Southern California Consumers Optimistic About Economy

(Business Wire — August 4, 2001) Southern California consumers are optimistic about the economy’s future, andwill be demonstrating that enthusiasm by spending at least the same amount ormore this year on back-to-school shopping versus last year, according to the”2001 Back-to-School Shopping Outlook Survey — Southern California,” a studyreleased today by Deloitte & Touche LLP. Over half (59%) of the families withschool-age children surveyed plan to spend $200 or more per child onback-to-school clothing, which most (87%) say is about the same or more thanthey spent in 2000. The majority of the respondents (70%) expect the economyto stay the same or improve in the next 12 months.

In San Diego, the survey respondents were slightly less optimistic than theregion overall: 67% expect the economy to stay the same or improve in thecoming year, with nearly 57% planning to spend $200 or more on back-to-schoolclothing.

“Consumer sentiment regarding back-to-school spending is an encouraging signfor retailers who have recently suffered from flat-to-negative comp storesales trends,” said Theresa Drew, managing partner for the San Diego officeof Deloitte & Touche.

The additional findings of the study included:

Internet Shopping Levels Off; Inability to Try On Clothing and Security WoesRemain

Online shopping appears to be leveling off, with 13% of respondents planningto buy their back-to-school items via the Internet this year, compared to 13%in 2000. The obstacles to Internet shopping still remain, with the inabilityto try on clothing as the most often cited response for not using theInternet to purchase back-to-school apparel (48%). Other major obstaclesmentioned were security worries (20%), limited selection (12%), lack of acomputer or Internet access (11%), expensive delivery/shipping charges (10%),inconvenience (9%), and discomfort with Internet transactions (8%).

In San Diego, Internet usage mirrored that of the Southern California regionoverall, with 13% of respondents planning to do their back-to-school shoppingvia the Internet, compared to about 15% last year.

Department Stores Replace Discount Stores as Favored Shopping Venue

More families plan to do the majority of their shopping in department stores,39% this year, versus 38% last year. Additionally, 33% prefer discountstores, versus 44% last year; and 20% favor specialty stores, versus 29% lastyear.

Department stores are also the venue of choice for San Diego shoppers (41%),compared to discount stores (36%), and specialty stores (17%).

Catalog Shopping Still Popular

While a larger number of Southern California respondents (20%) plan to shopvia catalogs rather than online, that number dipped slightly from last year(22%). As in past years, older shoppers were more apt to say they’d usecatalogs; 25% of those aged 45 and older plan to do so, versus 15% of thoseaged 35-44, and 17% of those under age 34.

Quality Merchandise Continues to Be Important Attribute

Southern California consumers continue to rank quality merchandise as themost important attribute (96% of respondents) they look for when consideringwhere to shop for back-to-school. Other important factors included low prices(94%), convenient store location (92%), large selection (91%), and goodcustomer service (91%).

San Diego shoppers ranked quality merchandise and low prices of equalimportance (97% each), with a large selection and convenient store locationtying for second place (92% each).

Gap and Quiksilver Oft Mentioned “Must-Have” Brands; Skateboard ClothingSought

Slightly more than a third (36%) of parents said they planned to buy specificbrands, a sizable increase from last year (26%). The most often mentioned”must-have” brands were Quiksilver and Gap (17% each), followed by Levi’s(12%), Old Navy (10%), and Roxy (7%). Skateboard clothing or other items (12%of mentions), and jeans (9%) led the most cited items.

Other supplies parents will stock up on this back-to-school season includebackpacks (45%), plus the obvious pens, pencils, and notebooks. Skateboardsand scooters, popular in previous years, were rarely mentioned this year.Other items that kids were clamoring for included glitter, cosmetics, cellphones, CDs, and hand-held and other computers.

August Remains Biggest Back-to-School Shopping Month, But Many Waiting UntilSeptember

The majority of respondents (72%) plan to do their back-to-school shopping inAugust, while increased numbers (14% this year versus 9% last year) werewaiting until September. A few (6%) had already hit the stores in June andJuly.

About the Study

The “2001 Back-to-School Shopping Outlook Survey — Southern California” wasdesigned to gauge consumer opinion about how much they plan to spend thisseason, where and when they plan to shop, and what is important in aretailer. Deloitte & Touche conducted the survey of 400 Southern Californiafamilies with school-aged children. Phone interviews were conducted in lateJune and early July.

About Deloitte & Touche

Deloitte & Touche LLP, one of the nation’s leading professional servicesfirms, provides assurance and advisory, tax, and management consultingservices through nearly 30,000 people in more than 100 U.S. cities. The firmis dedicated to helping our clients and our people excel. Known as anemployer of choice for innovative human resources programs, Deloitte & Touchehas been recognized as one of the “100 Best Companies to Work For in America”by Fortune magazine for four consecutive years. Deloitte & Touche is the USnational practice of Deloitte Touche Tohmatsu. Deloitte Touche Tohmatsu is aSwiss Verein, and each of its national practices is a separate andindependent legal entity. For more information, please visit Deloitte &Touche’s web site at www.us.deloitte.com.