As the American economy continues to move sluggishly, African-American households are curtailing their spending in many categories, including food, clothing and basic household items, while investing more in home repair, home entertainment and consumer electronics. Although they are trimming back, black consumers are still spending more than their white counterparts on most of these products.
According to the newest edition of “The Buying Power of Black America†report, African-American households are tightening their belts when it comes to dining out, expanding their wardrobes, and leisure activities out of the home. At the same time, they are increasing their spending on home repairs and remodeling, audio and visual electronics, and online purchases of books. The report also estimates that black households collectively had earned income of $679 billion in 2004.
According to the report, black households had $679 billion in earned income in 2004, an increase of 3.5% over the $656 earned in 2003.
Among the products and services that showed the greatest one-year increase were sound systems (+127%), computer online services (+38%) and sports and recreational equipment (+19%), dishwashers (+ 42%), washing machines (+45%), and contributions to churches (+19%).
â€This change in expenditures by black consumers means that obtaining and holding on to their loyal will be more competitive for marketers,†said Smikle. “This represents a time of opportunity for those companies that can demonstrate they are serious about providing value for these customers.â€