Consumer focus on prudence presents firms with new challengesby
Nearly a third of shoppers have made major changes to their spending habits over the last seven months, with 'prudence' and 'economising' being the key watchwords of the day.
According to a survey among 1,000 UK adults who are the main grocery shoppers for their household undertaken by market research firm Shoppercentric, some 31% have made big changes to their purchasing behaviour as a result of the ongoing difficult economic climate compared with 75% that have made only some alterations.
This is despite the fact that only 12% of those questioned said that they had been hit by pay cuts and freezes or a drop in hours, which had led to a fall in expenditure.
But such cautious behaviour is only set to continue as 54% said that they expected the government’s proposed budget cuts to make things worse for them financially compared with 30% that do not anticipate seeing any real change. A mere 16% think the government’s cost-cutting action will make things better for them.
Danielle Pinnington, managing director at Shoppercentric, said: "It’s still a very challenging time for a lot of people – despite reports of green shoots on the horizon. Difficulties in managing budgets don’t just disappear overnight and many people will have gone into debt to just keep afloat. It’s a case of looking at how and where they can make savings and work towards recovery."
She added that a continued focus on prudence presented retailers and manufacturers with new challenges and opportunities to listen to consumers’ needs and offer them suitable pricing and reward strategies.
The research indicated that 87% of consumers were now adopting just such an attitude of 'prudence' when making purchases, while 82% were 'economising'. A further 76% were also switching stores in order to shop more cost-effectively.
"Prudence has the potential to become a long-term trend, to become learned behaviour among shoppers," Pinnington said.
And this approach was being adopted across the board. Of the hardest hit economically, some 51% said they were reducing expenditure on clothes and shoes, while just under half were cutting back on going out and eating out. A further two out of five were scaling back on holidays, while a third were tightening their household and grocery shopping budgets.
Women appeared to be the hardest hit demographic, however, both in terms of straitened circumstances (15% of females had lost their jobs compared with 11% of men) and introducing changes to household spending (87% of females compared with 79% of men).
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