Nearly two-fifths of adult shoppers are having trouble buying the basics while covering their bills, our latest shopper research shows. This may be expected, due to a price crisis, but what we didn’t expect was the broad scope of their demographics. Retailers and brands, meet what may be the greatest challenge of 2022: The Struggling Shopper.
Today, “Struggling” is Complicated by Circumstances
This is the issue for almost 90 million shoppers today who are struggling to bring home just the basics they need and still be able to pay their bills, our How America Shops® research concludes. The figure represents 37% of adults, but here’s the thing: 62% of those adults earn an income of more than $50,000.
The belt-tightening, therefore, is not due to their income levels, our shopper insights reveal; it’s due to a convergence of unexpected factors, such as rising prices on everything from baby formula to vegetables, skyrocketing fuel costs and debt. These shoppers have been blindsided by circumstances, and they have had to change what and how they buy just to keep the lights on.
The evidence of how well-off many of these shoppers are is stark, in the demographic breakdown of our latest How America Shops® respondents:
- 40% earn a household income of $50,000 to $100,000,
- 22% make more than $100,000.
- 44% work full-time.
Flashback to the Darkest Days of Covid 19
A look at how escalating gas prices alone are altering shopper behavior provides keen insight into the hard choices they are making.
From March 2022 to May 2022, the percentage of shoppers cutting back on gas purchases rose by 7 percentage points. These cutbacks, of course, require that shoppers reduce trips to various places. Topping that list is trips to the store, followed by a reduction in socializing.
In a way, we are reverting to a pandemic-enforced lifestyle of solitary confinement. But instead of the Covid health crisis, this confinement is due to a wealth crisis.
No Shopper Should Be Left Behind
These shoppers are seeking out retailers that provide solutions to meet their narrowing budgets. Here are three suggestions of what retailers and brands can do, based on our shopper intelligence.
- Bring value, because the value chains are winning, again. No surprises here. Dollar chains, Aldi and Lidl were winning over shoppers before prices began to soar, and now more shoppers are turning to them as well as to Walmart. And some chains are expanding their appeal: The youth-targeting discounter Five Below’s store-within-store “Five Beyond” sections include higher-priced categories a bit above $5, but still at approachable prices.
- Make a trip to your store an adventure. More than half of shoppers are reducing recreational trips to save gas. A retailer can bring adventure to shoppers not just through free entertainment like live music, but also with unexpected finds. Aldi and Lidl’s center aisles, with their rotating selections of bargains, entice shoppers to discover items they could afford to “splurge” on.
- Promote heavily near low-priced fuel. One-third of shoppers will go out of their way to buy less-expensive gas, and one-fourth are combining trips. Gas promotions will win shoppers’ hearts, and they will remember that support when gas prices find their own “new normal.”
Look, we get it that retailers also are struggling with higher expenses. But when their middle-income shoppers can’t afford to buy the basics and pay their utility bills, it becomes a retailer and brand problem. Invest in caring for these shoppers now, and it will pay dividends when prices go down.
To learn more about WSL’s “Struggling Shoppers!” report and other How America Shops® research into how shoppers are changing retail’s path, visit our resources page here.