Over the past six months, a growing number of shoppers has been resorting to crisis-fueled shopping tactics. As inflation lingers on, shoppers find themselves trotting down the ‘stairs of agony’ – from substituting fancy dining for fast casual, takeaway or even staying at home, all the way to down-trading to cheaper brands: The willingness to treat oneself in any shape or form is declining at a very fast pace. We have seen that OOH is the first category being cut, but with more shoppers in a squeeze, more and more budget elements are coming under scrutiny.
Compared to April 2022, when 51% of shoppers worried about inflation in FMCG and changed their behavior, in fall 2022, 46% expect prices to increase even further and will modify their behavior accordingly. When it comes to FMCG, it is not so much about cutting as it is about coping – and we can expect different coping strategies to intensify.
Shoppers will obviously check prices more often, but the strategies showing the biggest increase are “shifting from premium to cheaper brands” and “do more home cooking”. The biggest behavioral gaps between comfortable and struggling consumers are the efforts of the latter group to keep their basket low and to abstain from any treat: gratification has no place in the baskets of households facing a budget squeeze.
Coping behaviors intensify
Coping strategies obviously differ by category, from buying less or only on promotion, to stockpiling, discontinuing or buying at a different retailer, just to name the most important ones.
With a big group of consumers buying only what they really need, some product categories will inevitably have difficulties to make it into the shopping basket. The top five categories, where worried shoppers declare to change their behavior even further include alcoholic drinks, confectionary, cosmetics, frozen food, meat and fish.
Categories affected by further behavior change
The main challenge for manufacturers will therefore be to make sure, that their categories and products are top of mind, firmly placing category occasions and easy of buying into focus.
Across all categories that GfK measures, two strategies are growing: planning to not buy certain products at all increases by +26% – especially alcohol and frozen food –, and wanting to buy cheaper products grows by +8%, including cosmetics, meat and fish.
