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Retailers wondering why department store sales are going down may need to start targeting mothers.
Roy Morgan research undertaken for Wesfarmers-owned Kmart found that 86.4 per cent of mothers from households earning under $120,000 say they are under financial pressure and have had to reassess spending due to the rising cost of living. The 1000 mothers surveyed were aged between 20 and 55.
The figure is up from July 2011, when 78.7 per cent of mums reported being under financial pressure.
The latest survey shows 85.5 per cent of mothers have had to sacrifice spending on themselves to keep up with necessities and 57.1 per cent say increases in prices of electricity, fuel and other household costs have affected the family budget.
“What this shows is mums are cutting down on beauty products, clothes for themselves and home décor so they can afford to spend on their children and food,” Kmart managing director Guy Russo says. Over the past eight months, Kmart has dropped the prices of some products by up to 30 per cent to try to recoup anaemic sales.
While an extra 3 million customers visited its stores in the six months to December 31, the extra volumes failed to translate into higher dollar sales because of Kmart’s lower prices.
Kmart’s total sales fell 2.2 per cent to $1.4 billion in the three months to December, reducing growth for the half-year by 1.3 per cent.