New research confirms that consumers are making big changes to how they shop for groceries to save money amid soaring inflation.
A study by supermarket media and promotions business Shopmium found that 77% of shoppers have already taken action to reduce their grocery spend, with a further 10% planning to cut it down imminently.
Driving these changes are reductions in household income, with 63% of people saying they have less disposable income, increasing to 67% for those on lower than average income, 48% of whom say their income has reduced more than 10%.
This is having a major impact on the way consumers in the UK are shopping. With 69% buying less items and being stricter about what they buy, cost is becoming the primary driver in selecting one product over another. The majority of shoppers (79%) are paying more attention to promotions and discounts, with 52% citing an offer for a product as the number one reason they would buy it.
Where previously health or environmental concerns would play into many customers’ purchase decisions, just 6% of those surveyed said their top reason to buy a product would be because it is healthier and 3% because it is environmentally friendly.
Brand loyalty also appears to have gone out the window, with 64% saying they’ve switched to cheaper brands and 58% to supermarket own-label. Even where consumers shop is changing, with 55% switching to lower cost retailers.
The cutbacks are also having an effect on how consumers eat and drink out of home. At work, 69% bring lunch in (an increase of 8% from 2021) and 9% skip it altogether. Less than 1 in 10 (9%) buy it from a supermarket and even fewer (3%) from a cafe or restaurant.
Meanwhile, 25% of those surveyed said they don’t plan to eat or drink out at all in the run up to Christmas, while 68% plan to do so less than once a week. Instead, there appears to be a rise in households planning a ‘big night in’ with 47% of consumers planning a special occasion at home to replace going out, rising to 61% of 25 – 34 year olds.
“Our survey uncovered very definite changes in grocery shopping habits, as the economic crisis intensifies and consumers struggle with reductions to disposable income,” said Stuart Sankey, Head of Shopmium UK.
“Now more than ever, UK shoppers need the support of brands and to feel they are helping address the dire situation many consumers have been left in. Ensuring price points are as low as possible and offering promotions and discounts on the items that consumers most need, such as products for creating quality lunches and dinners, or treats and snacks for a big night in, will go some way towards supporting customers in financial hardship. With brand loyalty abandoned and so many consumers switching to cheaper options, grocery brands must take action if they want a place on shopping lists this winter.”
NAM Implications:
- A classic example of want vs need, in shopping behaviour.
- With Health, Environment and Brand Loyalty the main casualties.
- i.e. time for a fundamental reassessment of their portfolio by suppliers…
- …to identify and communicate a match (of products, not brands) with need.
- And identify any examples of relative competitive appeal…
- And rebuild Brand appeal by delivering more than it says on the tin, every time.
- A basic approach for unprecedented times…
