Something unavoidable at the moment is the cost-of-living crisis. It impacts every aspect of our lives, from how we heat our homes to what we put on our plates. You only have to look at the price of butter to see how much has changed; the average price of a 500g of Lurpak has risen by 33% compared with June last year and even topped £9 for a 1kg tub in Iceland this week.
Our recent data shows us that 80% of people feel like they have less disposable income, with 2 in 3 being more careful about how much they spend on food and groceries so that they have cash for other, more important, things.
There are lots of ways shoppers are managing this. Our analysis highlights that over 40% are focusing on premium brands by removing expensive items from their basket or trading down to cheaper like-for-like alternatives. This has been echoed by Sainsbury’s CEO Simon Roberts who revealed that customers are increasingly "switching into economy own-label" products and “pulling back” some spending on general merchandise.
But this doesn’t mean that budget brands are safe – 32% of shoppers are simply buying less and going without. We also know that it’s not just the lower-income households that are feeling the pinch in the cost-of-living crisis; 74% of households earning between £50k and £75k are planning to be much more careful with how they spend their money.
So, what does this means for your brand? How are your customers responding to the cost-of-living crisis? Do you know how competitive your pricing structure is? When did you last check in with your customers to assess whether your brand presented good value to them?
The cost-of-living crisis is expected to reach ‘peak pain’ in the early Autumn so there is still time to arm yourself with the right information for your brand to weather this storm. Just reach out - we’re here to help.