As the cost-of-living crisis continues globally, consumers are making major changes to their spending behaviors, including a majority (53 percent) “holding back” on non-essential spending. That figure includes 15 percent who have stopped spending altogether, according to the 2023 PwC Global Consumer Insights Pulse Survey, which captured the views of 9180 consumers across 25 jurisdictions.
The survey also found most consumers expect to reduce their expenditure across all surveyed categories over the next six months, a significant decline since the previous pulse survey, from last June. Industries including luxury and premium products, travel and fashion expect to see the greatest portion of consumer spending reductions over the next six months, whereas groceries is expected to decline the least.
“The cost-of-living crisis is having a material impact on how consumers purchase, both in-store and online,” said Sabine Durand-Hayes, Global Consumer Markets Leader, PwC France. “As prices rise, consumers globally are cutting back on non-essential spend, while spending more time looking for cheaper alternatives. While every industry surveyed shows an anticipated decline in spend over the next six months, we are nevertheless seeing consumers continue to prioritize products that are ethically produced and sustainable. “
Given that, Durand-Hayes says, retailers wanting to thrive in this challenging macroeconomic environment “must leverage and diversify their distribution channels, offer competitive pricing, invest in greater supply chain resilience, and compensate for customers’ increasing reluctance to share data online by better monitoring their customer base and loyalty programs.”
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