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Amid the din of the forthcoming presidential election comes fresh insights from IRI that forecast feeble consumer spending in 2017, regardless of which candidate emerges victorious. Accordingly, forewarned is forearmed for trading partners seeking to get a handle on how consumers’ shopping behavior might change with a new administration.
While consumers have been generally feeling a bit more upbeat about their personal finances during the past couple of years, results from IRI's Q2 2016 Consumer Connect database – gathered from an online survey of more than 2,200 nationally representative respondents in the first half of June – find that 64 percent of consumer panelists believe that their households’ financial health will decline if Donald Trump is elected, versus 60 percent if Hillary Clinton is elected. In addition, 36 percent believe that their households’ financial health will improve if Trump is elected, compared with 40 percent if Clinton is elected.
“While Americans’ attitudes towards personal finances have improved in recent years, this election process appears to signal a shift in consumer sentiment,” said Susan Viamari, VP of thought leadership for Chicago-based IRI. “However, the changing of the guard at the White House always represents uncertainty, but this year close to 60 percent of consumers feel that their financial health will deteriorate no matter who is elected president. This will absolutely impact retailers and CPG manufacturers as they brace for a tightening of the purse strings.”
Silver Lining Found in Indulgent Splurges
For years, IRI has been studying the types of trade-offs that consumers make when they feel that their budgets are being squeezed. Some behaviors, such as list-making and shopping at multiple stores, become part of the regular routine, even when finances are looking stable or improving.
But there's a silver lining in the form of indulgent splurges, for which there will always be a place in consumers' hearts – if not on their tightened-up shopping lists.
The categories that IRI finds to portray a sunnier outlook, regardless of who's elected the new commander-in-chief, factor heavily in the all-important fresh food departments and better-for-you mainstays, such as:
- Gourmet food and beverages
- Local/artisan food and beverages
- Prepared/easy-prep meal solutions
- Fancy natural/organic food and beverages
Other interesting stats from IRI's pre-election panel include 48 percent of consumers who wish for technology to make shopping the store more exciting, and 39 percent who would like the ability to purchase online and pick up in store, both of which are guaranteed to raise clout among retailers as well.
"When it comes to decoding the consumer mindset, there is perhaps nothing more complicated than predicting how a significant transition, such as electing a new president, will impact the way consumers feel and behave,” noted Viamari. As such, grocery trading partners "must be more vigilant than ever as the torch is passed, and ready to respond in real time to shifting attitudes that ripple through the marketplace.”
More info on the latest insights from IRI's Consumer Connect – a new quarterly survey designed to gauge consumers’ financial confidence and understand how their financial situations are impacting the way they shop for, purchase and consume CPG products – can be found here.