Tag Archives: Shopping

Guess How Much Americans Spend Drunk Shopping Online?

A new survey reveals that nearly 80% of people who drink alcohol have shopped on the web while intoxicated. 

And while the results can be hilarious, drunk shopping is a multi-billion dollar national habit

According to a survey by tech and business newsletter The Hustledrunk Americans spend approximately $45 billion per year, with an average annual spend of $444 per drunk shopper.

Most common? Clothing and shoes, while Amazon remains the shopping platform of choice. 

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The findings are based on a survey of 2,174 alcohol-consuming readers between March 11-18 of this year. The average respondent was 36-years-old, and has an income of $92,000 per year, more than double the national average. Thus, The Hustle‘s wealthier readers may skew the results when extrapolated – but we’re having fun with this one. 

Overall, 79% of all alcohol-consuming respondents have made at least one drunken purchase in their lifetime — though this varies a bit based on demographics. –The Hustle

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Women (80%) are slightly more likely than men (78%) to drunk shop. This makes sense since women generally shop more than men — especially online.

Drunk shoppers also tend to be younger. Millennials outrank baby boomers by 13%, which might be attributed to the rise of e-commerce (we’ll get to this later).

Certain professionals also seem to be more inclined to shop drunk than others. We limited our data to jobs with the highest response rates then parsed out the 5 industries that are most and least likely to shop under the influence. –The Hustle

What’s the alcohol of choice while drunk shopping? Beer, followed by wine, followed by whiskey.

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Another interesting metric is that people who shop while drunk have around 10 drinks per week, while those who typically shop sober consume half as much

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As far as average spent per year: 

Our average respondent reports dropping $444 per year on drunk purchases — from life-size cut-outs of Kim Jong-un to 30-pound bags of Idaho potatoes.

A little back-of-the-napkin math gives us a rough estimate of the drunk shopping market at large: There are ~130m alcohol-consuming adults in the US. In our survey findings, 79% of alcohol-consuming adults shop drunk at an average annual spend of $444. Assuming these rates hold true at a national level (purely speculative), drunk shopping is a ~$45B per year market.

Extrapolating this further, we determined the average lifetime spend on drunk purchases is $4,187 — good for a total drunken expenditure of nearly half a trillion dollars.

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When it comes to drunk shopping by profession, those in the fashion industry are the biggest, richest drunks – at an average of $949 spent per year, followed by writers, medical professionals and those in the fitness industry. 

Who spends the least while shopping drunk? Government workers, engineers and – in last place, those working in retail.

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Geographically speaking Kentucky is oddly at the top along with Connecticut. Though, the survey may have had one really rich respondent in each state that skewed the results. Who knows. 

Kentuckians top the charts with a $742 annual spend. In fact, the entire South — a region known for its fine bourbon — is a blanket of red. California, the country’s wine capital, is the lone over-achiever on the otherwise mediocre West Coast.

This bears little semblance to the CDC’s analysis of the heaviest binge-drinking states (in fact, it’s almost opposite). But it shows that the economics of drunk shopping is a more complex matter than simply parsing out where people drink the most.

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As far as platform of choice, Amazon leads the pack, followed by Ebay, Etsy, Target and Walmart. At least two of those are worth an intervention if you ever catch your friends drunk shopping at Walmart, for example.

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Clothing and shoes are the goods of choice while drunk.

Studies have shown that people who base their self-worth on appearance are more likely to imbibe alcohol, so there is some tenuous linkage here. But this also ties in with the rapid rise of the direct-to-consumer fashion industry.

Entertainment (movies, games) and tech gadgets are also popular choices — though the party train seems to abruptly halt at software (if you’ve purchased a copy of Microsoft Excel drunk, we need to talk.)

Weirdest purchases, according to The Hustle‘s readers?

  • 200 pounds of fresh, 10-foot tall bamboo
  • A World War 2-era bayonet
  • A full-size inflatable bouncy castle (“For my living room”)
  • A breast pump (“I’m a dude”)
  • A splinter that was removed from the foot of former NBA Star, Olden Polynice
  • The same vest Michael J. Fox had on in Back to the Future
  • A $2,200 pair of night vision goggles
  • Tons of international fights (Azerbaijan, Iceland, Ukraine, Tunisia)
  • An NRA membership
  • A trilogy of Satanic religious books

Who could regret $2,200 night vision goggles?

Source: ZeroHedge

Dead Mall Stalking: One Hedge Fund Manager’s Tour Across Middle-America

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For the past few years, most retailers have struggled. Of course, it’s easy to blame Amazon.com, but it is only one of many causes. At the same time, for us hedgies living in major cities with luxury malls, there is confusion about the problem itself – my mall is crowded and people are shopping. After having debated with friends endlessly on what the real root of the problem is, I decided it was time to actually go investigate. Every city has its own story and the local mall is the nexus of that story.

In my mind, the only way to get real answers was a 4-day, 1,500 mile meandering road-trip through the lower mid-west, where we planned to hit as many malls and take as many meetings with facility managers and brokers as we could organize along the way. Besides, when an asset class like mall real estate is down 90% in a few years’ time, a different viewpoint can create huge upside.

The overriding question was: is retail suffering because of Amazon.com cannibalizing store-fronts or are rising health care costs, with stagnant wage growth, what’s really cannibalizing disposable spending power in middle-America? Is shopping still America’s pastime or do we prefer food and “experiences” instead? Every industry evolves. Why hasn’t the mall changed in the past three decades – it’s still the same cinema, crappy food court and undifferentiated retailers that I knew when I was a teen—where’s the fun in that? Other countries are perfecting “shoppertainment,” why hasn’t America? In summary, what is the real issue with retail?

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When you scroll through http://deadmalls.com there is a certain eeriness about a million square feet of empty space.

However, the images don’t, in any way, prepare you for an almost-dead mall on its last gasps. As we wandered one facility with the head of leasing, we could look straight ahead at a thousand feet of almost vacant space, dimly lit from sky-lights as none of the lighting fixtures still worked—the air conditioner had long ago failed and it was 95 degrees inside this mall. However, there was one light that drew us forward. As we approached, we heard music and sure enough, it was the Victoria’s Secret that time forgot (corporate probably forgot it too). In a mall with only 7 tenants and even fewer shoppers, Victoria’s Secret was still jamming out. No customers, but 2 girls tending shop, blasting music and throwing light into a dark hallway.

As we rounded another corner, we heard the unmistakable sound of a Zumba Class at 100 decibels. As we drew nearer, we saw the first mall visitors in almost an hour – what looked like an instructor with a half dozen middle-aged women trying to do exercises that they were hopelessly unfit to accomplish.

I turned to the leasing agent;

Me: Any idea how much they pay in rent?

Him: Actually, I think they’re squatting in here. I don’t show any record of them being a tenant.

Me: Is anyone going to make them pay rent?

Him: Why bother, at least it brings people to the mall…

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With no security or cleaning staff, who’s watering the plants?

All of this segwayed into the meeting with the leasing agent afterwards.

Me: Can I meet the facility manager when we’re done chatting?

Him: Funny story; actually, she quit a few months back. Unfortunately, the owner only told me last week that I am now in charge of managing this mall. I’m doing my best, but I live an hour away, so I can only come here a few times a week.

Me: So who’s been locking up at the end of the day lately?

Him: Hmmm…. Honestly, I’m not sure. That’s a pretty good question.

Me: Would anyone notice if they never locked the doors?

Him: Probably not…

Of course, you cannot quite put this into context until you realize that I was sitting there in a nearly pitch black food court, in 95 degree heat, with only a beam of light from the sky-light above to guide the conversation – yet despite the odds, one vendor still remained at the food court – ironically it was the sushi place.

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I wonder what decade these gumballs are from?? I didn’t know they could turn brown.

While the tour was entertaining, what I really wanted to know was; why did this place, surrounded by a thriving community somehow fail? This is where the story actually deviates from the usual narrative.

This mall was in a community of about 100,000 people. A decade ago, this had been a thriving mall. Then, a new major highway was placed about 5 miles west of the mall, which diverted regional traffic away from the mall. Even worse, a massive open air retailing complex was built alongside the new highway, siphoning shoppers from the mall. In a town that was big enough to support one large shopping complex, the newer one with better access from the highway had ultimately won out. However, this mall was still muddling forward with a handful of national tenants who hadn’t quite thrown in the towel, despite no lighting, air conditioning or adult supervision at the mall. It lead to a real epiphany; malls die a slow strange death—not the cataclysmic collapse depicted by most analysts.

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We saw a similar situation on the following day at another mall about 100 miles away. In this situation, a new retailing facility had been built closer to the local university to compete with the mall. This facility had stolen a number of the key tenants from the mall. At the time, it looked like this mall would also surrender to the newer facility in the better location. Instead, the mall was sold to new owners who; injected substantial capital to remodel the mall, offered discounted rent to retain existing tenants and had put up a fight to the death with the newer facility. Now, nearly a decade later, neither facility was full and both were desperately fighting it out for the minds of tenants and shoppers in a winner-take-all battle, a veritable retailing Battle of Verdun in the north of Texas—where even the winner will be a loser for having spent so much capital to win the booby prize of top retail destination in a town of about 125,000 people. Even worse, with no clear winner, new retailing concepts were hesitant to guess wrong in their expansion plans and simply chose to pass this town by when expanding—further sapping the strength of both facilities.

In fact, we continued to see similar stories as we ventured north. Retail may not be dead; instead there may simply be too much retail (both property and competing concepts) fighting it out for too few customers. This is further compounded by too much cheap capital developing more retail as a result of ultra-low interest rates. Naturally, there will be losers in this process – in fact; the losses have only just begun. There will also be huge winners.

Malls are bearing the brunt of changes in retail, but they’re only the canary in the coal mine.

Let’s start with a simple premise; commercial real estate (CRE) will change more in the next decade than it has in the past hundred years. Anyone who thinks they can fully foresee how it will evolve is lying to you. The only certainty is that highly leveraged real estate investors and lenders will be obliterated as current models evolve faster than anticipated.

In the past, retail was retail, warehouse was warehouse and office was office—the same for all other CRE classes. There was some cross-over, but the main commercial real estate components stayed segmented for the most part. Now, with big box stores, the lowest hanging fruit for online shopping to knock off, going to dodo-land, there will be hundreds of millions of feet of well-located space suddenly becoming available. People act as if there are enough Ulta Beauty and Dick’s Sporting Goods to go around. However, you cannot fill all of this space with the few big box retail concepts still expanding—especially as many stalwarts are themselves shrinking.

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As a result, a huge game of musical chairs is about to take place. Why pay $20/ft for mid-rise office space, if you can now move into an abandoned Sports Authority for $5/ft. Sure, it doesn’t come with windows, but employees like open plan space and there’s plenty of parking. Besides, with the rental savings, you can offer your staff an in-house fitness facility and cafeteria for free. Does your mega-church need a larger space? There’s probably a former Sears or Kmart that perfectly accommodates you at $3/ft. Have an assisted living facility with an expiring lease? Why not move it to an abandoned JC Penney—the geriatrics will feel right at home, as they’re the only ones still shopping there.  

Go onto any real estate website and you will find out that huge plan space is nearly free. No one knows what the hell to do with it and the waves of bankruptcy in big box are just starting. As online evolves, these waves will engulf other segments of retail as well.

Type Macy’s into Loopnet.com and look at how many millions of feet of old Macy’s are available for under $10/ft to purchase. Retail’s problems are about to become everyone’s problems in CRE. When the old Macy’s rents for $2/ft, what happens to everyone else’s rents? EXACTLY!!! What happens if a CRE owner is leveraged at 60% (currently considered conservative) and leasing at $15/ft when the old HHGregg across the street is offered for rent at $3/ft? An office owner can lower his rents a few dollars, but at the new price deck, he cannot cover his interest cost, much less his other operating expenses. What happens to a suddenly emptying mid-rise office building? It has higher operating expenses than the box store due to full-time security and cleaning—maybe it’s a zero—in that future market rents no longer cover the operating expenses of the asset, much less offer a return on investment. I know, crazy—that’s how musical chairs works when demand contracts and the supply stays the same.

What happens to the guys who lent against these assets? Kaplooey!!!

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America currently has more feet of retail space per capita than any other country. For that matter, America has more feet of office and other CRE types per capita as well. A decade of low interest rates has made this problem substantially worse. Think of the two malls that I spoke about in the last piece — they weren’t done in by the internet, they were done in by a tripling of retail space in a cities that are barely growing. These cities simply ran out of shoppers for all of this space. Now the mall is empty—heck the strip retail is only partly filled in. The next step is that rents will drop—dramatically. The owners of each asset, the mall and the strip center will go bust. Neither has a cap structure that is designed for dramatically lower rents. Neither has an org structure designed for carving up this space for the sorts of eclectic tenants that will eventually absorb it over the next few decades.

CRE has had it so good for the past 35 years, that most owners have never seen a down cycle. Sure, Dallas had too much supply in the early ‘90’s. Silicon Valley over-expanded in the early ‘00’s. It took a few years for it to be absorbed. Anyone who had capital during the bust made a fortune. This time may really be different. There’s too much supply. Short of blowing it up, it will be with us for years into the future. Without dramatic economic or population growth, some of it may NEVER be absorbed.

As an investor, this is all interesting to understand, but you don’t fully comprehend it until you have visited a few dozen of these facilities and seen how owners are trying to cope with the problem. In Miami, space is constricted. In Texas, there’s more CRE than I’ve ever seen. They keep putting it up—even if there isn’t demand currently. For three decades, they’ve always been able to fill it over time. For the first time ever, they can’t seem to fill it—in fact, demand is now declining. It is now obvious; there will be a whole lot of pain for CRE owners and lenders. Of course, someone’s pain can be someone’s gain.

Source: ZeroHedge

Retail Disaster: Holiday Sales Crater by 11%, Online Spending Declines: NRF Blames Shopping Fiasco On “Stronger Economy”

Last year was bad. This year is an outright disaster.  By Tyler Durden

As we reported earlier using ShopperTrak data, the first two days of the holiday shopping season were already showing a -0.5% decline across bricks-and-mortar stores, following a “cash for clunkers”-like jump in early promotions which pulled demand forward with little follow through in the remaining shopping days. However, not even we predicted the shocker just released from the National Retail Federation, the traditionally cheery industry organization, which just reported absolutely abysmal numbers: sales during the four-day Thanksgiving holiday period crashed by a whopping 11% from $57.4 billion to $50.9 billion, confirming what everyone but the Fed knows by now: the US middle class is being obliterated, and that key driver of 70% of US economic growth is in the worst shape it has been since the Lehman collapse, courtesy of 6 years of Fed’s ruinous central planning. 

Demonstrating the sad state of America’s “economic dynamo”, shoppers spent an average only $380.95, down 6.4% from $407.02 a year earlier. In fact, as the NRF charts below demonstrate, there was a decline across virtually every tracked spending category (source):

As the WSJ reports, NRF’s CEO Matt Shay attributed the drop to a combination of factors, including the fact that retailers moved promotions earlier this year in attempt to get people out sooner and avoid what happened last year when people didn’t finish their shopping because of bad weather.

Also did we mention the NRF is perpetually cheery and always desperate to put a metric ton of lipstick on a pig? Well, hold on to your hats folks:

He also attributed the declines to better online offerings and an improving economy where “people don’t feel the same psychological need to rush out and get the great deal that weekend, particularly if they expected to be more deals,” he said.

And of course the sprint vs marathon comparisons, such as this one: “The holiday season and the weekend are a marathon not a sprint,” NRF Chief Executive Officer Matthew Shay said on a conference call. Odd how that metaphor is never used when the (seasonally-adjusted) sprint beats the marathoners.

So there you have it: a 11% collapse in retail spending has just been spun as super bullish for the US economy, whereby US consumers aren’t spending because the economy is simply too strong, and the only reason they don’t spend is because they will spend much more later. Or something.

Apparently the plunge in Americans who even care about bargains is also an indication of an economic resurgence:

The retail trade group said the number of people who went shopping over the four-day weekend declined by 5.2% to 134 million, from 141 million last year.

Finally, what we said earlier about a surge in online sales, well forget it – it was a lie based on the now traditional skewed perspectives from a few self-serving industry organizations:

Despite many retailers offering the same discounts on the Web as they offered in stores, the Internet didn’t attract more shoppers or more spending than last year. Online sales accounted for 42% of sales racked up over the four-day period, the same percentage as last year, though up from 26% in 2006, the trade group said.

In fact, it was worse: “Shoppers spent an average $159.55 online, down 10.2% from $177.67 last year.”

But the propaganda piece de resistance is without doubt the following:

“A highly competitive environment, early promotions and the ability to shop 24/7 online all contributed to the shift witnessed this weekend,” Mr. Shay said.

So to summarize: holiday sales plunged, and Americans refused to shop because the economy is “stronger than ever” and because Americans have the option of shopping whenever, which is why they didn’t shop in the first place. That, and of course plunging gasoline prices leading to… plunging retail sales, just as all the economists “correctly” predicted.