1 in 5 Americans tweak spending after Donald Trump's election win
Nearly 1 in 5 American adults – about 47 million people – are believed to have changed their spending habits in the aftermath of President Donald Trump's Election Day victory back in November.
And that could be a blessing and a curse for companies who've taken a stand for or against Trump's agenda, as both Republicans and Democrats are redirecting their cash to companies and nonprofits that support consumers' respective political preferences.
A new report from Lincoln Park Strategies, a research outfit that surveyed the spending patterns of 1,000 U.S. adults from across the country, found that 19 percent of respondents "say their spending habits have changed."
"But what should be of even bigger concern for companies is that half of this cohort – roughly 23.5 million people – say they are now buying from direct competitors of the companies they feel do not align with their own ideals anymore," the report said. "Additionally, over one third (36 percent) say they have stopped spending money at a certain company and instead have given that money to a non-profit that focuses on an issue important to them."
Anecdotal reports have surfaced in recent months involving boycotts of certain companies that have appeared to fall in line with Trump or oppose his agenda. Perhaps none was more public than Nordstrom's decision to drop Ivanka Trump's clothing line. Calls for the department store to drop the president's daughter's line had surfaced from left-leaning activists in the weeks prior to Nordstrom's decision, due mostly to Ivanka's proximity to her father.
The company cited "the brand's performance" as the primary reason it chose "not to buy it for this season." But some Trump supporters viewed it as a politically motivated stunt by the company and called for an Ivanka Trump buying spree and a boycott of Nordstrom. Kellyanne Conway, counselor to President Trump, even raised ethics concerns last month when she appeared on Fox News to urge viewers to "go buy Ivanka's stuff."
Despite – or perhaps because of – Nordstrom's decision, Ivanka Trump-brand president Abigail Klem said in a statement earlier this month that the brand has enjoyed its "best performing weeks" in its history "since the beginning of February."
Similarly, calls to boycott ride-share outfit Uber surfaced after the company was accused on social media of attempting to profit off of riders getting to and from a January Trump protest at John F. Kennedy International Airport in New York City.
At the time, company CEO Travis Kalanick served on a White House business advisory council. He resigned from that position shortly after the controversy erupted.
Starbucks, Under Armour, McDonald's and even tourist destinations in Hawaii have faced similar boycott calls in recent weeks. The nature of Trump's business experience – and the fact that his name has been crafted into a brand in a manner difficult to draw a parallel to throughout the history of the Oval Office – made changes in consumer spending somewhat predictable in the aftermath of his presidential victory. Add to that his polarized public standing ranking him among the least popular presidents to take office in recent history, and it was in some ways to be expected that some folks would opt out of buying – or to throw their money toward – a new Trump tie, for example.
But less predictable were the slew of recent boycotts that impact businesses well beyond Trump's own reach. And given the boycott trend's relative recency, relevant quarterly earnings reports that might show a consumer uptick or downturn have yet to be released. So it was difficult for analysts to estimate just how many consumers were putting their money where their hashtag was.
But Thursday's study from Lincoln Park Strategies suggests millions of consumers across the political spectrum have adjusted their spending habits in response to Trump's presidency, though it appears Democrats have been more likely to shun companies viewed as sympathetic to the president than Republicans have been to back away from outfits that have appeared to slight Trump.
"Democrats are more likely to have answered affirmatively (25 percent) than Republicans (18 percent) and Independents (14 percent)" when asked if they had changed their spending habits, according to the report. "These numbers are similar when we look at those who voted for Clinton (26 percent have changed their spending) and those who voted for Trump (16 percent)."
Women were only slightly more likely than men to have changed their spending habits, with 20 percent indicating they'd made an adjustment compared with 18 percent of their male counterparts. But differences were minimal in terms of household income – the rich were about as likely as the poor to have made a change, despite their greater ability to pick and choose where they spend their money.
When age was factored in, though, the report returned more polarizing results. About 25 percent of women under the age of 45 said they'd made some sort of change since Trump's electoral win, while only 18 percent of men in that age group did the same. Only 9 percent of those at least 65 years old, regardless of gender, shifted their behavior.
"Ever since Donald Trump's election, we have seen companies stake their claim as pro or anti-Trump and his policies, whether purposefully or by accident," the report said. "The reactions from companies have been varied as well; some have embraced the attention and tried to harness the free publicity, while others have reacted to the newly administered pressure and tried to avoid, or mitigate, the wave of angry consumers from either side of the political spectrum."
The report expands on polarized consumer confidence data that in recent months has shown a surge in sentiment for Republicans and Trump supporters against a marked downturn in optimism among Democrats. The University of Michigan's most recent consumer sentiment report was up 7.3 percent over the year in the first few days of March, with the sub-index measuring how Americans feel about current economic conditions climbing to its highest point since 2000.
But Richard Curtin, the chief economist at the university's Surveys of Consumers outfit, said in a statement accompanying the report that the overall index – and, in particular, the sub-index measuring future expectations – has been complicated by a deep "partisan divide."
"[A]mong Democrats, the expectations index ... signaled that a deep recession was imminent, while among Republicans, the index ... indicated a new era of robust economic growth was ahead," he said. "This combination will result in uneven spending gains over time and across products."
Thursday's Lincoln Park Strategies survey appeared to back up the university's findings, noting that Trump's supporters "are much more optimistic about the future of the United States' economy than they were prior to the election."
"Conversely, Clinton supporters have moved in the opposite direction," the report said. "However, it was a bit of a surprise that Trump's supporters not only have high expectations for his presidency, but they also view their own economic situation in a different light than they did prior to the election – even though little has probably changed in their daily lives given the short time since Trump took office."