Consumers are cutting back, budget brands could thrive - Toluna report
As cost-of-living rises dominate headlines, timely UK research shows 44% of consumers now have less money than they did pre-Covid and 37% are not confident about spending money over the coming months. That’s according to the Toluna Global Consumer Barometer Study.
Those are two figures the UK fashion industry won’t enjoy. What’s more, with only 14% making their buying decisions based on the environment, sustainability-driven products could also have a tough time ahead of them as far as price-conscious consumers are concerned.
As rising energy costs and wider inflation drive financial frugality, 54% of the 1,066 people surveyed said they will now choose a new brand, product, or service based on price or cost. It also noted 20% of those interviewed are worried about job security and will spend less as a consequence.
Looking back to December, financial struggles had begun to weigh heavily on people’s minds with 48% saying they were concerned about being able to afford Christmas. Some 10% of respondents were “extremely concerned” about being able to afford the event.
Additionally, 38% of people used credit to afford Christmas, and 33% said their financial situation had changed since previous years so they spent less on Christmas gift shopping in 2021.
In such times, cost-cutting historically hits the fashion industry, so price will become even more of an issue with value-focused retailers likely to increasingly become consumer favourites.
Lucia Juliano, UK Head of Research at Toluna said: “It’s clear that we’re living with the long-lasting impact of Covid-induced repeated lockdowns, ongoing restrictions, and uncertainty around the economy. Couple this with rising energy costs, inflation, and other household bills, and you have a perfect storm of financial worry and uncertainty.
“As the cost of living rises, people are choosing to spend less and save more, with insecurity around personal finances remaining high.”
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