Post-Recession Consumers Find Ways to Stretch Dollars
U.S. consumers emerged from the recession practiced at stretching their dollars, and now faced with rising food costs, they are turning to the cost-saving tactics they’ve mastered over the past few years.
That’s according to data from the NPD Group’s Economy Tracker, which monitors consumer sentiment about the economy and spending.
“During the recession, consumers adopted thriftier spending behaviors and, as time went on, they became comfortable with making concessions and getting by with less,” said Dori Hickey, author of “What’s Next on the Road to Recovery” and NPD’s director of product development. “At the height of the recession consumers said they used coupons more, were stocking up on sale items, buying more private labels and shopping at discount stores more, among other money-saving strategies. With food prices rising and consumers experienced at getting the most from their food dollars, consumers are going to be increasing these types of behaviors once again.”
According to NPD’s Economy Tracker, a greater percentage of consumers, 21.9 percent, plan to increase their spending on groceries over the upcoming months, which is up from 16.6 percent in February. In March, 40.1 percent of consumers voiced plans to spend more on gasoline over the upcoming months, up from 27.6 percent in February.
With increased spending on commodities like groceries and gasoline, value and price are once again top of mind with the majority of consumers. According to The Economy Tracker, 74 percent of consumers strongly agreed that they expect coupons and special deals will be much more important in deciding what to buy. Sixty-seven percent said that they would shop less in general and 53 percent said that they would be buying in bulk.
Another recent NPD report, “Before the Store: In-home Insights that Drive In-store Purchase Decisions,” finds that staying within a budget is a continual challenge for consumers regardless of food prices or economic conditions. Consumers are more conscious of planning their shopping trips with either a physical or mental shopping list. Among the primary reasons for choosing a store are everyday low prices, good sales and promotions, and location.
“The post-recession consumer hasn’t yet returned to financially stable ground and are now dealing with rising food and gas prices,” said Mark East, president of NPD’s food and beverage unit.“ It’s important for manufacturers and retailers to understand the shifts in consumers’ attitudes and behaviors in light of the economy and rising prices and connect with the consumer both in-home and in-store with a meaningful value proposition.”
The NPD Group is the leading provider of reliable and comprehensive consumer and retail information for a wide range of industries, with more than 1,800 manufacturer, retailer and service company clients.