PJC Piper Jaffray Companies

MINNEAPOLIS, Oct. 10 /PRNewswire-FirstCall/ -- Piper Jaffray & Co. recently announced the results of its 14th biannual proprietary research survey, "Taking Stock With Teens," a national study on teen spending habits and retail brand perceptions. After conducting mall research field trips in 10 cities across the United States and surveying approximately 980 students, the Piper Jaffray retail research team published key findings for teens' purchasing behaviors 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 organization 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 percent 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 percent versus a decline of 9 percent 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 percent 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 percent 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 favorite 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 ten 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 favorite home furnishing retailer or cataloger in the survey. Privately-held, Swedish-based IKEA was again the top choice, followed by Pottery Barn/PB Teen. -- Eighty-three percent of teens indicated they own at least one video game console and 51 percent own at least two video game consoles. Sixty-two percent of teens 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 percent of video game purchases, which is consistent with spring 2007. -- When asked about buying habits of MP3 players and online music, 82 percent of the students who own an MP3 player indicated that they also own some form of an iPod, which is up from 79 percent in fall 2006. Purchasing online music is becoming more mainstream as 64 percent of the students surveyed indicated they download music illegally, compared to 72 percent at this time last year. iTunes continues to dominate market share at 79 percent. In addition, after only three months of availability, 3 percent of the students own an Apple iPhone, and 9 percent 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 percent 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 percent from the spring survey and down 19 percent on a year-over-year basis. Parent spending on themselves is also down 23 percent from spring 2007 and down 26 percent when compared to last year. These results suggest that the average consumer is tightening the reins on spending. About Piper Jaffray Piper Jaffray Companies is a leading, international middle-market investment bank and institutional securities firm, serving the needs of middle-market corporations, private equity groups, public entities, nonprofit clients and institutional investors. Founded in 1895, Piper Jaffray provides a comprehensive set of products and services, including equity and debt capital markets products; public finance services; mergers and acquisitions advisory services; high-yield and structured products; institutional equity and fixed-income sales and trading; and equity and high-yield research. With headquarters in Minneapolis, Piper Jaffray has 25 offices across the United States and international locations in London, Hong Kong, Shanghai and Beijing. Piper Jaffray & Co. is the firm's principal operating subsidiary. (NYSE:PJC) (http://www.piperjaffray.com/) Since 1895. Member SIPC and NYSE. (C) 2007 Piper Jaffray & Co., 800 Nicollet Mall, Suite 800, Minneapolis, Minnesota 55402-7020 DATASOURCE: Piper Jaffray & Co. CONTACT: Rob Litt of Piper Jaffray & Co., +1-612-303-8266 Web site: http://www.piperjaffray.com/

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