter shopper; product reviews and ratings, blogs, and product information has helped me make more informed purchases. 21% Helped me make money through selling things I no longer need on sites like Craigslist, eBay, etc. SHOPPING DIGITAL MOMS Source: BIGresearch and Resource Interactive, August 2009

50. UNDERSTAND THE REWIRING DECONSTRUCT THE (CO-) SHOPPING JOURNEY

51. I WANT I NEED I WANT TEENS: MOMS: EVALUATE RATIONALE NEGOTIATE COORDINATE PURCHASE OBSERVE & RE-ARM DESIRE BUILD THE CASE PRESENT THE CASE NEGOTIATE ACQUIRE SHARE & SWAP DIFFUSE SELF- EDUCATE Check Lucky at Your Service app Earmark magazine ad Stream fave TV show on Hulu Check out comparison shopping sites Search past emails for promo codes Google “coupon” + brand name Post Q. on favorite mom blog Google item Poll friends on Facebook wall Check Mobile SMS Visit the web site Text friends about meeting at mall Downloadfilm trailer to iPhone Visit brand/store site and build wish list Check teen’s shopping cart Check her PayPal Student Account Check store for clearance Review items held in cart Assign more chores in exchange for $ Send phone pix to Mom from store Discuss upcoming gift cards Post outfit on Polyvore Upload pix to Facebook fan page Ratings & reviews List new item on Craigslist Wear to game & take snaps Say yes on Bill My Parents

53. UNDERSTAND THE REWIRING DECONSTRUCT THE (CO-) SHOPPING JOURNEY INNOVATE YOUR WAY OUT

54. TEENS (still) want a continuous stream of new items in their lives because they are overstimulated and they care what their friends think and have. However , they often have to justify their desires to parents. MOMS want to teach their kids smart shopping because they have learned valuable lessons from the recession. However , they feel guilty bringing more stuff into the household.

61. Generally receptive overall —“neat,” “cool” and “useful” Reuse concept is unique and appealing with strong interest in swapping with others Option of setting communication preferences or having offers consolidated didn’t seem unique (not fully understood) Generally receptive overall – “cool,” “helpful” and “user-friendly” Reduce/reuse appealing; perceived as reducing waste Appreciates how the personalized experience makes finding her promotions easier and ensures she’ll not miss out on a good deal. TEENS MOMS

62. MOMS do not enjoy shopping with their teens because they are unfocused and inefficient. However , moms need to see what teens have in mind to provide guidance, consent and payment assistance. TEENS do not enjoy shopping with their moms because they crave independence and time with friends. However , connectivity with mom is essential to getting timely consent and access to funds.

73. Receptive overall – “cool,” “fun” and “something new” Downloading a brand-specific app for this purpose was too time-consuming, complicated Like that they can get pre-approval from Mom and solicit input from friends Mixed overall – “cool” and “innovative,” but “too many steps’’ Good way to participate in bigger purchases “ Get the OK to buy” and "Bill My Parents" was perceived to be irritating, potentially unsecure or encouraging more shopping TEENS MOMS

74. MOMS want to feel smart about how they maximize their shopping because they have budget limitations. However , this isn’t much fun because there’s no room for impulse. TEENS are impressively savvy with their OWN money because they “feel” the transaction more fully. However , they need help shopping within a budget.

79. Very receptive overall – “cool,” “creative” and “handy” Most indicated this saves time and makes it easier (and more fun) to shop within their budget Some suggested it makes them smarter about money Very receptive overall – “more efficient,” and “helps me get the most for my money” Some questions/concerns about shipping, “hold it” details and in-store pick-up See the promise for their teens, as it would teach spending within their means; and ideal for holiday shopping TEENS MOMS

81. Support consumers as marketers and merchandisers! ??? Autofill codes, points, and special offers; deal expiration alerts Support social marketing and merchandising Monetize your Facebook page Add Raves to your Ratings & Reviews Get more relevant at the shelf level

82. Use messaging to tap into thrift mentality Make meaningful service changes based on feedback Use social networks to share shipping codes or offers Introduce new products and price points Shift the dialog Offer new utility/fun

84. thank you. COMPLIMENTARY PRESENTATION FILE: [email_address] www.resource.com by Kit Yarrow and Jayne O'Donnell Special thanks to our research partners: