Mumbai: Capgemini Research Institute published a report on 2023 consumer behaviour for products in retail industries. It is a navigating experience for consumers at large here are a few highlighted observations. Consumer behaviour is paramount for identifying market trends and analysis for future market anticipations.
Importantly, this research report is based on five basic themes of purchasing patterns, cost of living, raising concern over essential products, fulfilment beyond in-store experiences, and rise of social media influencers.
According to report observations and key findings, the majority (61 per cent) of consumers globally are extremely concerned about their personal finance situations. For Millennial (66 per cent), Bommer (55 per cent, and Gen Z (60 per cent) consumers as a whole. Consumers are worried about the increasing cost of living. 73 per cent of consumers are making fewer impulse purchases. 69 per cent of consumers are cutting costs on non-essential items such as electronics, plants, toys, and other non-essential products. More particularly cost-cutting measures or delaying the purchase of luxury items with convenience.
Interestingly, the new trendsetter part of the report highlighted more than half of consumers (65 per cent) of consumers said that they are buying products preferring cheaper private label products over branded products. 64 per cent of consumers prefer to buy products from hypermarkets, and discount stores. Over 75 per cent of consumers are spending more time and energy to fund deals and discounts from physical stores. Consumers are navigating different ways to adopt affordability. The cost of living crisis forces consumers to lead to more sophisticated purchasing patterns or behaviours.
Commenting on report findings, Unilever CFO Graeme Pitkethly said, ‘ We are starting to see consumers down trading and looking for greater value. Sales volume are beginning to fall as some shoppers switch from branded goods to own-label products in a bid to make ends meet. In another observation, 44 per cent of consumers said that they are reducing overall spending this year as compared to 33 per cent in November 2020.’
A paradigm shift in consumer patterns after Covid 19, consumers started spending less since the pandemic period. The majority of consumers globally expect companies to help them through this difficult time.
Also while navigating the best options for in-store and online sales for discounts and deals, still consumers’ preference for in-store shopping is declining amid the cost of living crisis. The slight decline from 67 per cent to 58 per cent in 2023 is an indicator of declining purchasing behaviour for in-store experiences. According to a survey in Capgemini Research in November 2021 survey, 38 per cent of consumers said they have significant interactions with retailers’ online channels. Consumer interactions with online retailer’s channels came down to 33 per cent in November 2022. But the long-term outlook increased to 38 per cent suggesting stabilisation and growth more from pre-pandemic times.
According to last year’s survey, consumers are spending their purchases across physical and online channels. As per the latest data, 40 per cent of consumers spend less on groceries across all channels. As per report identification, consumers can shift to physical channels in case of non-available basic necessity products. Around 40 per cent of consumers are more likely to switch stores or online stores as per contingencies.
According to the report section on sustainability and affordability parameters, more than half 54 per cent of consumers globally, they are preferring affordability over sustainability when making purchasing decisions. Rural consumers are buying less and recurring purchases of brand products as compared to urban consumers.
According to reports, social e-commerce generated 724 billion dollars in revenue in 2022. Social commercial revenue is expected to realise a CAGR (Compound Annual Growth Rate) of 30.8 per cent.
It is clear from the data Gen Z is considerably influenced by social influencers at large. 34 per cent of all global consumers learned about brands over social media while 22 per cent found new brands through TV ads.
According to research consumer behaviour is concerned with financial decisions, price consciousness, and changing adaptability.
Retail continues to paradigm shift in recent years which is driven by changing dynamics of consumer behaviour and expectations. Brands have to respond to ever-changing patterns of customer demand, shifting geographical situations, and global supply chain pressures. Inflation globally forces consumers to increase concern over affordability.
