Household spending has shifted due to high inflation and economic uncertainty. Consumers are prioritizing essential items like groceries while often forgoing discretionary purchases, including games, apparel, and prestige beauty. Circana’s Sally Lyons Wyatt, global EVP and chief advisor for consumer goods and foodservice insights, and Adam Mellott, vice president of consumer and shopper insights, provide valuable insights into the current state of household spending, the role of retailers, and the resilience of consumers during challenging times.
Highlights:
- Consumers are carefully weighing their options at the shelf, which doesn’t necessarily mean the end of indulgent and premium purchases.
- Many retailers, notably within the dollar channel, are putting value – including convenience and affordability – front and center, which is proving attractive to a wider audience of shoppers.
- Urban and rural consumers are reacting to economic uncertainty in different ways, which will impact product assortments, oftentimes within the same retail chain.
- While tariffs haven’t impacted CPG prices yet, consumers will be tracking prices carefully.
- Innovation – from product development to assortment – can be critical to locking in consumer loyalty during challenging times.
