According to GWI’s ‘The consumer dilemma’ report‘, the cost of living crisis has caused almost half of UK consumers to start spending less than they did in 2020 and 67% of consumers feel that inflation has had a moderate or dramatic impact on them.
Consumers are being more conscious about what they spend their money on, many are feeling less secure with their current financial situation. Luxuries are being cut down on which means things like, meal subscription companies, restaurants and travel agencies could feel an impact.
Another impacting sector, is DIY and home refurbishment. During COVID we saw an increase in buyer activity as more people looked for something to do whilst sat at home. Now that people are spending less time at home and dealing with the rise in living costs, home improvement is grinding to a halt.
Changes in consumer behaviour could still benefit some brands especially those selling second-hand or health and wellness products. Sellers of second-hand goods will appeal to consumers opting to spend less, especially on fashion. Buying used clothing is on the rise, especially within the younger generations.
Consumers are also taking more notice of their health and wellbeing. Health awareness is an increasingly important part of everyday life for consumers who are now more in touch with how they feel. 2 out of 3 consumers are more conscious of their physical and mental health and so, brands should see consumers making purchases that help them keep healthy habits on track.
Reliability and trust
The data also reveals that reliability and trust in a brand or product can be just as important as the price. People want to buy from brands they believe offer longevity and value for money. Consumers are willing to switch to alternatives that offer greater perceived value – even if they aren’t actually any cheaper.