By Martinne Geller
NEW YORK (Reuters) - Economic uncertainty is forcing U.S. shoppers to consider low prices and bargains above all else for the first time in a decade, according to results of a survey released on Tuesday by AlixPartners.
That means retailers with the lowest prices will perform relatively better than more upscale rivals over the next few quarters, said Frederick Crawford, a managing director with AlixPartners, a turnaround consulting firm.
Crawford's findings could give an indication of the strength of monthly same-store sales, which retailers ranging from Wal-Mart Stores Inc
Crawford, who has been surveying consumers for about 10 years, said he has never seen pricing and value as important to shoppers as it was in this year's survey, which was administered last fall.
"We know that people are going to be focused on absolute price and value. We anticipate that means people will be trading down to those formats that are positioned well in that regard," Crawford said in an interview.
For example, Wal-Mart will outperform Target Corp
But Crawford was quick to note that all retailers will be hurt this year as U.S. consumers rein in discretionary spending due to higher costs for food and fuel, declining home values, job uncertainty and the credit crunch.
According to tracking firm Retail Metrics, which is expecting overall retail earnings to have fallen 9.5 percent in the fourth quarter, the most recent quarter is shaping up to be the slowest in seven years.
But many consumers, who once "traded up" to more expensive brands when times were good, are now "trading down" to less expensive brands and stores, Crawford said.
"They're the swing vote in this thing and now they're going to swing down," Crawford said, noting that they're even willing to put up with bad service.
"For a decade we had been seeing people saying, 'As long as it's a decent price I'll pay a little bit extra in order to get better service and a better store experience," Crawford said.
"This is the first time in 10 years that the real message is: 'I'm looking to stretch my dollars and I'll put up with bad service or a bad experience'," he said.
(Editing by Braden Reddall)
