NEW YORK — Collegians appear to be rolling in cash.
A record rate of employment among college students, plus perennial desires to indulge and experiment, are pushing spending by 18- to 30-year-old collegians, for things not essential to their schooling, to its highest-ever level: $41.1 billion in the school year ended this spring.
Those purchases by the country’s 16.5 million college students marked a 24 percent surge over outlays of $32.25 billion in the academic year ended spring 2004, according to the third annual Alloy College Explorer Study. The spending is for a range of discretionary items, including entertainment, apparel, and personal care products, as well as food.
The reason for the big leap, said Samantha Skey, senior vice president at Alloy Media and Marketing, is that more than three quarters, or 78 percent, of the college crowd is employed, increasing their disposable income and desire to spend.
“Millennials like to chart lots of achievement by young adulthood,” Skey said, when asked what’s raising student employment to a new high.
Also sparking the spending, said David Morrison, author of “Marketing To The Campus Crowd” (Dearborn Trade Publishing), is a desire for self-expression, self-indulgence and experimentation. “Students’ newfound freedom and discretionary [income] are creating an insatiable appetite,” said Morrison, who is president of marketing consultant Twentysomething.
Spending among the 18- to 30-year-old college set is projected to climb 4 percent over its 2005 level, to reach $42.6 billion for the school term ending spring 2006, and to hit $45.1 billion for the term ending spring 2010, up 10 percent from 2005.
Pegged at about $5 billion in the Alloy study, spending on apparel and footwear accounted for around 10 percent of college students’ purchases of discretionary items, plus food, in the 2004-2005 academic year; personal care was, 8 percent, or $3.1 billion, and fragrance and beauty products, 3 percent, or $1.1 billion.
That made apparel and footwear the fourth-biggest category capturing collegians’ dollars, just a bit behind purchases of $5.2 billion on cell- and land-line phones. Placing second and snagging expenditures of $5.6 billion was entertainment, such as music, movies and video games. Food captured the most money, with student spending totaling $15.9 billion.
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These findings, disclosed in August, are based on a representative sample of 1,638 college students, ages 18 to 30, polled online this spring for Alloy by Harris Interactive.
By another measure, that of the National Association of College Stores, college students spend an estimated $4.9 billion annually on apparel without school names and logos, alone.
Female students are spending 75 percent more on apparel and shoes per month than males, or $42, on average, versus $24, Alloy’s College Explorer Study found. And that’s despite a difference in monthly discretionary purchasing of just 4 percent, or an average of $280 spent by females, compared with $269 spent by males.
When characterized by three racial or ethnic groups, African-Americans spent the most on those fashion items, averaging $46 a month per person — 35 percent more than the $34 average spending in the category among college students overall. Next came Hispanics, with average monthly expenditures of $39, followed by white students, who shelled out $31. (Students were asked to identify themselves by selecting one of those three racial and ethnic descriptions.)
African-Americans led in purchases of those goods despite dishing out 18 percent less per month, on average, for food and discretionary items than white students, or $238 versus $281, and 12 percent less than the Hispanics, who spent an average of $267.
Curiously, students without jobs spend virtually the same amount on apparel and footwear as those who are employed: $33 a month, on average, just a dollar shy of the $34 spent by those with jobs.
The upswing in overall spending is occurring despite collegians’ resistance to traditional advertising; their self-described distaste for the celebrity marketing that characterizes much of today’s commercial climate, and their preference for pitches by everyday people, such as current campaigns by Dove and Nike. Only 5 percent of those polled by Alloy said they prefer brands their favorite celebrities are using, making that consideration the least significant of a dozen influences on their purchasing. A sale price was most persuasive, prompting a favorable response from 80 percent. Environmentally safe brands rated a distant second, preferred by 31 percent.
“College students say they’re not influenced by celebrities … but the question is, will they actually buy products [advertised by] real people?” Skey said of such campaigns as the one for Dove firming lotions and creams. “Or will they buy the latest [makeup] advertised by Cameron Diaz?”
Either way, author-consultant Morrison noted, college students tend not to acknowledge an interest in ads. Instead, he said, “It’s more savvy to be aware of how you might be manipulated by marketing.”
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