According to a recent report from NielsenIQ, global consumers show determination and resilience during the continued economic challenges.
The ‘Mid-year Consumer Outlook’ for the first half of 2024 points out that from cautious, people now move to intentional consumption. Compared to 12 months ago, only 32% of consumers feel worse off financially – a big improvement on the start of 2023.
This bounce in consumer confidence would hint at a growing economic optimism, even as challenges persist. However, many concerns continue to weigh upon the minds of consumers: utility expenses, driven by soaring food prices, are some of the top factors weighing heavy on the minds of consumers with the threat of an economic downturn.
As inflationary pressure starts to ease, consumers are less obsessed with increased everyday bills, the report observes, and more concerned with personal welfare, happiness, and job security. This trend underlines the state of consumer determination and their intent to make more purposeful spending decisions as they head into 2025.
Inflation by various product categories, as analyzed by NielsenIQ, indicates some interesting trends. The highly inflated departments include Home Care, Confectionery & Snacks, and Pet Food. Categories such as Frozen Food, Food Perishables, and Health Care are among those seeing easing prices. For companies in these categories, the challenge will be to drive additional volume without overpromoting or devaluing their offerings.
Growth above inflation is achievable, but an integrated understanding of all the available consumer targets and how consumers at different income levels allocate their spending across categories is needed. So, while economic tensions may still be high, consumers are likelier to show a little more leeway when purchasing.
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