Shopper confidence in the UK has declined to its lowest level in a year as people grow increasingly concerned about the rising cost of living, with ‘savvy shopping’ likely to be the key trend in the months ahead.
This is according to the latest Shopper Confidence Index from IGD. It highlights that concerns around food price inflation are at their highest since March 2013 with 85% of shoppers expecting food prices to get more expensive next year (vs 79% in August).
Following a small but consistent decline for the last four months, shopper confidence fell to -9 (vs -4 in August) which is its largest recorded monthly decline. Amid a wave of news about the rising cost of gas and food, IGD found that confidence declined steadily throughout September and fell to -14 at the end of the month.
Overall financial confidence fell sharply in the month with 31% of shoppers expecting to be worse off in the year ahead (a 9% increase vs August). Confidence declined across all shopper demographics, but more so among lower-income households.
The IGD research found that 21% of shoppers now expect to focus more on saving money rather than quality next year (a 6% increase on August).
“This month’s Shopper Confidence Index is a sobering read and we anticipate it will be a similar story next month, following the steady decline we’ve seen throughout September,” said Simon Wainwright, Director of Global Insight at IGD.
“Moving forward shopper focus will be on value for money and we will see much wider adoption of the 2021 ‘Savvy shopping’ trend as shoppers look to save money, with many switching to private label products, motivated by seeking out savings. The discount channel is forecast to be the fastest-growing grocery channel over the next five years and we will see many shoppers shift their shopping behaviour to make cost-savings from this channel.
“Shopper confidence will remain very fragile for the foreseeable future so retailers and suppliers will need to focus on building loyalty by supporting their customers’ needs by offering value for money.”
NAM Implications:
- …and this merely week 1 of post-furlough.
- We would suggest that 18 months of reflective Lockdown has caused savvy consumers to morph into Super-savvydom..
- Watch this space!
