{"id":265,"date":"2023-03-09T14:18:07","date_gmt":"2023-03-09T14:18:07","guid":{"rendered":"https:\/\/www.qualsights.com\/post\/?p=265"},"modified":"2024-02-29T11:51:17","modified_gmt":"2024-02-29T11:51:17","slug":"inflation-is-changing-consumer-shopping-behavior-how-can-cpg-companies-adapt","status":"publish","type":"post","link":"https:\/\/www.qualsights.com\/post\/inflation-is-changing-consumer-shopping-behavior-how-can-cpg-companies-adapt","title":{"rendered":"Inflation Is Changing Consumer Shopping Behavior. How Can CPG Companies Adapt?"},"content":{"rendered":"\n

Sometimes it seems like the last time anyone was sure of anything was in early 2020, before a pandemic turned the world on its head. Hearing that the economy is turbulent and unpredictable isn\u2019t really news anymore. What isn\u2019t turbulent and unpredictable?<\/span> <\/span><\/p>\n\n\n\n

But consumer packaged goods (CPG) companies can\u2019t afford to shrug off economic forecasts\u2014not when they\u2019re influencing consumer behavior and affecting revenue. So, what should companies do?<\/span> <\/span><\/p>\n\n\n\n

That depends on exactly how consumers are responding. <\/span> <\/span><\/p>\n\n\n\n

Where Inflation Is Headed\u2014and How Consumers Are Adjusting Their Shopping Behavior<\/b> <\/span><\/h2>\n\n\n\n

According to the Bureau of Labor Statistics, <\/span>the consumer price index rose 0.5% in January 2023, for a 6.4% year-over-year increase<\/span><\/a>. A more limited measure, the <\/span>core personal consumption expenditures price index, increased by 0.6% in January for a 4.7% increase from a year ago<\/span><\/a>.<\/span> <\/span><\/p>\n\n\n\n

These numbers outpaced expectations, leading to renewed concerns about inflation and the potential for an extended recession. Consumers are responding to the unrelenting economic uncertainty in a variety of ways. <\/span> <\/span><\/p>\n\n\n\n

First, they\u2019re cutting their non-essential spending. But that begs the question: what\u2019s essential? Is brand-name toilet paper worth the expense? What about brand-name household cleaning products\u2014especially as consumers continue to grapple with contagious diseases?<\/span> <\/span><\/p>\n\n\n\n

Then there are the trade-offs. Consumers who cut back on non-essential activities like dining out may compensate by increasing their spending on a replacement activity. That could translate to spending more money on higher-quality groceries. <\/span> <\/span><\/p>\n\n\n\n

With less disposable income, some purchasers may prefer a smaller package that\u2019s less expensive. Others are playing a long game and would rather buy in bulk to pay less per unit at discount stores like Walmart or membership stores like Costco.\u00a0\u00a0<\/span><\/p>\n\n\n\n

Finally, many purchasers shift toward store or \u201cvalue\u201d brands during tough economic times. In 2022, <\/span>store brands saw steady growth, increasing by 11.3%<\/span><\/a> by the end of the year. But <\/span>store brands aren\u2019t always of the same quality that purchasers expect<\/span><\/a>\u2014which could drive shoppers right back to their preferred name brand. <\/span> <\/span><\/p>\n\n\n\n

So, how can sellers adapt to changes in consumer behavior when those changes are highly variable?<\/span> <\/span><\/p>\n\n\n\n

How CPG Companies Can Stay Ahead of Economic Trends<\/b> <\/span><\/h2>\n\n\n\n

There is no one-size-fits-all response for producers, even if you focus on a specific segment of the market. <\/span> <\/span><\/p>\n\n\n\n

But there is one constant, no matter the economic environment: know your customers. We\u2019re not talking about the \u201caverage\u201d or \u201ctypical\u201d consumer. We\u2019re talking about your precise customer personas. <\/span> <\/span><\/p>\n\n\n\n

How do you find out what they want? The typical approach is to assemble a focus group and ask people how they use products and what they look for when making a purchase. But those answers aren\u2019t always authentic or truthful, and running these types of studies can be logistically and financially challenging. <\/span> <\/span><\/p>\n\n\n\n

It\u2019s not that people are trying to be dishonest; they just genuinely don\u2019t remember how often they drink soda or how much they purchase at a time. Maybe two two-liter bottles per week? Oh but wait, aren\u2019t there always at least a dozen soda cans in the recycling bin? Where do those even <\/span>come<\/span><\/i> from? The mundane details of everyday life aren\u2019t something that most of us pay close attention to, so we tend to be poor self-reporters. <\/span> <\/span><\/p>\n\n\n\n

Fortunately, there\u2019s another way to explore customer preferences. <\/span> <\/span><\/p>\n\n\n\n

QualSights combines qualitative and quantitative data so you can generate an exact picture of how your consumer segments use your products\u2014in real time, within their homes. Our <\/span>Product Consumption Intelligence (PCI)<\/span><\/a> technology provides up-to-the-moment data each time a consumer reaches for or dispenses a product, complete with the exact number of grams dispensed per use.  <\/span><\/p>\n\n\n\n

In conjunction with that, our <\/span>Mobile Qualitative Platform<\/span><\/a> provides the contextual details you need to understand the <\/span>why <\/span><\/i>and <\/span>how<\/span><\/i> behind the raw numbers. You can ask users what they\u2019re doing as they use your products or engage them with contemporaneous questions while they\u2019re in the store making purchasing decisions. That way, you\u2019re getting real insights, not faulty perceptions. <\/span> <\/span><\/p>\n\n\n\n

Ready to counteract the effects of inflation? <\/span>Schedule a demonstration today<\/span><\/a> to learn how QualSights can give you the data you need to succeed in any economy. <\/span> <\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

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