By Susan Viamari
After several consecutive quarters of cloudy skies and a particularly ominous end to 2013, IRI’s Q1 2014 MarketPulse™ finds all age groups, especially millennials, reporting a sunnier outlook. Consumers reported feeling that they do not need to make as many sacrifices to make ends meet, and are feeling more confident in their household finances overall.
This quarter, millennials showed their greatest increase in shopper sentiment since the beginning of the economic downturn. For more insights into the significance and causes of millennials’ promising perspective, see our latest Point of View, “Millennial Shoppers: Positive Mindset Points to Future Growth.”
Despite the surge in consumer confidence, CPG retailers and manufacturers must be wary that conservative shopping strategies are engrained in consumers. This quarter’s MarketPulse survey revealed that consumers across categories have become accustomed to the shopping strategies necessitated by harder economic times. For example, 70 percent of consumers still make a shopping list prior store visits, and 75 percent make their purchase decisions prior to stepping foot on the premises.
Furthermore, 19 percent of consumers and 26 percent of millennials are still having difficulty affording groceries. To stretch their dollars, thirty-three percent of all consumers and 40 percent of millennials are buying more than one-half of their baskets on deal.
To accommodate the consumers’ ongoing appreciation of deals and propensity for planning purchases, CPG retailers and manufacturers would do well to begin the conversation early with consumers. One approach to achieving early customer engagement with millennials is online programs, such as recipe sharing or product usage routine contests, that help to establish an emotional connection and facilitate consumers’ habit for planned purchases. Tying those online programs with in-store sampling kiosks will continue the conversation and reinforce the value proposition.
While there is no single path to recovery, marketing strategies must account for the consumers’ desire to live well and spend conservatively. Additionally, CPG retailers and manufacturers should continue to drive momentum through new and innovative offerings.