Although inflation has started to moderate, the surge of the past two years has left a lingering anxiety in the minds — and spending habits — of American consumers.
Grocery shoppers continue to be wary of higher prices at checkout, and a significant number report making changes in their purchase behavior to stretch their budgets, according to results from the just-released Advantage 2024 Shopper Outlook survey of more than 8,000 shoppers by SMARTeam CPG Consulting, a division of Advantage Solutions.
The survey, which ran from October 31 through December 5, found that 55% of shoppers have switched to buying less-expensive options, while 52% say they have switched to lower-priced brands.
More than half (54%) have reduced how much they buy, and one-third say they have changed where they shop for groceries to save money. Twenty percent of shoppers surveyed say they are skipping meals to save money.
Less than half (41%) say their shopping habits haven’t changed.
“It’s tough out there for consumers. Their new normal is the constant lookout for deals across products and retailers,” says Jill Blanchard, president, enterprise client solutions at Advantage. “Their assessment of their ability to afford everyday essentials has hit a new low — it was close to 60% in 2019, now it’s 40%. And debt is now costing people more to pay off — credit cards, personal loans, auto loans — which exacerbates these daily concerns.”
There is some good news in consumer packaged goods, however, as most manufacturers say they’re holding off on further price increases, and only one-third are planning price increases on their ancillary items, Blanchard says.
Consumers are also paring down — transitioning from out-of-home entertaining to in-home, from luxury brands to mainstream brands, from prepared meals to cooking. “Paring down means different things to different consumers, and manufacturers and retailers are catering to this value mindset with marketing, promotions and private brand products,” Blanchard says.
Other findings from the survey include:
- Nearly two-thirds of shoppers (65%) say they have a few preferred stores, depending on their shopping list. Just over a quarter (27%) are dedicated to one retailer, resuming pre-COVID habits after a significant shift in 2021 when 37% of shoppers reported going to the same store nearly all the time.
- Most shoppers remain loyal to their favorite stores. Just 7% say they shop at a number of stores for groceries and do not have one favorite store.
- More than half (53%) of shoppers choose a retailer based on sales and promotions. Two-thirds of shoppers choose their primary retailers based on everyday low prices.
- Half of shoppers will choose their primary retailer based on having the best assortment of products available.
The Advantage 2024 Shopper Outlook was sponsored by Advantage Customer Experience; Ajinomoto; Pete & Gerry’s; RIOT Energy; StarKist; Daisy Brand; Musco Food Corp.; The Krusteaz Company; Reynolds Consumer Products; Upfield; and Utz Brands.
For more insights, download the full Advantage 2024 Shopper Outlook here.