Consumers are learning to live on a tighter budget and cut out unnecessary items, and that has implications for how retailers and manufacturers connect with them, says Nielsen in new survey results. According to the data, 64% of respondents have been affected by rising food prices and 58% by rising gas prices, with rising utility/energy bills (40%), health care costs (30%) and payroll taxes (23%) also affecting some. To cope with these “financial headwinds,” most are tightening their budgets and weeding out non-essentials.
The study reveals the top 3 ways in which consumers are responding to their challenges.
To cope with rising gas prices, they are:
- Reducing trips and conserving gas (80%);
- Living on a tighter budget (67%); and
- Doing more things at home (63%).
To deal with the payroll tax increase, they are:
- Living on a tighter budget (77%);
- Buying fewer things they don’t need (66%); and
- Eating out less often (66%).
To combat rising health care costs, they are:
- Living on a tighter budget (73%);
- Buying fewer things they don’t need (63%); and
- Choosing less expensive alternatives (61%).
Finally, to cope with rising food prices, they’re seeking out deals, living on a tighter budget, and buying fewer unnecessary items (each at 66%).
Nielsen says that consumer behavior supports claims of less spending on unnecessary items, citing several discretionary categories that have seen sales declines this year.
The researchers recommend that manufacturers and retailers “take steps that align with consumer coping strategies and minimize the impact” on sales. Those steps can include “touting benefits like convenient locations, reward programs and at-home consumption.”
About the Data: The data is derived from a survey of 27,896 consumers conducted from March 14 through May 6, 2013.