Survey: Which direction is CPG spending heading?
Consumers are taking stock of their financial health and how it will affect their decisions to make CPG purchases in the coming months.
According to the new first quarter 2016 IRI Consumer Connect survey, 67% of respondents feel their financial health will improve in the next six months. As a result, CPG spending will generally improve, but shoppers have some specific needs and wants to fulfill.
More than half of consumers (55%) say they will pay more for food and beverage solutions that provide added benefits beyond basic nutrition, such as vitamins, minerals and extra protein. And 55% will also pay more for household cleaners made with environmentally-friendly cleaners. In addition, 36% are regularly buying premium-quality beauty products, while 34% will pay more for environmentally friendly packaging.
The Consumer Connect survey also drills down to the reasons consumers are choosing to shop in specific retail channels for CPG purchases. In addition to common features such as proximity, assortment and service, consumers also are saying the following added frills are important or very important:
59% want a good selection of prepared/easy-to-prepare meals.
53% desire a good selection of local/artisan food and beverage options.
53% are looking for a variety of gourmet food and beverage options.
48% seek technology that makes shopping more exciting.
32% look favorably on stores that offer online purchase options with in-store pickup.
Despite improved financial optimism, consumers are still being fiscally cautious with their CPG purchases. For example:
60% buy bulk to get a lower price per serving/usage.
58% generally purchase the lowest-priced option when buying groceries.
49% will buy over-the-counter medications other than their preferred brand because it’s on sale.
42% often select food and beverage products that aren’t their preferred brands because they have a coupon.
39% will buy beauty and personal care products other than their preferred brands because it’s on sale.
75% buy private-label products to save money.
64% compare prices in circulars to find the lowest price on needed items.
52% visit multiple retailers to keep their grocery bill down.
51% compare prices on area retailers’ websites to find the lowest prices on needed items.
“Knowing your consumers inside and out is the key to success for CPG retailers and manufacturers. Consumers want a consistent and personalized experience,” said Susan Viamari, VP, thought leadership, IRI. “Making a quick sale is nice, but that won’t drive consistent growth. Building long-term relationships and loyalty is the best way to ensure success that starts today and continues into tomorrow.”