One person’s “cheap” is another person’s “chintzy”

Nov 24th, 2015

A look at how your age and gender influence your spending habits

When somebody says “I got something cheap,” do you think he or she just got a bargain … or a piece of junk?

Your answer to that question may depend on how old you are, and whether you’re a man or woman.

Next question: Are you willing to buy that new, high-end cell phone? And, how important are name-brand clothes to you?

Thanks to a survey of 1,500 Progressive customers, we have these answers—some of which may surprise you.

For example, our findings showed men (at 12%) were more likely to buy high-end clothes than women (at 9%)—which seems to fly in the face of some age-old stereotypes.

What does “cheap” mean to you?

We started the research as a quest to answer a completely different question—one that’s been plaguing us for years.

Working at an insurance company, we were surprised by how many people call, search the Web or ask their agents for “cheap car insurance.” For many, a car is one of the most expensive items they own, so why look for “cheap?”

Are they looking for coverage with the lowest possible price regardless of quality, or just a great price from a reliable company? According to the research, it looks like the latter.

While many people ask about cheap car insurance:

  • Only 6 percent of respondents are willing to go with a lower-end brand, with 94 percent preferring middle-of-the-road or high-end brands.

However, age did play a factor.

  • Among respondents 18-34, 35 percent preferred a high-level brand, compared to 47 percent of people 55 and older.
  • The type of car being insured could have played a factor, as people 55 and older were also significantly more likely to purchase a high-end car.

We also found another interesting thing—age made a difference when it came to how people viewed the term “cheap.”

Either the meaning of the term is changing over time, or younger and older people just define the term differently. We didn’t ask any leading questions, we just asked people to associate different words with the term “cheap.” Across the board, the younger the respondent, the more likely he or she was to have a positive correlation with the word.

Examples include:

  • Among people 18-34, 76 percent associated “cheap” with the term “inexpensive,” compared to 61 percent of people 35-54, and just 55 percent of people 55 and older.
  • Conversely, among people 55 and older, 58 percent associated “cheap” with the term “inferior,” compared to 53 percent of people 35-54 and 41 percent of people 18-34.

Just how important is that expensive cell phone?

While we were at it, we figured, why not have a little fun with the research?

So, we also looked into age and gender breakdowns of spending habits on other items, including cell phones (younger people were more likely to buy a high-end brand), TVs (men were more likely than women to buy a high-end brand) and other forms of insurance.

See the full breakdown below. Some of the information may be what you’d expect, some of it may be pretty surprising.

Do these numbers represent you? What did we miss? What items are you willing to go cheap on, and what items are high end only? Let us know what you think in the comments section.