Courting the Next Wave of Customers

Today’s teenagers are far more family oriented than their parents were at the same age. According to a recent survey by The Harrison Group, American teenagers’ top three passions are family, friends, and music.

The survey, which polled 1,277 teens ages 13–18, was conducted in October and November of 2007. The 45-minute online survey was balanced for gender, race, region, and household income and has a margin of error of plus or minus 3 percent. The survey includes two elements of note: an analyzable sample of Hispanic and African-American teens and an over-sample of affluent and wealthy teens (i.e., those living in households with more than $150,000 annual income).

Among the key findings of the survey were:

Family is important. Fifty-four percent of teens surveyed live in a nuclear family with both parents, and 59 percent say their family eats dinner together at least four nights a week. Eighty-five percent identify a parent—rather than a peer—as their best friend. Of these, 53 percent say Mom is their best friend, and 32 percent say it’s Dad. Teens overall are much more comfortable talking to Mom rather than Dad about almost every subject except sports.

Middle class values. Eighty-nine percent of teens identified themselves as middle class. Many of the affluent teens surveyed also identified themselves as middle class. In terms of actual figures, 51 percent of teens surveyed live in households with less than $50,000 annual income, and 19 percent live in households of $51,000 to $74,900 income, but almost one in three (30 percent) live in borderline-affluent or affluent homes (annual income of $75,000 or more).

Teen spending power. The U.S. Census Bureau says there are 25.3 million teens ages 13–18. With an average annual income of $2,634, (from allowance, gifts, and part-time work), plus $5,496 of their parents’ money that they spend every year, that’s $216.3 billion in teen spending power. The survey also found 46 percent of respondents have a job; they work an average of 14.4 hours per week and earn an average of $474 per month. For many teens, this is pure disposable income. For those without responsibilities toward household expenses, it may be more disposable income per month than their parents enjoy.

Teens shop. Sixty-one percent of teens surveyed agreed with the statement “I love to shop.” Shopping is as much a social experience as a material one, as 71 percent of teens who love to shop say they love to shop in malls, and 64 percent say they love to shop with friends. Despite their love of malls, teens are more likely to shop in big-box stores. Among all teens, Wal-Mart was the No. 1 answer to the question “Where do you shop?” Among girls, Target rated No. 1, and among boys, it was Best Buy. Among affluent teens, Best Buy ranked No. 1 overall, Barnes & Noble was second, and Target ranked third.

The top five spending categories are clothing/apparel, food, snacks/candy, eating out, movies in a theater, and video games and equipment. Food and video games are the top two spending categories for boys; for girls, clothing and food rank highest. For affluent teens (both genders), clothing is No. 1 and movies in a theater ranks second. Fashion accessories (apart from apparel) are the No. 6 spending priority for teen girls.

Teens are price conscious. Sixty-seven percent say they prefer to shop in stores with a reputation for great pricing, and 58 percent wait for something to go on sale before they buy it. And while only 28 percent said they’d buy an expensive piece of jewelry at a store like Costco or Sam’s Club, the figure rose to 33 per-cent among affluent teens.

Forty-two percent (vs. 77 per-cent of their parents) made a purchase online within the six months prior to the survey, and the average spent there was $204. Just under half (49 per-cent) have their own credit card, and, of those, 52 percent pay the bill themselves.

Multiculturalism is a way of life. While 60 percent of today’s teenagers are non-Hispanic white, that proportion is expected to drop to 50 percent by 2050. There already are far more teens of two or more races than any other population segment.

Diversity, however, does not necessarily equal harmony. Seventy-five percent of teens say racism is a problem. And among teens who say racism is an issue, not surprisingly, the feeling is strongest among African-Americans and Hispanics. Ninety percent and 85 percent, respectively, cite racism as a problem, whereas 68 percent of white teens feel it is an issue.

Altruistic teens. Teens value money—70 percent wish they had more—but they also believe in giving back when they can. Forty-four percent (51 per-cent among affluent teens) are willing to pay a premium for brands that support charitable causes. Thirty-three percent have donated money directly to charity, and 31 percent have volunteered time to a local charity. Among affluent teens, those figures rise to 48 percent and 45 percent, respectively.

Altruism aside, 75 percent of teens want to make a lot of money in their lives, and 70 percent say they know what they want in life.