© 2010 by M/A/R/C® Research

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Trends InView December 2010

News and observations from December 2010

©2010 by M/A/R/C® Research Page 2 Dec ‘10

No ChangeMore $ Less $

5%

6%

6%

5%

7%

6%

7%

23%

37%

29%

29%

35%

30%

33%

32%

23%

28%

28%

22%

22%

23%

31%

23%

26%

26%

23%

20%

23%

10%

12%

11%

13%

12%

22%

14%

Nov '08

Apr '09

Sep '09

Jan '10

May '10

Sep '10

Jan '11

Doctor visits are falling off as the number of consumers putting off a visit is up from

September of ‘10.

As Often/Less Expensive

Same Types Less Often/Less Expensive

Less Often/Same Types

As the new year started, restaurant visitation was off as consumers were reportedly frequenting less often and less expensive types of restaurants and/or QSRs.

22%Apr '09

Customers are reacting to the new fees banks are charging as those considering changing

banks is rising toward September ‘09 levels.

24%Sep '09

Consider switching based on fees

19%Jan ‘11

Insurance defection has reached the highest level yet – with many

consumers expecting to switch providers in 2011.

21%Jan ‘10

22%Jan ‘11

24%Sep ‘09

19%Jan ‘10

19%May ‘10

41%Jan ‘11

38%Sep ‘09

34%Jan ‘10

33%May ‘1018%May ‘10

19%Sep ‘10

32%Sep ‘1016%Sep ‘10

Consumers Cost Conscious into 2011*

Data weighted to match age/gender census data

* Based on online exit surveys conducted Jul ’08, Nov ’08, Apr ’09, Sep ’09, Jan ’10,

May ’10, Sept ’10 and Jan ’11 among a minimum of 2000 consumers ages 18+

©2010 by M/A/R/C® Research Page 3 Dec ‘10

Advertising & Marketing

Over 60% of adults said they ignore internet ads the most of any type of advertising, with over 40% saying they ignore banner ads the most and 20% saying they ignore search engine ads the most. Television ads are ignored by 14% of adults, followed by radio ads (7%) and newspaper ads (6%). Nine percent of respondents said that they do not ignore any advertising at all. (PR Newswire, 12/3/10)

A recent survey found that approximately 56% of Americans are bothered by the sexual imagery used in advertising these days – 25% saying they are “very bothered” and 32% just “somewhat” bothered. The opinions vary by gender, with 73% of women saying they are bothered by the amount of sexual imagery in ads but only 39% of men feeling the same way. (PR Newswire, 12/10/10)

A survey of Americans age 18+ found that over three-fourths remembered seeing an online ad that appeared to be tailored to them based on other websites they had visited or topics they had searched on. Of this group, over 34% said they did not like this kind of targeted advertising, while over 27% said they liked the ads and 38% had no opinion on the matter. Reasons for not liking the targeted online ads included: the ads were “annoying & distracting” (54.9%); ads feature a product that the person isn’t actually interested in (38.2%); the ads are an invasion of privacy (33.4%); and the ads “follow” the users from one site to the other (27.5%). Less than 20% of respondents said they had a better impression of the advertiser or product after seeing a targeted ad for it and almost 11% said they ended up with a worse impression of the company and/or product. (Business Wire, 12/14/10)

In another survey about targeted online ads, 47% of respondents reported they would only allow targeted ads from advertising networks they had specifically given permission to do so, if they were given a choice in the matter, and 37% said they wouldn’t allow any advertising networks to show them targeted ads. (USA Today, 12/14/10)

Travel/Transportation

A survey of American travelers found that roughly 42% were going to travel for the holidays this year, down from 45% in 2009. Most travelers said they would be driving (51%), while 45% are flying. Almost 20% said they were planning on spending more on holiday travel this year, with 22% saying they will spend over $2,000 on just their holiday travel. (PR Newswire, 12/7/10)

Almost 90% of respondents to a recent travel survey said they would be taking the same number of leisure trips or more in 2011 than they did in 2010. The main reasons people gave for being able to take more leisure trips in 2011 were the belief that their economic situation was going to improve in the next year and an increase in free time will allow them to take more vacations. (PR Newswire, 12/13/10)

©2010 by M/A/R/C® Research Page 4 Dec ‘10

Health

Forty-five percent of U.S. adults have been tested for HIV at least one time, an increase from40% in 2006. The Centers for Disease Control and Prevention estimates that over 1 million U.S. adults are HIV positive but are not aware they have the disease because they’ve never been tested. (Seattle Times, 12/1/10)

A study published in the Journal of the American Medical Association found that over one-fourth of children’s over-the-counter medicines had no dispensers included in the packaging, which requires parents to dose the medicine using spoons. For those products that did include a cup or dropper, the label instructions on 99% of the products did not match the markings on the dispenser, such as labels saying to give your child two teaspoons of the syrup but the cup provided with the medicine is only marked with tablespoon amounts. According to the CDC, almost 5,700 children are taken to emergency rooms every year because of inadvertent overdoses of OTC medicine by parents. (USA Today, 12/1/10)

A report by the Employee Benefit Research Institute found that 5% of the population with private insurance has a consumer-driven health plan, up from 4% in 2009, and 14% have a high-deductible health plan, up from 13% in 2009. (PR Newswire, 12/2/10)

According to data from the American Academy of Pediatrics, hospitalizations due to eating disorders among children age 12 and under increased 119% from 1999 to 2006. (PR Newswire, 12/9/10)

A survey by the American Academy of Family Physicians reported that nearly 13% of its members would have to consider not seeing any Medicare patients after the 25% Medicare pay cut goes into effect on January 1. In addition, over 60% said they might have to stop accepting new patients who are on Medicare. (PR Newswire, 12/2/10)

Among Medicare beneficiaries age 65+, 22% said they plan to review their Medicare coverage options during the 2011 Annual Enrollment Period, which runs from November 15-December 31, 2010. This is up from less than 10% in 2009. (Marketwire, 12/20/10)

©2010 by M/A/R/C® Research Page 5 Dec ‘10

Food & Beverages/Restaurants

A food industry expert predicts mobile food apps will be a big trend in 2011, with apps to help shoppers find items and coupons in grocery stores, and others that will let diners pre-order meals at restaurants. Other trends for 2011 include: easier-to-read ingredient label language; products that emphasize their Vitamin D benefits; a shift in buying “local” foods made within 100 miles to wider “regional” foods; a rally towards seafood from the New Orleans/Gulf area as the region recovers from the oil spill of 2010; and more in-store product samples. (PR Newswire, 12/8/10)

The top food and beverage trends that shaped 2010 were:

“Gourmet on the go” – street food/food trucks that featured high-quality cuisine.

“Fine fast” – sandwich shops that make high-quality sandwiches with artisan and locally-sourced ingredients plus condiments made in-house.

Boutique booze – seen in bars that specialize in serving just one liquor or festivals for independent spirit producers.

Macaroon cookies – a Parisian pastry made of almond-meal and meringue cookies sandwiched with buttercream, chocolate ganache or jam.

Bahn Mi and Bao – Vietnamese sandwiches made popular by food trucks (see #1 above).

Hand-cut meats.

Agave nectar.

Eggs served at meals all day long, not just breakfast.

Upscale burgers made with Angus or even Kobe-style American Wagyu beef. (PerishableNews.com, 12/22/10)

A recent study found that 60% of Americans said they were worried about how the beverages they drink impact their health and almost three-quarters believe beverage manufacturers are not concerned about consumers’ health. (PR Newswire, 12/13/10)

According to members of the American Culinary Federation, the top menu trends for 2011 will be:

Healthy dishes for kids and children’s nutrition in general as a culinary theme.

Locally sourced meat, seafood, produce, wine and beer.

Sustainability of seafood and other products. “Hyper-local” food items.

Gluten-free or allergy-conscious items. A “back-to-basics” attitude toward cuisine.

Farm-branded ingredients. Artisan liquors and cheeses.

Smaller portions at a smaller price. “Culinary” cocktails.

Ethnically inspired items for breakfast. (PR Newswire, 12/1/10)

©2010 by M/A/R/C® Research Page 6 Dec ‘10

Population/Culture

About 40% of Americans admit that they’ve taken the day off when their employer declared a snow day, even when they could have gotten to work anyway. Most people prefer to stay inside on “snow days” with favorite activities of reading a book (56%), watching an old movie (45%) and cooking/baking (44%). (PR Newswire, 12/6/10)

The self-imposed segregation of black and white women’s hair salons is slowly coming to an end. Black women have traditionally preferred their own salons where the stylists are experienced in the difficulties associated with styling their hair. The recession saw more women making hair styling appointments less frequently to save money, plus more black women are opting for hair weaves, braids, natural hair styles and wigs, which don’t require the weekly hair appointments for straightening and other processes. These factors are leading many traditionally black hair salons to close and their stylists and customers are moving to non-specialist salons. (Washington Post, 12/5/10)

A survey commissioned by USA Network found that 61% of Americans think that the amount of division in the country has gotten worse in the past ten years, up from 55% in the same survey from 2009, and 41% feel that the amount of intolerance, discrimination and prejudice has increased, up from just 32% in 2009. (PR Newswire, 12/8/10)

In 2010, 49 million Americans lived in a multi-generational household: one that had at least two adult generations living in it or a grandparent and one additional generation. That number is up 33% from 1980. Reasons for the multi-generational household trend include:

An increase in young adults moving back in with their parents after college.

Young adults living with their parents or siblings because they can’t find a job or were laid off.

More people are getting married later, men at age 28 and women at age 26, up from 23 and 21, respectively, in 1970.

More Baby Boomers are acting as caregivers to their parents.

An increase in immigration in the 1980s and 1990s of Hispanics and Asians, both of which have cultures in which multiple generations living in one household is normal.

(Cincinnati Enquirer, 12/13/10)

A new study about marriage and divorce in the United States found that 11% of married college-educated Americans get divorced or separate from their spouses in the first ten years of marriage, compared to 37% of people with just a high-school education. Similarly, just 6% of college-educated mothers have a child out of wedlock, while 44% of mothers with a high-school education do and 54% of high-school dropout mothers do. These numbers have risen from 2%, 13% and 33%, respectively, compared to data from the 1980s. (Star Tribune, 12/12/10)

©2010 by M/A/R/C® Research Page 7 Dec ‘10

According to new data from the US Census Bureau, in 2009 there were nine counties in the United States that had more foreign-born residents than natural born US citizens: Los Angeles, Santa Clara and San Francisco counties in California; the Aleutian East Borough and Aleutians West Census Area in Alaska; Kings and Queens counties in New York; Miami-Dade in Florida; and Hudson County, New Jersey. (PR

Newswire, 12/14/10)

Data from the FBI shows that crime rates are falling nationwide. In the first six months of 2010, reports of murder dropped 7.1%, rape reports were down 6.2%, robbery down 10.7%, aggravated assault down 3.9%, theft down 2.3%, car theft down 9.7% and arson down 14.6%. (Christian Science Monitor, 12/20/10)

Entertainment/Media

The National Retail Federation reported that almost 50% of shoppers planned to buy books, either printed or electronic, as gifts this holiday season. (PR Newswire, 12/1/10)

Among Americans who listen to streaming audio online, 48% do not listen to “over the air” broadcasts from AM or FM radio stations. (Business Wire, 12/9/10)

There is a glut of television sets in stores this season. Due to manufacturers keeping prices stable during the first nine months of the year, sales plummeted, which caused inventory to pile up during the Christmas season. Manufacturers were also surprised that 3D televisions, Internet-connected TVs and other fancy televisions didn’t sell as well as they had predicted. Industry experts feel that many households bought new flat-panel televisions in the past few years, with 60-70% of households now owning at least one, so they don’t see the need to go buy another one. (San Diego Union-Tribune, 12/20/10)

A recent report found that less than 1% of American households currently own a 3D television and only 8% of those that do not have one are “very interested” in getting one. In a similar report, 59% of consumers said they “definitely will not” buy one in the next 12 months. (Connected Planet, 12/28/10)

In 2010, 33% of adults who use the Internet said they had watched streaming video, up from 18% in 2007. (New York Times, 12/20/10)

A survey of American Internet users found 33% have bought digital music online, 18% paid for subscriptions to digital newspapers or magazine or bought individual journal articles or reports online, 16% have paid for videos, movies or TV show episodes online, and 10% have paid for e-books online. (Dallas Morning News, 12/30/10)

©2010 by M/A/R/C® Research Page 8 Dec ‘10

Homes & Housing

The Standard & Poor’s Case-Schiller price index for homes saw a 0.7% drop from August to September with 18 of the 20 cities in the index seeing their housing prices decline. The index is still 5.9% higher than it was in April 2009, its lowest point, but it is almost 30% below the record peak set in July 2006. (New York

Times, 12/1/10)

According to a recent survey, almost 60% of American adults think that the housing market won’t recover until 2013 or later. Only 10% of adults think it will recover in 2011 and just 4% think it has already recovered. (Marketwire, 12/7/10)

Data from a survey by Fannie Mae shows that 33% of Americans said they would be more likely to rent their next home rather than buy it, up from 30% in the same survey taken in January 2010. Just among people who rent, 59% said they would continue to rent the next time they moved, up from 54% in January. (PR Newswire, 12/9/10)

Even though many Americans are active social media users, only about one-fourth of apartment renters use it to help them find a new apartment and over 90% said they are not connected to their apartment community through any social media website. (PR Newswire, 12/7/10)

The top eight home design or remodeling trends for 2011 will be:

1. Compact fluorescent or LED lighting.

2. High-quality synthetic materials like Hardie Plank siding that mimics the look of real wood but is more durable.

3. Bathroom tiles in larger 12x12 or 12x18 sizes that show fewer grout lines.

4. Complimentary finishes or stains on kitchen cabinets or a mix of painted and stained cabinets where the upper cabinets are different colors than the lower cabinets or an island is painted and the cabinets are wood stained.

5. Screened-in porches that enable more outdoor living.

6. Furniture-like details on kitchen cabinets.

7. Heated bathroom floors.

8. Kitchen cabinet inserts like special knife holders or dividers for spice jars. (Business Wire, 12/16/10)

©2010 by M/A/R/C® Research Page 9 Dec ‘10

Fashion/Clothing

The top fashion trends for 2010 as spotted in sales via eBay were: military-style jackets, plaid, retro fashions from the 1950s, 1980s and 1930s, and items made or trimmed with faux fur and feathers. (TheStreet.com, 12/28/10)

A survey of American women found that on average a woman owns 21 pair of panties, while 10% of women own 35 pair or more. Just over 20% of women vary what kind or color of underwear they wear depending on their mood and 12% consider their underwear to be an important part of their entire outfit. (PR Newswire, 12/13/10)

Retail

On Thanksgiving Day, Americans spent $407 million shopping online, up 28% from 2009. (Pittsburgh Post-Gazette, 12/10/10)

Even with the growth in online shopping, 52% of all retail spending still happens at shopping centers. Malls that have been doing the best business lately have been the newer “lifestyle” centers that are designed to be like town squares, so older traditional shopping malls are being renovated or remodeled to include non-traditional mall retailers like grocery stores or warehouse club stores. (Chicago Tribune, 12/28/10)

U.S. retail sales are forecast to rise 3.5% this year compared to 2009, but in the luxury goods segment the increase is supposed to be even greater at 7%. In the last quarter of 2010, luxury retailers like Nordstrom, Neiman Marcus and Saks all reported increases in traffic and sales. (Los Angeles Times, 12/15/10)

©2010 by M/A/R/C® Research Page 10 Dec ‘10

Technology/Communications

When asked about their cell phones, almost 90% of Americans age 18-34 said that if they lost their cell phone they wouldn’t know how to call loved ones because they don’t have their phone numbers memorized, only saved in the phone. Almost half said they often take their cell phone with them to the bathroom and 30% said they feel “anxious” if their cell phone isn’t nearby. (Business Wire, 12/7/10)

A new study found that just 8% of Internet users are regularly active on Twitter, while 2% are “extremely” active and use the service daily. (New York Times, 12/13/10)

An online survey of American adults found that 90% want more control over the amount of their personal information available online. Forty-three percent of women said they were more aware of the kind of personal information that is available online this year than last year, compared to 38% of men, and overall 63% of people think they need to check online every six months to see what kind of information is out there about them. (PR Newswire, 12/14/10)

Americans spend 121% more time online than they did five years ago, according to new survey data. (New

York Times, 12/20/10)

A new U.S. government report on phone use found that in the first six months of 2010, 27% of U.S. households have no landline phones, only cell phones, up from 14% in same period during 2007. When broken out by age, 40% percent of 18-24 year olds and 30-34 year olds live in cell-only households, but 51% of people age 25-29 live in a cell-only household. (Houston Chronicle, 12/22/10)

When asked about planned computer purchases in the next six months, American consumers were reported to be twice as likely to buy laptops, notebooks or tablet computers as they were desktops. (Business Wire, 12/28/10)

Automotive

A survey of American drivers found that 40% have swerved into another lane, slammed on the brakes, gotten a ticket, almost had an accident or have had an accident because they were driving while distracted. The number rises to almost 50% among college-educated drivers and 43% among drivers who make more than $75,000 a year. (PR Newswire, 12/2/10)

Among online car shoppers, 45% are going to delay their next vehicle purchase due to financial or economic concerns. When asked how long they were going to wait to buy a new vehicle, 25% said four to six months and 44% said at least seven months. (PR Newswire, 12/21/10)

©2010 by M/A/R/C® Research Page 11 Dec ‘10

Economy/Finance

The Consumer Confidence Index from The Conference Board climbed to 54.1 in November, up from 49.9 the month before. This was the highest index since June, when it reached 54.3. The index for a “healthy” economy, however, is 90 and that point was last reached in December 2007. (New York Times, 12/1/10)

Data from the Bureau of Labor Statistics shows that in November 5.1% of Americans with a bachelor’s degree or higher are unemployed, the highest level since records began being kept in 1970. The November rate was up from 4.7% in October and 4.4% in September, but it is still much lower than the unemployment rate for high school graduates (10%) and people with less than a high school education (15.7%). (USA Today, 12/6/10)

A survey commissioned by the EARN Research Institute reported that 46% of American households said they had enough money in savings to pay basic expenses for at least three months, down from the exact same survey just six months ago in June. When asked where they might get money to meet their basic household needs in case of job loss or illness, 43% said they would have to take money out of their retirement plans. Among respondents age 18-34, 35% said they would just pay for everything with their credit cards in case of a financial emergency. (Business Wire, 12/7/10)

In a survey of Americans with over $100,000 in investable assets, 13% said they had closed at least one of their investment accounts in the past 12 months, a figure that is double the rate reported for the past five years. The main reasons given were: consolidation of accounts (18%); rollovers (14%); fees were too high (12%); or they needed to access the money in that account (12%). Overall, the net number of investment accounts in these households dropped from 3.54 in 2009 to 3.29 in 2010. (Business Wire, 12/9/10)

In 2010, over three-quarters of Americans have a PayPal account, up from 55% in 2008. There has also been an increase in the number of purchases made by PayPal users, up from an average of 10.8 per year in 2008 to 14.0 per year in 2010. In an early estimate of holiday sales, PayPal reported it had seen a 27% increase in the number of PayPal payments made on Black Friday compared to 2009. (Business Wire, 12/27/10)

©2010 by M/A/R/C® Research Page 12 Dec ‘10

Christmas/Holiday Season

A survey of American workers found that over 70% of employees whose jobs require them to use e-mail and voicemail regularly would not “disconnect” from the office during the holiday season, even on the actual holidays of Thanksgiving and Christmas Day. (PR Newswire, 12/1/10)

A survey of Americans’ feelings toward outside Christmas decorations on houses found that 58% said they would like to have a decorated house in their neighborhood, up from 45% in the same survey for 2009. When asked if a decorated house improves the neighborhood, 57% of respondents said yes, up from 40% in 2009. Plus, 54% of respondents said they would like to have the decorated house as their neighbor, up from 39% in 2009. (PR Newswire, 12/1/10)

One-third of American workers said their employers never hold holiday parties. (PR Newswire, 12/1/10)

According to a survey by an online vacation rental site, over half of Americans feel their relatives stay too long at the holidays, with 22% saying their relatives should leave after just one day and 29% saying it takes a few days before they feel their relatives should go back home. Reasons for the dismay at having relatives stay over during the holidays include: leaving their stuff all over the house (31%), not volunteering to help cook or clean (26%), wanting their hosts to entertain them constantly (21%), and taking over the remote control for the television (2%). (PR Newswire, 12/2/10)

According to the National Christmas Tree Association, Americans are expected to buy 32-38 million real trees this year, up from 28 million in 2009. Some sellers are reporting that consumers are “downsizing” their trees and buying shorter ones than in the past. Another survey found that shoppers plan on spending $63 on holiday decorations this year, which is even with 2009 and up from 2008 levels. (Sun-

Sentinel, 12/4/10)

A survey of holiday spending found that 38% of Americans said they would spend less this year than last year, down from 43% who said that in 2009. Only 31% said they would shop for less expensive brands this year, down sharply from the 57% in 2009, and just 6% said they would “re-gift” this year compared to 17% last year. (Business Wire, 12/6/10)

During the holiday season, 71% of American adults plan to bake cookies, with an average of 8 dozen cookies per baker. (PR Newswire, 12/17/10)

Two new surveys found that while many Americans celebrate Christmas, not all see the religious side to it. The joint surveys found 74% of adults said Christmas is “primarily” a religious holiday but when asked what they will do to celebrate it, they said “give gifts” (89%), “dine with family or friends” (86%), “put up a Christmas tree” (80%) or “play holiday music” (79%). Those who said they would do religious activities were lower: “attend church Christmas Eve or Christmas Day” (47%), “watch Biblical Christmas movies” (34%) and “read or tell the Christmas story from the Bible” (28%). (USA Today, 12/20/10)

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