The talk of inflation is everywhere as rising interest rates cause economic unrest across the globe. Multinational conglomerates and tech giants announcing massive layoffs also compound what is turning out to be one of the most stressful periods for consumers in recent history. To help us better understand consumer stress and its relationship with price sensitivity, let's take a quick look at how consumers are responding to the economy and how CPG companies can make the best out of marketing to a stressed-out consumer.
A recent Brightfield Group survey asked 26,000 consumers about their stress levels. Over a third (37%) of respondents said that they were either very stressed or stressed, an increase of 8% from just a quarter before.
Compared to last year, American households are being forced to spend $445 more per month to keep up with daily demands. Inflation continues to wreak havoc on household earnings, peaking at 9.1% in June. From food expenses to airfare, utility bills, and health care costs, American households are having to deal with more expenditure on fixed and sometimes less income.
While inflation is the main contributor to consumer stress, the holiday season is also contributing a sizable share. Holiday shopping comes with tons of considerations for consumers and inflation only adds to the financial stress of the season.
To make the best out of the present reality, people are finding creative ways to cope with the rising consumer stress across board.
Changing spending habits
Spending habits are rapidly changing in response to rising consumer stress. According to a survey conducted by leading consumer insights platform Evergi, 46% of Americans believe that healthy foods cost too much to be kept up with during the current inflationary cycle. This is a jump of 6% from last year which indicates that more and more consumers are making purchase decisions on price considerations as other factors such as health, are taking a back seat.
Focus on mental health
Rather than budgeting for a mid-summer getaway in the Caribbean or shelling out precious dollars on stress medication, more and more people are focusing on mental health and mindfulness practices as solutions to combat stress build-up.
Using less traditional medicine
Alternative medicine is on the rise as skyrocketing health insurance and medication cost is forcing 40% of Americans to try alternative options first before going to the doctor. Overall, 47% of people now use less traditional medicine, while 53% are resorting to “superfoods” as medicines for their ailments.
Stressed or not, consumers continue and will continue to shop. So how do dynamic brands make the best out of the situation and find effective marketing strategies for stressed-out consumers? We have a few ideas:
1. Personalize Brand Messaging & Positioning
43% of consumers say that the brands they buy from are part of their identities, while 58% of them make it a point to research brands on social media before buying products. Companies need to invest in understanding what their demographic of potential customers stands for. This will enable them to closely position themselves to those ideals or at least stay away from things that their customers dislike. The more a brand makes the investment to fine-tune their product and their marketing to meet their customer’s personal tastes, the better their chances of continuing to sell even when the consumer is very stressed.
2. Maintain Quality
With or without personalization, many consumers will never compromise on quality. 65% of shoppers in the US say that high quality is worth the extra money they pay for products. This clearly indicates that regardless of the consumers urge to cost-cut, many people will choose a slightly more expensive product if it promises above-average quality.
3. Express Empathy for Consumer Pain Points
Lastly, it is very important to remember that consumers (especially wellness-focused consumers) value empathy in their brands. 60% of shoppers believe that companies should support philanthropic. Caring for more than just revenue allows consumers to align themselves with the brands that they see fighting on their behalf on causes that the average consumer might not have the resources to make an impact.
By personalizing brand messaging, maintaining quality and expressing empathy for the consumer, marketers and the brands they serve have a clear roadmap for pushing past consumer stress to meet company goals.
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