How US shoppers are reacting to inflation

Consumers in the US are dividing into “convenience shoppers”, “bargain shoppers” and “part-time bargain hunters” as they respond to the challenge of inflation, a study has found.

That was the one insight from a survey by Scalefast, an e-commerce solutions provider, of 1,130 adults, described as household decision-makers, to understand how they are responding to the growth in the cost of living.

Why it matters

As inflation bites, many consumers are likely to adapt their behaviours as rising prices take a toll on household budgets. Segmenting customers into distinct groups based on their needs and emerging habits could thus be a useful approach in response.

The three groups

• “Bargain shoppers” are a cohort that makes over 40% of their purchases on-sale. They comprised 33% of the panel. An interesting knowledge point about this audience was that they were 40% more likely than the average shopper to “value loyalty points to earn savings.”
• “Convenience shoppers”: Some 37% of respondents fell into this category, members of which directed less than 40% of their purchases to items that are on-sale. When compared with “bargain shoppers”, fully 55% of this segment were less likely to gamble on an item going out of stock in the hope of getting a better price. They were also 84% more likely to say “if I want it I buy it” when discussing seasonal items like clothing and accessories.
• “Part-time bargain hunters” sit in the middle of the other two cohorts in terms of their behavior.

Exclusivity matters

• A sense of exclusivity still matters, as approximately 20% of shoppers would pay full price if they were “one of the only people to have an item.”
• People who pay full price for goods when in brick-and-mortar stores but are bargain shoppers online are 32% more likely to be motivated by the same consideration.
• This group was also 12% more motivated to be among the first people to own an item.

What constitutes a “good deal”

• The average consumer regarded a 32% markdown in pricing as the minimum reduction necessary to feel like they are securing a “good deal”.
• For “full-price convenience shoppers”, that figure stood at a more modest 28%.
• When it comes to “final sale” items, convenience shoppers said a 43% price cut was an acceptable price cut if returns policies were going to be restricted.
• Bargain shoppers placed that total at a significantly higher 55%.

Sourced from Forbes