Confidence among U.S. homebuilders rose this month to its highest level in six years, and many expect the housing recovery will strengthen in the next six months.
The National Association of Home Builders/Wells Fargo builder sentiment index released Tuesday increased to 40 in September. That's up from 37 in August and the highest reading since June 2006, just before the housing bubble burst.
Any reading below 50 indicates negative sentiment about the housing market. The index hasn't reached that level since April 2006, the peak of the housing boom.
Still, a measure of builders' outlook for sales in the next six months rose to 51. That's up from 43 in August and also the highest level since June 2006.
Builders also reported seeing the best sales level since July 2006. And turnout by prospective buyers returned to levels not seen since May 2006.
The positive trends have helped bolster optimism that the U.S. housing recovery will endure.
"We think things have turned around and this recovery is sustainable," said Patrick Newport, an economist with IHS Global Insight. The rise in builder confidence means that new-home construction is likely to increase over the next six months, Newport said.
The survey, which is based on responses from 445 builders, has been trending higher since October. After a dismal 2011, homebuilders have seen their fortunes begin to turn around this year as the housing recovery has steadily gained momentum.
Sales of both new and previously occupied homes are running ahead of last year. Home prices are increasing more consistently, in part because the supply of homes has shrunk and foreclosures have eased. And mortgage rates remain near record lows, beckoning potential buyers with good credit.
Still, the housing market remains depressed. While the turnaround will continue next year, a complete recovery in home construction isn't expected before 2016, Newport said.
The housing market isn't expected to recover fully until job growth improves and the unemployment rate, now at 8.1 percent, declines further.
Still, sales remain on the upswing at Taylor Morrison, which builds homes in five U.S. states and caters to entry-level and move-up buyers, as well as seniors.
The Scottsdale, Ariz.-based company's sales are up 40 percent from last year, said Graham Hughes, the builder's vice president of sales and marketing.
Hughes says the lower inventory of previously occupied homes for sale has helped drive stronger demand for new homes. Demand has been especially strong in markets like Phoenix, where the builder's sales are up 80 percent. That's made it possible for Taylor Morrison to hike prices there by an average of 15 percent.
Taylor Morrison expects to close out 2012 with 15 percent more employees than last year. It also anticipates boosting payrolls by another 10 percent next year.
"I'm definitely optimistic now," Hughes said. "We've turned the corner and we're at the bottom and starting to look up."
Though new homes represent less than 20 percent of the housing sales market, they have an outsize impact on the economy. Each home built creates an average of three jobs for a year and generates about $90,000 in tax revenue, according to the NAHB's data.
(Source: The Associated Press, 09/19/12)
After an abysmal year at theaters, moviegoing is back. Through the first two months of 2012, ticket sales surged 18% over the same period last year. More importantly, attendance was up 20%, even though this year's films appear to be no stronger than last year's.
If anything, 2012 is flourishing despite the movies. Last year's early-season No. 1's included The Green Hornet, Just Go With It and Gnomeo & Juliet -- films that earned middling reviews, at best.
But compared with this year's hits, those films were Oscar bait.
Take The Devil Inside (please, said some tweeters). The $1 million horror flick opened to a staggeringly high $34 million on Jan. 6, giving the year a kick-start that hasn't slowed. Every weekend has seen increased sales over the previous, according to Hollywood.com. This, despite tough reviews for surprise No. 1 films Contraband, The Vow and Act of Valor.
"I can't recall a year that started like this, when almost every movie has overperformed," says Jeff Bock, box-office analyst for Exhibitor Relations. "The movies may not be great, but in terms of making money, the studios are firing on all cylinders."
Bock credits cannier marketing behind this year's movies, which have been aimed at niche audiences. The Devil Inside, for instance, launched a viral campaign that played on its "found footage" theme. Valor, which scored an upset win with a $25 million debut weekend, features real Navy SEALs, and publicity events were staged at military sites nationwide.
"You're seeing the studios learn social networking," Bock says. "They've caught up with the trend, and give them credit: They've got their fingers on the pulse of what core groups want to see, and are reaching them" through specific ad campaigns.
Hollywood.com's Paul Dergarabedian says the box-office defibrillation began the last week of 2011, which can be anemic at theaters because of the holidays. Despite being in its third iteration and second week of release, Mission: Impossible -- Ghost Protocol powered through the end of the year on its way to $208 million, the seventh-highest-grossing movie of 2011.
"That's when we knew something was up," Dergarabedian says. "That gave us momentum that we haven't lost."
Nor does it seem likely to slow, as studios begin a march of big-budget releases including Dr. Seuss' The Lorax (which brought in more than $70 million in its debut last weeked), Disney action epic John Carter this Friday and the best-seller adaptation The Hunger Games on March 23.
Dergarabedian says that while it's too early to anoint the year a success, the rebound marks "a shift like I've never seen before. Remember, last year was the lowest-attended in 15 years," with 1.28 billion tickets sold in North America.
"If studios can keep up the way they're marketing their products," Bock says, "Hollywood is going to be just fine."
(Source: USA Today, 03/01/12)
One-third of customers of big and large regional banks cite fees as the main shopping trigger. However, poor service and unmet customer expectations also have fueled increases in defection rates among customers of large, regional and midsize banks.
The beneficiaries of the exodus from larger banks are primarily smaller banks and credit unions. Acquisition of new customers by smaller banks and credit unions has increased by 2.2 percentage points to an average of 10.3% in 2012 from 8.1% in 2011.
Among big banks, regional banks and midsize banks, switching rates average between 10% and 11.3%, while the defection rate for small banks and credit unions averages only 0.9%, a significant drop from 8.8% in 2011.
The study, which examines the bank shopping and selection process, finds that 9.6% of customers in 2012 indicate they switched their primary banking institution during the past year to a new provider. This is up from 8.7% in 2011 and 7.7% in 2010.
"When banks announce the implementation of new fees, public reaction can be quite volatile and result in customers voting with their feet," said Michael Beird, director of the banking services practice at J.D. Power and Associates, in a release.
However, customers weigh the price they pay against the value of their experience.
"It is apparent that new or increased fees are the proverbial straws that break the camel's back," Beird said. "Service experiences that fall below customer expectations are a powerful influencer that primes customers for switching once a subsequent event gives them a final reason to defect. Regardless of bank size, more than one-half of all customers who said fees were the main reason to shop for another bank also indicated that their prior bank provided poor service."
Promotions and cash incentives helped attract customers shopping for a new bank.
At one of the highest-performing big banks, 19% of customers indicate these promotions were the reason they selected their new bank. However, according to Beird, doing a good job for customers is not just about dollars, but also about loyalty and retention.
Only 32% of customers who selected a new bank because of promotional offerings said they definitely would not switch banks again in the next 12 months. In comparison, 46% to 51% of customers who chose the new bank because of either good service experience or positive recommendations say they definitely will not leave within the next year.
The 2012 U.S. Bank Customer Switching and Acquisition Study is based on multiple evaluations from 5,062 customers who shopped for a new banking account or new primary financial institution during the past 12 months.
The study was fielded in November and December 2011, and includes Bank of America, Bank of the West, BBVA Compass, BB&T, Capital One, Chase, Citibank, Comerica Bank. Fifth Third Bank, Harris National Bank, HSBC, Huntington National Bank, KeyBank, M&I Bank, M&T Bank, PNC Bank, RBS Citizens, Regions Bank, Sovereign Bank, SunTrust Bank, TD Bank, U.S. Bank, Union Bank and Wells Fargo.
(Source: Marketing Daily, 02/27/12)
One-third of consumers (33.1%) say the strategy doesn't make them likelier to shop in a particular supermarket; just 13.3% say it does, according to findings of the 2012 National Grocers Association-SupermarketGuru Consumer Panel Survey Report. Notably, consumers who say "no" the most are the nation's heaviest grocery spenders (36.8% of this group that spends $101 and more per week).
For the majority of consumers overall (53.6%), it depends -– on the store's prices, or on the causes it supports, or on a combination of both. People understand that charitable causes help others in need, but tough times are pretty much everywhere these days, and many already give in other ways beyond what a food store or food brand might do. So there's a limit to the charity they'll connect to their food shopping.
This resistance emerges if people don't feel as strongly about a particular cause, or if they think a store or brand inflates prices in order to deliver the support it messages about. For example, 10.9% say it depends on the causes. Another 15.8% say it depends on the prices. And 26.9% say it depends on both causes and prices.
What if prices rose to allow for donations? That would be fine for 56.7% of U.S. adults surveyed, as long as the price difference was no more than 2%. However, it would be OK with only 10.1% of consumers if the price difference swelled to as much as 5%. For a full one-third of respondents (33.2%), the amount of price difference wouldn't matter.
Related, if charitable support was keyed to a retailer's private label sales, and those prices rose, 62.3% of consumers say they'd still buy their usual amount of store brand items. About one-quarter of consumers (25.3%) say they would buy less, and 12.4% say they would actually buy more.
Will a "causes" strategy help a supermarket pull consumers from wider geographic areas? Not for most consumers, the survey findings show. A majority (53.9%) says it won't travel any farther to shop in a food store that supports causes. However, 24.2% say they would travel up to a mile or two longer, 16.1% say they would travel up to five miles more, and 5.7% say they would travel up to 10 miles farther to support a supermarket that supports causes.
Which causes are uppermost in consumers' minds today? Their Top Five (respondents could name multiple responses) are: relieving hunger (54.8%), relieving child hunger (39.9%), education (30.8%), supporting people in disaster-stricken areas (28.5%), and the environment (23.2%).
(Source: The Lempert Report, 02/14/12)
And they are also willing to reward companies they perceive as responsible, reports the 2011 Cone/Echo Global CR Opportunity Study, with 94% saying they would buy a product that has an environmental benefit and 76% saying they have already done so in the past 12 months. Cause-related products are just as popular, appealing to 93% of the more than 10,000 consumers polled in 10 countries. And 65% have already purchased such a product.
The most important issue for companies to address? Economic development, with 34% of respondents placing it first. Combined with the environment (21%), these issues represent the attention of more than half of the 10,000 respondents. Human rights comes in a more distant third (12%).
The survey -- which included the U.S., U.K., Canada, Brazil, Germany, France, Russia, China, India and Japan -- found that while people are willing to accept a company's word on important issues (with 59% saying companies have educated them on key issues), more are willing to do their own digging. Some 36% say they have done their homework, researching a company's business practices or support of issues; 32% have given feedback directly to the company.
And while consumers say they want a dialog with companies about how they are handling these issues, they still find one-way communication most convenient, with 22% saying they want that information on a package, 21% through the media, and 16% through advertising. A smaller group wants to interact online, with 11% mentioning Web sites, 7% social media, and 3% mobile devices.
The most important element, the Boston-based Cone reports, is simply telling the truth: 88% say it's fine with them if a company isn't perfect, as long as it is honest about its efforts.
(Source: Marketing Daily, 10/04/11)
