Rising food prices keep pandemic habits among consumers alive

According to the PwC Global Consumer Insights Pulse Survey 2022, 47% of respondents expect food prices to increase for at least 6 months.

Consumers around the world are facing rising prices. Over 75% of respondents to the PwC Global Consumer Insights Pulse Survey 2022 expect spending to be the same or higher than today across most product categories over the next six months.

Notably, 47% of respondents plan to spend more on groceries, and many plan to cut spending on luxury and premium products (37% of respondents), restaurants (34%), arts, culture and sports (30%) and fashion ( 25%).

“Over the past two years, consumer resilience has been tested by supply chain disruptions and restrictions. Although consumer enthusiasm has returned after the lifting of restrictions due to covid-19, rising inflation and interest rates are putting new pressure on spending and consumer behavior. We do not expect this pressure to ease anytime soon. The survey shows that people expect further price increases and are looking for ways to adapt their shopping habits to the new environment without giving up on factors like the best shopping experience or favorite brands. At the same time, retailers and manufacturers have to cope with both consumer demand and their own inflation and supply chain pressures. Companies that can handle multiple disruptions while maintaining their customer focus will be in the best position to emerge victorious from this challenging environment,” said Ruxandra Tarlescu, Partner and HEAD of Retail, PwC Romania.

Rising prices and the lack of certain items in stock affect the shopping experience

Overall, food price increases were the most common shopping experience issue reported by consumers shopping in-store (65%) and online (56%). More than half of the consumers surveyed, 57%, say they almost always or often face rising food prices. The United States and CANADA, at 69%, are second only to South Africa (76%) and Brazil (74%) in the list of countries with the most respondents experiencing food inflation. Supply chain issues were also seen as affecting the shopping experience, most notably the inability to purchase a product due to being out of stock (online, 43%; in-store 37%). Consumers also report longer delivery times for online purchases (42%), longer queues, or busier stores (36%).

Many consumers facing supply chain issues such as out of stock or late delivery say they don't hesitate to make changes. Over a third, 37%, say they would look to other retailers to meet their needs, or if they were in-store shoppers, they would switch to online shopping. Nearly a third, 29%, of online shoppers say they will let in-store retailer better serve their needs, and 40% will use comparison sites to check availability.

Global uncertainty and supply chain issues are also causing many consumers to pay more attention to their home markets. Eight out of ten respondents expressed their willingness to pay above average prices for locally or domestically produced products.

Pandemic-related consumer habits solidify

Consumers have changed their lifestyle and shopping habits as a result of the COVID-19 pandemic. it appears that many of these habits have become ingrained and will continue to grow over the next six months.

Due to the pandemic, 63% of consumers surveyed said they had already increased their online shopping, while 42% had decreased their in-store purchases. Half of the respondents cooked more at home, and 50% began to engage in home recreation and leisure more often:

● 50% expect to shop more online. This is the highest among Millennials (58%) and Generation Z (57%). But it is lower among Baby Boomers (32%) and Generation X (42%).

● 46% plan to cook more at home.

● 41% will spend more time for recreation and leisure at home.

● 41% will buy more from retailers that provide efficient delivery/collection services.

● 22% will shop less in physical stores; only 33% will increase the number of purchases in the store.