Findings from a recent report on inflation commissioned by Nielsen’s NCSolutions (NCS), a purchase-based ad targeting and measurement firm serving the CPG industry, found that nearly half of Americans (45%) feel like they can't afford their previous lifestyle and 76% of American consumers say their family has changed how they buy food with prices on the rise.
NCS' "Food-Flation — The Rising Costs of CPG" report includes findings from a consumer sentiment survey and the company’s proprietary purchase data, which reflects the buying trends of consumers for CPG products and shows an almost 13% price increase on average.
Takeaways from NCS’ report include:
Six in 10 Americans believe CPG product packaging has gotten smaller but costs the same, compared to one year ago. Consumers still feel the strain of supply chain issues as 69% said there are fewer items of the same product on the shelves.
Over half (53%) of U.S. consumers said they find basic food staples more expensive; 40% believe a recession will occur in 2023. Seventy-one percent of Americans said the increased price of groceries is straining their savings. Others (45%) said increased prices in the grocery aisles mean seeking out less expensive brands.
Other ways consumers are coping with the increased price of groceries are loading up the pantry (27%) or freezer (26%) or shopping closer to home (24%).
When it comes to consumers' preferred brands, 60% percent of consumers are seeking less expensive alternatives when their favorite brands reach a price beyond their budget. Forty-six percent of consumers plan to go without their favorite brands, and 43% look for sales to offset the cost.
"For the second time in a little over two years, consumers are pivoting to new purchasing behaviors at the grocery store," commented Alan Miles, CEO, NCSolutions, in a news release on the survey results. "Since the start of the pandemic, they've been swapping their favorite brands for what's available. Today, though, value is the centerpiece more often than availability, consumers are selecting brands and products to stretch their budgets as far as possible. CPG brands that meet customers where they are both in this inflationary moment and as prices ease have the best shot at keeping them for the long-term."
Miles also said in the report that, families will pay more for the upcoming fall and winter CPG holidays and milestones. “As an advertiser in this environment, it is key to be in front of your buyers, reminding them why they love your brand,” he said.
The consumer sentiment survey obtained 2,141 respondents and was fielded from June 17-20. Responses were weighted by location, education, income and other demographics to be representative of the overall population, per the report. The company also leveraged its own purchase insights to calculate the increase in prices for CPG categories and published them in the guide. (View more findings in the graphics below.)