I believe studying how and where people spend their money, especially their discretionary dollars, is an excellent way to gauge how confident they are in their current financial situation.

One of the best examples of this I can think of are 5K races. Here’s why:

• Why spend the $15-40 entrance fee when you can run for free?

• 5K races remain the most popular U.S. running event in both the number of races (15,200 in 2013) as well as the number of participants (8,300,000 in 2013).

• A 5K race does not require expensive gear or training thus opening it up to a wide variety of incomes.

• 5K racers come in all ages and sizes.

• 5K races are not restricted to just select areas. They take place all over the country and during all times of the year.

• The table below shows how the growth of running slowed dramatically during 2007/8 and starting increasing again in 2009.

2013 U.S. Running Events

Distance # Finishers % of Total # of Events % of Total

5K 8,300,000 43.6% 15,200 54%

Half-Marathon 1,960,000 10.3% 2,100 8%

10K 1,480,000 7.9% 3,200 11%

Marathon 541,000 2.8% 1,100 4%

Others 6,744,000 35.4% 6,600 23%

Totals 19,025,000 28,200

Source: Athlinks.com

Here is a listing of the twenty-five largest 5K races in the U.S. along with the number of finishers they had in 2013.

I believe there is nothing as simple yet as complex as selling girl-scout cookies in the office.

If you are a manager and you ask your staff if they want to buy some are being a bully? If you buy from a manager but not from a fellow staff member are you a kiss-ass? What happens to office dynamics if you buy from co-worker “girl-scout parent A” but not from co-worker “girl-scout parent B”? If you say no to everybody, how big of a jerk will you be viewed as?

Here are nine ways (both good and bad) I’ve seen girl-scout cookies sold in the office:

The Good

1. The Santa Claus. Usually a supervisor or manager. They ask everybody in the office what they want and then they buy them exactly what they want as gifts.
2. The Provider of Snacks. Also usually a supervisor or manager. They buy a variety of boxes then open them up for everybody in the office to have as snacks.
3. The Charity Case. They buy from one or several people in the office then give the boxes to a local charity.
4. The Pleaser. Buys exactly the same amount of boxes from everybody who asks so as not to offend anybody.

The Bad

1. The Wait at Your Desk Until You Choose. You know who you are. You stand by my desk with the order form and refuse to leave until I buy something from you. If my stapler was stronger I’d shoot staples at you to shoo you away.
2. The Stalker. As the order form deadline approaches, you’ll see them check off their list of who hasn’t bought anything yet and then they start stalking them one by one.
3. The Rememberer. Hey Joe, remember when I helped you find the printer toner ten years ago…
4. The Dieter. They politely say no to everybody because they are on a diet, yet their diet seems to start and stop with girl-scout cookie season.

The Worst

1. The Flake. They happily order several boxes of cookies yet never remember to bring the money into the office to pay you.

What office girl-scout cookie experiences have you had?

I used to think the marketing and advertising stopped once retailers got you into their stores. Try again.

Here are just some of the ways retailers encourage you to spend more.

Reward Points

No matter what store I’m at or how much or little I’m spending, I always seem to be offered a discount to open and use that store’s credit card. Now I know why.

The Federal Reserve Bank of Chicago conducted a study on the before and after effects with a 1% cash back credit card rewards program and found the average reward people received was $25 per month yet they spent an average of $68 more per month and carried $115 more in credit card debt.

Credit Makes Everything Look Better

According to Dr. Promothesh Chatterjee, an assistant professor of marketing with the School of Business at the University of Kansas shoppers who use cash view their purchases very differently than those who use credit cards.

“When it comes to product evaluation, beauty lies in the eyes of the cardholder,” said Chatterjee. “People who pay with credit cards focus on the benefits and cool features of a new product, while consumers who use cash tend to focus on the price and other costs.”

Retailers—by constantly reinforcing the use of credit cards—may be affecting not just the amount of money consumers spend but also the types of products that consumers buy. “Paying with credit cards may increase the likelihood of indulgent choices that are less healthy compared to cash,” Chatterjee said. “It’s also possible that consumers primed with credit cards may choose more attractive or high-image products among substitutes and may more frequently include brands strongly linked to benefits.”

Take Your Time

Researches from Bangor University and shopping behavior experts and backed by three multi-national grocery companies have found consumers only respond rationally and mathematically for the first 23 minutes of their shopping trip, after which they begin to think with the emotional part of their brain.

Preliminary results also indicate after 40 minutes of shopping the brain becomes tired and effectively shuts down, ceasing to form rational thoughts altogether.

Now I know why many department stores offer chairs/sofas for significant others to rest while their other half shops. The longer someone spends shopping, the less likely they are able to identify discounts and deals.

Mob Mentality

Research by Ahreum Maeng, an assistant professor in the School of Business at the University of Kansas, finds that in socially crowded environments consumers tend to be more receptive to certain marketing approaches. Specifically, Maeng finds consumers in crowded settings prefer safety-oriented options and are more receptive to prevention-framed messages than promotional messages—for example, preferring toothpaste offering cavity protection to toothpaste promising a whiter smile.

“Our findings indicate a store would benefit by selling and marketing products differently on a crowded Black Friday versus a Tuesday morning in August,” Maeng said. “And even within the same day, stores might consider changing their signage or product placement to account for different levels of crowding.”

Music

According to Daniel Levitin, a professor of psychology and behavioral neuroscience at McGill University, Montreal, shopping to music prompts the release of dopamine, delivers a sense of pleasure and helps focus attention. “This could lead to putting people in a generous mood,” he said.

Companies such as Mood Media, in Austin, Texas and PlayNetwork in Redmond, Washington are helping stores encourage this “generous mood” by creating playlists that match the brand and lifestyle of its shoppers.

Tricia Nichols, senior director of global consumer engagement and partnerships at the Gap said their in-store music aims to capture “optimism, democracy and individualism”.

Songs that broke new ground and had a “pioneering spirit” is what Chad Hinson, director of global brand creative at Levi Strauss was looking for when they hired PlayNetwork.

Abercrombie & Fitch developed its loud, heavy-beat music playlists in-house and makes them available on an app.

Larger stores, such as Macy’s even use different playlists for different parts of the store. In its Young Men’s and Juniors’ departments “We tend to put the volume up a little further there,” said Martine Reardon, Macy’s chief marketing officer because “That’s what that customer likes and expects.”

Big Brother is Watching You

E-commerce sites have been tracking shopper behaviors for years but now the trend is moving to the traditional brick-and-mortar retailers.

Stores are using a variety of ways to track their customers from the high tech (tracking Wi-Fi signals from customers cell phones) to the old school (security cameras) with the overall goal of be able to accurately identify what is grabbing shoppers attention as well as what isn’t working.

According to the Future of Privacy Forum, over 1,000 stores around the U.S. are now tracking shoppers.

Mobile Apps

Moving beyond mass-emailed coupons, Apple recently launched iBeacon. These are sensors in a store that sends coupons directly to the shopper with an iPhone who just past by that sensor.

I imagine it says something like “Hey, you! Here’s a 20% off coupon for that sweater you are standing next to.”

Macy’s is testing a similar system from Shopkick in select stores in San Francisco and New York. When a shopper who has downloaded the Shopkick app walks into one of those Macy’s they receive notifications on their iPhone about specials as well as showing them other items they have viewed in prior shopping trips.

Since Timberland rolled out their version of this technology last summer, they are reporting an increase of actual usage of email coupons from 15% to over 35%.

Every year around this time, you will hear estimates on how much shoppers will likely spend during the upcoming holiday season and how this is so important for investors to consider because consumer spending is such a big part of the economy.

Below I have listed headline forecasts for each of the 2009 to 2013 shopping seasons along with how the S&P 500 Index and Retail Sales performed during the following year.

You be the judge how well they have lined up.

Forecast: “Challenging Holiday Season Ahead” National Retail Foundation. Sept 23, 2008

Actual Results: Retail Sales increased by 3% and the S&P 500 Index increased by 28%

Forecast: “Holiday sales expected to fall 1% from 2008, trade group says” Los Angeles Times. October 6, 2009

Actual results: Retail Sales increased by 7% and the S&P 500 Index increased by 10%

Forecasts: “Holiday sales expected to increase modestly” Los Angeles Times. October 7, 2010

Actual results: Retail Sales increased by 6% and the S&P 500 Index fell by 3%

Forecasts: “Retailers expect modest rise in holiday sales” Los Angeles Times. October 5, 2011

Actual results: Retail Sales increased by 4% and the S&P 500 Index increased by 9%

Forecasts: “Holiday sales expected to rise 4.1% in 2012” Los Angeles Times. October 2, 2012

Actual results: As of October 2013, Retail Sales had increased by 3% and the S&P 500 Index had increased by 16%

And here is the latest forecast: “Holiday retail sales forecast is bleak” Los Angeles Times. November 1, 2013.

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