Inflation’s Impact on Consumer Spending Is Still High, but May Be Easing

March 24, 2023

Inflation has been causing consumers to change their spending habits and marketers to adapt their strategies. As inflation rates moderate, though, consumers are becoming slightly less likely to say that their spending has been affected, according to recent data [download page] from Jungle Scout.

In Q1 2023, 8 in 10 adults surveyed by Jungle Scout said that rising inflation had affected their spending. While a high figure, it represents the second consecutive quarter of slight declines, down from 83% in Q4 2022 and 84% in Q3 2022. And although the Q1 figure is higher than the year-earlier period (72% in Q1 2022), it’s possible that inflation-affected spending peaked in the latter part of 2022 (although that remains to be seen).

The top categories that consumers said they are cutting back on during Q1 are dining out at restaurants/bars (55%), fun/impulse purchases (48%), in-person entertainment (42%) and leisure travel (40%). Interestingly, although data has shown a willingness for consumers to cut back on their subscriptions, fewer respondents said they’re pulling back their spending on subscription services (28%) than on any other area.

Meanwhile, the top money-saving strategy for consumers in Q1 is to buy items on sale, as reported by a majority (53%) of respondents. Previous research has shown this to also be the leading way in which consumers have responded to inflation. Other money-saving strategies employed by consumers in Q1 include the use of coupons/discount codes (43%), buying less expensive brands (42%) and buying generic or “no name” brands (39%).

Separately, Amazon (56%) – a key source of shopping inspiration for Millennials – continues to be cited by the largest proportion of respondents as a place to start their search when shopping for a product online, though that figure was down from the year-earlier period (63%). Search engines are next, though they were also cited by fewer respondents this quarter (42%, down from 46% in Q1 2022). By comparison, more point to Walmart.com as a place to start their search (37%, up from 31%), and TikTok also is on the ascent (19%, up from 14%).

Finally, one-third of consumers reported having purchased something pre-owned online in the past year, with the most common items being bought pre-owned online being Books, Clothing, and Electronics.

For more, download the report here.

About the Data: The results are based on a February survey of 1,000 US adults (18+).

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