A group of American consumers has surprised economists and businesses with their spending behavior. Those known as YOLO (‘Carpe diem’) ‘squandered’ money on Taylor Swift concerts, trips to Paris or going out to dinner even though their savings dwindled. According to Bloomberg, YOLOs are a group that supports the premise of “you only live once”, which emerged strongly during the coronavirus pandemic. Since the start of Covid-19, these types of consumers have spent a lot of money on vital and enriching experiences.
The Executive Director of the Cruise Operator Carnival Corp. assured analysts at the end of September that the companies “apparently there are higher prees prees prees prees prees upations regarding the state of the consumer, after users are booking.” More Than Ever “Cruise travel. The objective is therefore to continue “prioritizing spending on experiences over goods.”
An example of a YOLO consumer is Carli Simpson. A 25-year-old executive assistant and her partner – Bloomberg reports – have decided to give up physical rules for the first time and travel to Colorado in January and Florida in March of next year. And the trip allows them to enjoy more time together: “The pandemic prevented us from going anywhere,” the young woman tells the agency.
Boosting gross income in the US
The young woman is just a sample of the large group of people who are committed to enjoying the now and spending has helped boost gross income in the United States, and allowed the country’s GDP to grow in the fiscal quarter at its fastest rate in almost two years. Despite this, experts warn that the YOLO phenomenon does not prevent a slowdown in the country in the coming quarters, or even a recession. There are even signs that wealthier buyers are stepping back.
Savings have been progressively decreasing since the peaks of the coronavirus pandemic, although the trajectory of inflation has moderated, its constant increase has exceeded salary increases, which has caused obstacles to consuming more per part of the citizens. The panorama has become a challenge for many companies, especially those that sell clothing or appliances.
Music concerts are going strong in 2024
But with US unemployment near record lows, consumer spending has defied expectations and experience-focused companies have an advantage. Live Nation Entertainment Inc. is an example: the owner of the famous Ticketmaster sees record levels of concert demand for next year, even after an exceptional summer led by music icons such as Taylor Swift or Beyoncé. Additionally, company executives also announced Puerto Rican rapper Bad Bunny’s upcoming tour as part of a “strong concert schedule” for next year.
Other sectors such as airlines, hotels and luggage have experienced an increase in income for ten consecutive years, although the pace has moderated. Firms such as Delta Air Lines, Marriott International or Samsonite have benefited from the interest in travel from YOLO consumers. And the number of Americans who say they are considering traveling to a foreign country in the coming months is at its highest level, according to a survey of consumers conducted at the end of October. All of this despite a drop in consumer confidence, which is at its lowest level in the last five months, according to the same survey collected by Bloomberg.
“When things are going well, you take advantage of them,” says Kam Sidhu, 46, owner of a Montessori school and some fast food restaurants. Along with his daughter and a friend of his, he planned to see the Macy’s Thanksgiving Day Parade and some Broadway shows in New York. The family is also planning a cruise to celebrate the new year. In the purest YOLO style. However, this consumer is cautious about the economic situation due to the war between Israel and Hamas, in addition to taking into account the upcoming United States presidential elections. “We need to be out there with each other; just human experience, being together,” he says.
Response to high demand
In response to increased demand, United Airlines Holdings is expanding flights to some international destinations this winter. American Airlines and Delta are also working on this aspect, which will add more routes and new cities by the summer of 2024, mainly to tourism-focused areas throughout Europe. As far as the domestic market is concerned, demand has indeed decreased and travel discounts have increased with the aim of trying to ‘seduce’ travelers.
Samsonite CEO Kyle Francis Gendreau told analysts a few weeks ago that he sees “tremendous momentum as we think about the end of 2023 and the beginning of 2024,” particularly in North America and Europe. And the data shows that luggage sales increased by 22% in the third quarter compared to the same period of the previous year.
Going out to dinner is a trend
Dining out has also become a big part of YOLO consumers. Starbucks chief marketing officer Brady Brewer says that “the younger you are, the more likely you are to waste money in restaurants and bars: it becomes the only place you want to spend.”
Less electronics and clothing
Meanwhile, many small businesses report that spending has been slowing on appliances, electronics or clothing. Target CEO Brian Cornell told analysts that there have been quarters in which traditional goods have fallen in both dollars and volume across the industry. Also of the same opinion is the CEO of Macy’s, Jeff Gennette, who noted last week that consumers “are under pressure and in some cases, moving towards experiences away from our traditional categories.” Macy’s sales fell 7% in the last quarter, although they hope that discounts on textiles for Black Friday will give a final push at the end of the year.
Ultimately, companies are trying to adapt to consumer preferences for life experiences rather than physical goods. The owner of Kay Jeweleres and Zales, of Signet Jewelers, is turning the jewelry business around by offering, for example, personalized purchases with the aim of boosting declining sales. Shoppers can use augmented reality in stores and online to choose an eyeglass frame or a specific gemstone for an engagement ring, or work with a jeweler to design a piece from scratch. Everything is to ‘reinvent’ and conquer a new era of consumers.
THE NAIS IS OFFICIAL EDITOR ON NAIS NEWS