A new report has found that a significant number of consumers are turning to cheaper brands in response to rising costs.
Majority of consumers turn to cheaper brands to fight inflation costs
Jungle Scout’s Q2 2022 Consumer Trends Report showed that 59% of consumers are not only reluctant to spend amid current inflation, but are instead finding cheaper alternatives to the products they want. The report also notes that while inflation continues to affect consumer spending, social media, pricing and brand loyalty remain important factors in consumer behavior.
Valuable insight into consumer behavior during inflation
Founded in 2015 as the first Amazon product research tool, Jungle Scout is now the leading all-in-one platform for e-commerce sellers on Amazon, with annual Amazon revenue exceeding $40 billion.
The company conducted their anonymous survey between May 6 and May 10, 2022, which surveyed 1,000 U.S. consumers about their purchasing preferences and behavior. Respondents represented 48 different US states, including all genders, and were between the ages of 18 and 75. Respondents were also from a wide range of work types and income levels.
Results published by Jungle Scout show that 35% of consumers have purchased a product after watching a social media brand’s live stream. Another 42% say being ‘followed’ on the web by ads is a helpful reminder, although 32% say the tactics ‘slipped’ them.
Nearly half of consumers are more likely to shop with a brand that has consistently lower prices, while their willingness to switch to a new brand when it’s cheaper increased 12% quarter over quarter.
The most trusted social media platform for finding and buying products was YouTube, followed by Facebook and Instagram.
Consumers ‘still investing’ in retail economy
Jungle Scout’s CMO Mike Scheschuk said of his company’s findings: “Despite inflation concerns, consumers are still investing in retail and turning to e-commerce for the best deals.
“What changes are the products consumers buy and the factors that influence their purchasing decisions. Brands need to reassess their strategy as social media and affordability are reshaping the retail landscape. By optimizing their online presence, brands can connect with customers, better understand their needs and ensure loyalty in these uncertain economic times.”
Report highlights generational differences
The Jungle Scout report also revealed several behavioral changes according to a consumer’s generation. The survey found that millennials were less likely to sacrifice their shopping habits to cut costs compared to baby boomers, who were nearly twice as likely as millennials to miss out on certain products to cut costs.
Only 35% of millennials would buy a cheaper brand to save money, while baby boomers are more likely to shop in-store so they don’t have to pay shipping.
The report also noted that two out of three American consumers shop on Amazon, most of which are loyal Prime members. Just under half of them said they would likely shop on Prime Day this year, and nearly 90% of Amazon Prime members surveyed said they would likely keep their Prime membership for another year.
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