Confidence falls and inflation fears rise in latest IGD shoppers’ survey

By Éilis Cronin in Industry News 8th October 2021

Shoppers’ confidence has fallen to its lowest level for a year, according to the latest index from the Institute of Grocery Distribution (IGD).

The September index highlights that fears about food price inflation are at their highest since March 2013, with 85% of shoppers now expecting prices to rise in the next year, against 79% in August.

Overall financial confidence has also fallen sharply in the last month with 31% of shoppers expecting to be worse off in the year ahead (a 9% increase versus August 2021). Confidence has declined across all shopper demographics, but more so among lower income households.

Highlights from this month’s index include:

Financial confidence across lower income households continues to decrease with 42% expecting to be worse off in the year ahead compared to 26% in August. Confidence amongst higher income households also decreased with 30% expecting to be worse off in the year vs 22% in Aug’21.
21% of shoppers expect to focus more on saving money rather than quality next year (a 6% increase on August 2021).
Shopper confidence is declining across all regions, particularly in the Midlands where the score is 13 points lower than last month.
Shoppers aged 35+ are becoming less confident than those aged 18-34. In the last month confidence has declined from 0 to -12 among 35-44 year olds.

Simon Wainwright, director of global insight at the IGD, said: “This month’s Shopper Confidence Index is a sobering read and we anticipate it will be a similar story next month, following the steady decline we’ve seen throughout September.

“Moving forward shopper focus will be on value for money and we will see much wider adoption of the 2021 ‘Savvy shopping’ trend as shoppers look to save money, with many switching to private label products, motivated by seeking out savings.

“The discount channel is forecast to be the fastest-growing grocery channel over the next five years and we will see many shoppers shift their shopping behaviour to make cost-savings from this channel.

“Shopper confidence will remain very fragile for the foreseeable future so retailers and suppliers will need to focus on building loyalty by supporting their customers’ needs by offering value for money.”