Make Me Smart The "little treat" economy
Sep 16, 2025
Kristin Schwab, a Senior Reporter at Marketplace specializing in retail, dives into her intriguing theory on the 'little treat' economy. She discusses how Americans, especially Gen Z, are indulging in affordable luxuries like fancy candles and gourmet foods as an escape from economic uncertainties. The conversation also highlights how brands, like Gap, are reviving Y2K fashion trends to resonate with this younger audience, blending nostalgia with modern marketing strategies. It's a fascinating intersection of consumer behavior and advertising in today's marketplace.
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Consumers Still Spending Amid Headwinds
- Retail sales rose 0.6% in August and marked a third consecutive monthly increase.
- Consumers appear confident despite tariffs, a weaker labor market, and recent inflation upticks.
Inflation Masks Real Purchase Growth
- Census retail figures don't strip out inflation, so rising sales mix quantity and price effects.
- Analysts must parse price changes to determine whether consumers bought more or simply paid more.
Winners And Losers In Retail Categories
- E-commerce, clothing, and food & drink saw notable gains in August, while furniture weakened.
- Furniture may be hit by tariffs and the stagnant housing market, reducing moving-related purchases.