Tuesday, October 11, 2011

Study finds Rise in College Student’s Purchasing Power

re:fuel released its 11th annual College Explorer survey, according to Marketwatch.

The recent findings shows that the more than 20 million new college students’ spending power set a new record with $417 billion dollars, a 14% jump from last year’s study.  Overall discretionary spending for this population was $76 billion.  The article acknowledges that part of the growth in spending power is due to rising tuition costs and higher education costs.  Here are some other notable findings of the study discussed in the article.

Food is a major discrectionary spending area.  Discretionary spending on food increased by 39% since last year's study and accounts for almost half (46%) of college students' total discretionary budget.  Of the $35.2 billion reported towards food spending - $20 billion is being spent on groceries, $12 billion in restaurants and $3 billion in convenience stores.  Nearly all students (90%) report visiting a grocery store in a typical month, and they do so more than once per week (4.7 times a month).  These numbers suggest that food is a potential growth category for college stores.
On the technology front, students report that on average they now own six digital devices and spend a cumulative 11.4 hours per day using technology. Cell phones are quickly being replaced by smart phones.  Cell phone ownership decreased from 84% of students in 2010 to just over half (55%) in 2011.  Smartphone ownership  jumped more than 61% in the same time period.  In 2010, just one quarter of students (26%) reported owning a smart phone device, and that figure rose to 42% in 2011.  20% of students expecting to purchase a smartphone  in the year ahead. This places it ahead of other coveted items like laptops (17%) and tablet computers (11%).

Related to social media, a full 88% of students are Facebook users and 25% use Twitter, a slightly higher engagement over last year.   53% have followed or "liked" a brand on Facebook, and only 16% have done so on Twitter. Students who say they "friended" a brand in order to be the first to know about company news dropped from 48% last year to 40% in the current survey. Forty-eight percent (48%) of students have followed a brand's social networking page to take advantage of special offers and just 22% regularly read a brand's page for updates. Of note, more than 44% of students reported actively avoiding ads on social media sites, placing them among the most avoided media types.

The survey reports on several other statistics as well and the full report is worth reading.

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