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IRI MarketPulse Survey Finds Festive Yet Frugal Holiday Celebrations Are on the Menu for Consumers This Year

Shopper Sentiment Dips Again in Q3 2015 and Dampens Spending on Holiday Celebrations

CHICAGO – Nov. 17, 2015 – Shopper sentiment took another hit in Q3 2015, marking the second consecutive quarter for a sharp decline in confidence, according to the latest IRI MarketPulse™ survey. Consumers are feeling the pinch due to strained personal finances, stagnant wages, and rising health care and education costs, which will be impacting upcoming holiday celebrations. In fact, the IRI Point of View, “Holiday 2015: Making a List and Checking It Twice,” takes a closer look into the hearts and minds of this year’s holiday shoppers and finds that 32 percent of consumers are planning to spend less on holiday celebrations this year. In addition, the accompanying infographic Frugality Is on the Holiday Menu highlights exactly what shoppers will be putting on their tables.

“We’re taking a deep dive into those four crucial weeks following Thanksgiving that span Hanukkah and Christmas to determine how merry the holidays will be for CPG retailers this year,” says Susan Viamari, vice president, Thought Leadership, IRI. “Unfortunately, it’s shaping up to be a rather lackluster season. Still, marketers must keep in mind that two-thirds of U.S. consumers say they want to prepare the best meals possible. The trick to capturing maximum share of wallet this season will be to target consumers carefully and get on the all-important shopping list.”  
IRI Shopper Sentiment Index Takes Sharp Decline in Q3 2015 Among All Age Groups
Constructed against a benchmark of Q1 2011, IRI’s Shopper Sentiment Index provides deep insight into how the economy is impacting consumers and changing how they approach grocery shopping. The index provides perspective in terms of price sensitivity, brand loyalty and changes in spending required to maintain desired lifestyles. With a benchmark score of 100, a Shopper Sentiment Index score of more than 100 reflects consumers who are less price driven, more loyal to favorite brands and better equipped to maintain their desired lifestyles without changes, as compared to Q1 2011.

The index dropped to 119 in Q3 2015, versus 123 in Q2. It’s also lower than it was one year ago, when it came in at 121, leading up to the 2014 holiday season. Sentiment is down across all age groups, with millennials indexing at 103. While this is still a low index compared with the index as a whole, it is higher than it was in 2011, 2012 and 2013, and also up from Q3 2014, when millennials indexed 95. However, millennials still index well below that of older shoppers, with those ages 35-54 indexing 123 and those ages 55-plus coming in at 122 in Q3 2015.

Younger shoppers are still feeling the pinch a bit more than their older counterparts, though. Slightly more than half (51 percent) of 18- to 34-year-olds made numerous cutbacks during the past six months, compared with 37 percent of those ages 55-plus.

Simplicity Is the New Sophistication This Holiday Season
Consumers are heading into the holiday season with a conservative mindset. While they still want to make a splash with holiday celebrations, 32 percent expect to spend less this year than they did in 2014. Overall, this adds up to relatively flat sales for the upcoming CPG holiday season. To make the most of opportunities this season, it’s important for marketers to reach consumers before they head out the door, because pre-planning and deal seeking will play a major role in their money-saving efforts:

  • 62 percent will prepare a list at home before heading out to the store
  • 54 percent will clip coupons from newspapers/circulars
  • 34 percent will rely on private label solutions
  • 29 percent will redeem credit card/store points for product savings

Sunnier Outlook for 2016
Even though consumers are currently feeling a bit strapped, they are optimistic about 2016. Overall, 29 percent of 18- to 34-year-olds expect the economy to improve during the next six months, compared with 21 percent of those ages 55-plus. While all age groups feel that these improvements will boost their financial health, millennials are showing solid optimism in this area. More than half (57 percent of 18- to 34-year-olds) expect their financial health will be better one year from now, compared with 37 percent of 35- to 54-year-olds and 21 percent of those ages 55-plus.

“It’s fantastic to see millennials so optimistic about the future, since they struggled the most throughout the economic downturn,” adds Viamari. “If these optimistic expectations come to fruition, it will go a long way in encouraging younger consumers to open their wallets more. They will be able to spend more on what they want, not just what they need. And millennials will finally feel more comfortable about making those impulse buys and even splurging now and again.”

IRI Point of View
To dig deeper into spending trends for holiday celebrations, IRI just released a new Point of View, “Holiday 2015: Making a List and Checking It Twice.” To download the free report, visit: http://www.iriworldwide.com/en-US/insights/Publications/Holiday-2015-Making-a-List-and-Checking-It-Twice.

About IRI’s MarketPulse Survey
IRI provides new survey results at the end of each calendar quarter covering shoppers’ behaviors and attitudes as they directly relate to their strategies for learning about, purchasing and utilizing CPG and healthcare products, as well as information regarding perceptions of economic conditions and their ability to provide for their families. For complete MarketPulse coverage, visit: http://www.iriworldwide.com/en-US/insights/MarketPulse. For more information about customizing the research for a particular category or industry, please contact IRIMarketing@IRIworldwide.com.

About the IRI Partner Ecosystem
IRI fundamentally believes that delivering differentiated growth for clients requires deep, highly integrated partnering with a variety of best-of-breed companies. As such, IRI works closely with a broad range of industry leaders to create innovative joint solutions, services and access to capabilities to help its clients more effectively compete in their various markets and exceed their growth objectives. IRI is committed to its partnership philosophy and continues to actively enhance its ecosystem of partners through alliances, joint ventures, acquisitions and affiliations. The IRI Partner Ecosystem includes such companies as BlueKai (an Oracle company), The Boston Consulting Group, comScoreDatalogix (an Oracle company), Experian, GfK, GuestMetrics, Ipsos, Kantar, MasterCard AdvisorsMaxPoint, Millward Brown Digital, Mu Sigma, Oracle Social Cloud, RentrakSPINSUnivision and others.

About IRI
IRI is a leading provider of big data, predictive analytics and forward-looking insights that help CPG, OTC health care organizations, retailers and media companies to grow their businesses. With the largest repository of purchase, media, social, causal and loyalty data, all integrated on an on-demand cloud-based technology platform, IRI helps to guide its more than 5,000 clients around the world in their quests to remain relentlessly relevant, capture market share, connect with consumers and deliver market-leading growth. A confluence of major external events—a revolution in consumer buying, big data coming into its own, advanced analytics and automated consumer activation—is leading to a seismic shift in drivers of success in all industries. Ensure your business can leverage data at www.iriworldwide.com.
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