After a year like 2020, it’s no wonder consumer attitudes and behaviors are expected to change significantly. The economic impact alone is having a long-term effect on spending habits.
Vericast worked with a global, third-party market research firm to produce the 2021 Consumer Intel Report “A Cautious Return to a New World,” which looks at how consumers are cautiously returning to the new world.
A key finding from the report is that 70% of people whose income was affected in 2020 expect their spending power to continue to be impacted in 2021. For marketers, it will be critical to find ways to meet consumer expectations by providing value through deals and savings.
The need to save
Practically, consumers need to save, and they are looking for savings on everything, especially their essential needs. Vericast research also found that 82% of Americans say it’s most important to them to save the most money by picking a grocery store with the lowest prices.
In fact, the search for deals is a virtually universal phenomenon that every brand and retailer must consider.
And it is a trend that will remain as the number of consumers seeking ways to save more money has risen by 5 percentage points from 33% in 2020 to 38% in 2021, according to the Vericast survey. Most people have been finding ways to save more money during the pandemic, and 82% plan to continue this behavior.
Uncertainty, coupled with tough economic conditions, will drive consumers toward brands that offer deals and discounts. As people adjust to new variables in their lives, their cautious behavior will go beyond budget decisions.
In trying times, savvy shoppers become more price sensitive. They shop smarter and look for deals to get the biggest bang for their bucks. In fact, according to McKinsey & Company, 30% to 40% of consumers will switch brands or retailers to get the most value.
Loyalty is up for grabs, and the best deal wins.
Relevant messaging can make the sale
People remain sensitive to deals and deal messaging as they were pre-Covid. Fifty-two percent say that a sale will lead them to make an impulse or unplanned purchase. Meanwhile, 37% of shoppers indicate that messages offering coupons or discounts will increase the likelihood that they’d buy from a specific brand.
While deals and affordability play an important role in consumers’ purchasing decisions, they aren’t enough on their own. Messaging and promotions must be nuanced to balance the latest consumer sentiment (e.g., a brand’s social and environmental responsibility) with their financial needs.
For instance, 51% of consumers say that a relevant and engaging brand message can entice them to try a new product—a 5-percentage point increase from 2019. What you offer, where you place the deals and how you serve your customers all matter.
Ads and coupons attract affluent consumers
Seventy-four percent of consumers overall indicate that they can be swayed by ads that promote sales and incentives when deciding what to buy and where to shop. Deals can determine what goes onto a shopper’s “must-buy” list. This means brands can leverage promotion opportunities to influence consumer decisions during the planning stage.
The rise in price consciousness isn’t just among shoppers who are negatively impacted by the pandemic. Affluent consumers (those with a household income over $100,000) also demonstrate preferences toward deals and incentives. Seventy-nine percent of these shoppers use coupons when planning their shopping, 79% are excited to discover a deal on a product they’re already thinking of buying and 64% say a coupon or discount speeds up their decision to purchase.