Report: Inflation Pushes Consumers to Rethink Shopping
Quantum Metrics’ latest retail benchmarks report, “Adjusting for Inflation,” analyzed data from the software company’s clients as well as survey responses from 3,400 consumers in the U.S. and U.K. to identify how rising prices caused by inflation and concerns about a recession are causing consumers to rethink their shopping habits.
A key takeaway from the research is the shift from “spontaneous shopping culture,” curated by big box stores and Amazon, to more planned purchases of multiple items in one checkout. Consumers are also putting more of an emphasis on value as money constraints remain top of mind.
Other trends highlighted in the report include:
- Generic store-brands are the new go-to. As costs climb, consumers are increasingly considering replacing name brands with generic items, particularly in the U.K., where two in three Brits will opt for generic or store-brand health and wellness items (69%) to cut costs. (View graph.) Over half in the U.S. and U.K. (55%) would even go generic for home goods such as furniture, sheets or appliances.
- Consumer technology purchases are taking a backseat. Unlike during the height of the COVID-19 pandemic where many consumers were upgrading their tech to work and study remotely, new and back-to-school tech, such as laptops or tablets, will make up less than 10% of consumer school supply budgets and warranties, parts replacements and other accessory upgrades will likely see a boost.
- Checkout is evolving. Most consumers across the U.S. and U.K. are leaning into interest-free Buy-Now-Pay-Later (BNPL) programs like Klarna to manage costs. There are already concerns that BNPL usage over the summer could have lasting effects on fall and holiday spending. Americans are looking to credit cards: 39% plan to apply for new credit cards ahead of the holidays, and more than half will reserve their credit card points or rewards to redeem for holiday gifts.
- Black Friday and Cyber Monday will be busy. Due to rising costs, four in five consumers (80%) already plan to shop Black Friday this year and 57% of those who will shop the sales have either never done so before or have just a few times in the past. Despite storefronts being fully open, most sales traffic will still happen online with 75% of consumers planning to do most of their shopping digitally.
This report's findings are based on anonymous and aggregated browsing information across a set list of retail sites and native apps collected via the Quantum Metric platform from January 2020 through July 2022. Survey responses were taken from a third-party poll of 3,400 consumers 18 and older, split equally between the U.S. and U.K.