To examine how consumers’ shopping behaviors and attitudes are affecting non-edibles, IRI also released a new report: “Where’s the Non-Food Growth?”
“Our quarterly index indicates that consumers do not feel like they are on the economic roller coaster as they did in the past,” said Susan Viamari, vice president of Thought Leadership for IRI. “People are opening their wallets more and spending, but they are still very selective about what they will spend their money on. Obviously, people need to eat, so they are spending more freely on food and beverages. However, they are looking to stretch their dollars a bit more in the non-food aisles.”
Results from the Q2 2018 Consumer Connect survey reveal that select consumer sectors are still struggling despite the healthy economy. In addition to these money-saving strategies, consumers are simply buying less to spend less. This is having a clear negative impact on non-food unit sales trends, according to IRI.
However, all is not doom and gloom for the CPG industry — there is reason for optimism. The economy appears to be on a positive trend, and many consumers expect that their financial position will improve throughout the remainder of the year. Even among groups that are struggling, consumers expect their household’s ability to save money will improve: 58% (total), 64% (households with kids), 54% (households with income less than $35,000) and 43% (Hispanics). In addition, these groups are showing a willingness to invest more in premium-tiered CPG solutions during the next six months: 30% (total), 28% (households with kids), 31% (households with income less than $35,000), 22% (Hispanics).
CPG brands and manufacturers also have opportunities to entice consumers to spend more to trade up to higher-end products and/or to get select benefits.
“CPG brands and retailers need to continue to think creatively and strategically in order to bring consumers what they want: excitement, convenience and value,” added Viamari. “Consumers are smart and they have choices. They know that they can shop around and they know that their choices are virtually unlimited. Brands and retailers that can stand out with a strong value proposition are the ones that will satisfy today’s choosy shoppers and be rewarded with growth and loyalty.”