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CITY RETAILERS FACE TOUGH CHRISTMAS SEASON, SURVEY INDICATES

 CITY RETAILERS FACE TOUGH CHRISTMAS SEASON, SURVEY INDICATES
 PHILADELPHIA, Nov. 27 /PRNewswire/ -- Philadelphia retailers stand to take a bigger hit from the recession this holiday season than their suburban counterparts, according to a newly released five-county regional survey of consumer buying intentions.
 The survey of 408 randomly chosen households in Philadelphia, Bucks, Chester, Delaware and Montgomery counties by marketing professor Michael Smith of Temple University's School of Business and Management with JRP Marketing Research Services was conducted during the week of Nov. 14-21. It is the first in what Smith expects to make an ongoing series that monitors consumer sentiments, intentions and behavior in the region.
 City and suburban residents alike overwhelmingly said they would be spending the same or less than last year (85 percent of city residents, 89 percent of suburbanites). Overall, an ominous 42.5 percent of all those surveyed are planning to spend less, while only 12 percent plan to spend more.
 Given the tightened purse strings, where will area consumers go to do their shopping?
 Among Philadelphia residents, two-thirds of their purchases (65.6 percent) will be made in the city, with one-third of their gift- buying done outside the city. Suburban people, however, are clearly not heading to Philadelphia this shopping season: 90.3 percent of their holiday buying will be outside the city, with only 8.2 percent of their purchases being made in Philadelphia.
 "The city has to do a better job of marketing itself to the suburbs," Smith said. "With 90 percent of suburban residents' shopping dollars staying outside the city, and a significant one-third chunk of Philadelphians' dollars flowing out of the city this year, it's not too early for merchants to begin thinking about marketing strategies for Christmas 1992."
 Respondents were also asked to compare their in-the-city vs. outside-the-city gift-buying intentions this year with those of last year.
 Most haven't changed their shopping patterns: 71 percent of Philadelphians and 85 percent of suburbanites said they would be the same. However, nearly 19 percent of city residents said they would be buying less in the city, with 9 percent buying more and 7 percent doing no shopping at all in Philadelphia. A disheartening 70 percent of residents of the surrounding counties said that they would do none of their shopping in Philadelphia; 10 percent will buy less in the city and 3.5 percent will buy more.
 Those surveyed were also asked to estimate what they considered "a reasonable amount of money for households like yours to spend on holiday gifts." The results show a big difference in anticipated spending between city and suburban people: overall, it was $547 for Philadelphians and $714 by suburban residents.
 "Christmas does not look as good for Philadelphia retailers as for suburban merchants," said Smith. "With more money being spent by suburbanites -- who don't shop in the city -- and a significant portion of Philadelphians' purchases taking place outside the city, suburban retailers will not get hurt as much."
 The survey also showed the region's population reflects the general consumer malaise of the recession that refuses to go quietly away, Smith said. "Most people see themselves as worse off than households similar to their own, and what people think shapes what they are going to do.
 "We have an attitude problem here. When people think they're not doing well, it keeps them from spending. What's needed is some leadership to get the economy off center."
 The survey also questioned respondents about their gift-buying intentions in specific merchandise categories. While people intend to buy less across the board this holiday season, certain items held up better than others over last year: While 55 percent said they purchased outerwear (coats, jackets, etc.) last year, only 25 percent expect to buy them this year. Electronic toys fell from 45 percent purchased last year to 25 percent anticipated this year.
 Appliances dropped off from 37 percent to 12.5 percent, and home entertainment slid from 36 percent who made purchases last Christmas to just 11.5 percent planning to buy this year.
 While big-ticket luxury items don't do well when the economy is weak, Smith also noted that most households have reached the saturation level. "They already have a VCR, and even if their refrigerator is too small, or they want a fancier stove with a built-in microwave, people don't trade up in a recession."
 Gift items that will weather the economic storm well include jewelry, fragrances and toy figures such as GI Joe and the Teenage Mutant Ninja Turtles.
 "There's bound to be a shakeout among retailers," Smith said. "The good old days of growth in Christmas expenditures are gone. The pie is not getting any bigger as it did in the 60s and 70s and into the 80s. We have an aging population, rising taxes and an increase in the cost of living at the same time that consumer debt is not lessening.
 "The retailers who will survive and do well are those who are focused and have identified their customers, offer the right merchandise assortment, price value and service."
 Due out next week: results of a survey of Philadelphia-area consumers on their quality of life and expectations for the economy.
 /delval/
 -0- 11/27/91
 /Editors: Smith may be reached at his office, 215-787-1682, or at his home, 215-368-9607. Or, call Harriet Goodheart at Temple's News Bureau, 215-787-7476./
 /CONTACT: Harriet K. Goodheart of Temple University, 215-787-7476/ CO: Temple University; JRP Marketing Research Services ST: Pennsylvania IN: REA SU: ECO


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