Total fashion spending by teens has declined by 24% according to Piper Jaffray & Co’s biannual proprietary research survey.

The ‘Taking Stock With Teens’ survey is a national study on teen spending habits and retail brand perceptions in the US.

The study incorporated mall research field trips in 10 cities across the United States and surveying approximately 980 students, with the Piper Jaffray retail research team publishing key findings for teens' purchasing behaviours and preferences in the categories of fashion, apparel brands and retailers, beauty and personal care, home furnishings, video games, digital entertainment and restaurants.

Piper Jaffray also partnered with the national DECA organisation for the sixth time resulting in 3,000 additional completed online surveys.

Overall, the results of the survey show that total fashion spending declined 24% from the spring 2007 survey due to a gradual maturing of the fashion cycle. Total spending declines were most pronounced for young women where spending was down 18% versus a decline of 9% for young men. The survey also found that teens continue to spend a significant amount of money in the fashion category.

“The fashion category still represents 42% of the total teen budget for the fall 2007 season despite moderation in spending habits,” said Jeff Klinefelter, senior retail research analyst at Piper Jaffray.

“However, we found that spending expectations remain largely unchanged, as nearly 50% of the students plan to spend the same amount of money on apparel this season. We believe the discrepancy between budget dollars and expectations may be due to a decline in contributions from parents.”

Other key findings from the survey include the following:

* Teens were surveyed on their favourite places to shop and their spending habits. Hollister took the lead for the sixth consecutive time, followed by West Coast Brands, American Eagle, Abercrombie & Fitch and Forever 21. Aeropostale moved into the top 10 retail brands for the first time, due to strong support from young women.

* Overall spending in the beauty category is down for teens and up for their parents; however, both demographic groups are trending toward shopping at discount stores versus traditional department stores. Students were also asked to rank their favourite home furnishing retailer or cataloguer in the survey. Privately-held, Swedish-based IKEA was again the top choice, followed by Pottery Barn/PB Teen.

* 83% of teens indicated they own at least one video game console and 51 percent own at least two video game consoles. 62% plan to own a next generation video game system, which shows an increase of eight percentage points from the spring 2007 survey. Additionally, "pre-owned" or used video games represent 41% of video game purchases, which is consistent with spring 2007.

* When asked about buying habits of MP3 players and online music, 82% of the students who own an MP3 player indicated that they also own some form of an iPod, which is up from 79% in fall 2006. Purchasing online music is becoming more mainstream as 64% of the students surveyed indicated they download music illegally, compared to 72% at this time last year. iTunes continues to dominate market share at 79%. In addition, after only three months of availability, 3% of the students own an Apple iPhone, and 9% expect to buy an iPhone in the next six months.

* Students completed survey questions on restaurants and spending on food this fall for the second time. Starbucks continued to be the clear brand leader across the board in both the school and online survey. Chipotle and McDonald's came in second and third in the school survey, while Olive Garden and Applebee's were second and third in the online survey. In total, approximately 44% of the students surveyed believe they have spent more money this year at restaurants than last year.

Parents were also surveyed on their apparel spending in a separate study.

The survey results indicated that spending on apparel for their teens is down 33% from the spring survey and down 19% on a year-over-year basis. Parent spending on themselves is also down 23% from spring 2007 and down 26% when compared to last year. These results suggest that the average consumer is tightening the reins on spending.

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