Consumer behaviour is never consistent. What they want and like and what they’re willing to spend their money on is constantly changing in response to economic, social and demographic factors. On a small scale, these changes represent just individual preferences, but on a larger scale, they are purchasing patterns that influence the success of your brand.
Hence, it becomes paramount for businesses to stay agile and adapt to these evolving trends of consumer behaviour to stay ahead of the competition and build strong relationships with customers. This year, the trends are showing an emphasis on financial restraint as well as cost savings, with many customers allocating their budgets toward essentials in a context where inflation and housing expenses remain a significant concern.
Consumers are becoming more budget-conscious
Due to the current cost-of-living crisis, many people are changing their shopping habits, adopting methods that enable them to track spending more accurately. Economic uncertainty has caused them to streamline their budgets and rethink how they spend their money. Consumers are increasingly keeping an eye on exciting discounts such as those from Loungefly online store for Europe, and doing their best to stay in control and safeguard their financial details as well. Consumer sentiment has dropped, particularly among lower—and middle-income households, with people choosing to prioritize non discretionary expenses and savings.
This isn’t to say that consumers aren’t buying things anymore – they are; however, the items must be worth spending money on. For businesses, this means that they need to solve the problems customers have – preferably, as many as possible with just one product or service- and then focus on telling consumers how the product or service can transform their lives.
Inflation is influencing spending habits
Although inflation has cooled from record highs, its levels are still above those before the pandemic hit, with 33% of people worldwide citing inflation as a major issue in their country. With prices on the rise, the entire spectrum of consumer goods is inevitably impacted; farmers are also reporting more significant operating costs, which influence supermarket costs.
These price rises put increasing pressure on household budgets, further impacting purchasing decisions and causing consumers to adopt different strategies to save money, such as using coupons or shopping online or closer to home. To stay on top of this trend, retailers need to find ways to mitigate inflation’s impacts by improving their supply chains and offering promotions to customers to help maintain loyalty.
Value-driven shopping is gaining momentum
As economic pressures increase, consumers are shifting towards value-driven shopping, which prioritizes essentials, and enables them to save without compromising on quality. There’s heightened caution especially among middle- and lower-income households, who feel the financial strain of high living costs. Besides shopping at value stores and seeking value brands, consumers are also drawn to trials, bundles, special offers, payment plans, and more.
Consumers also seek brands that provide affordability and quality, and above all, many households consider price to be the top factor in their buying decisions. Businesses can navigate these changes by differentiating, innovating, and nurturing retailer-manufacturer collaborations.
Personalization remains key to building customer loyalty
E-commerce personalization has been a hot topic for a while, and it still is. Personalization efforts are associated with conversion rate uplifts around 2%- 5% on average, and it has also been demonstrated to increase loyalty in 68% of consumers. Essentially, personalization means using unique customer data to show them content based on their browsing history, previous purchases, device, and other factors.
Nowadays, there’s no need to try and guess what products and messages customers will find attractive – there’s a better way, namely, using first-party data that allows you to identify your target audience. Simply put, first-party data comprises any information shared by a customer with a company, including their shopping preferences and habits, so that they can get a better shopping experience in exchange. The truth is that customers love personalization, and they wouldn’t hesitate to share their data as long as you let them know this will be beneficial for them -and that their information will remain safe.
The demand for health and wellness products is on the rise
Another notable trend is customers’ shift towards health and wellness, especially when it comes to diet. According to the data, 52% of consumers are looking to boost their intake of fresh veggies and fruits, and 22% are planning to decrease their red meat consumption, showing an increased awareness of environmental and health considerations.
The data also shows a disconnect between environmental impacts and people’s intentions, as only around 19% of consumers consider their food choices’ ecological effects. For companies, this can be an opportunity to bridge the gap by merging wellness offerings with sustainable practices, attracting customers who are increasingly conscious of their personal health and their actions’ impact on the environment.
Social commerce is thriving on TikTok
While Instagram and Facebook have led the social commerce movement for a while, TikTok is catching up quickly. According to the data, the social commerce industry in the UK is projected to more than double in the following years, rising to nearly £16 billion by 2028. This means social commerce makes up 10% of the overall online commerce market. Over half of UK consumers have bought something via social media, either by checking out within an app, or through a link on shoppable content. This increased to around 73% for people under 45, with 24% of millennials buying on social media platforms at least once a month.
People have been using TikTok to discover, research and review products, but the platform is now starting to be a part of their shopping journey, with 44% users already having made a purchase directly on it. This growth in social commerce is driven by the increase in community commerce, where engagement, community, and shopping merge together on social platforms, driving engagement and purchasing before and after the checkout process. More straightforward social integrations with ecommerce and the growing uptake of shoppable formats like interactive ads and live shopping are also contributing to the growth of the social commerce market.
Final thoughts
Understanding customer trends for 2025 is the first step in ensuring your business stays relevant this year and beyond. Now that you know how customers’ behaviour is changing, it’s time to take action and make sure your offerings meet their needs and preferences. So, will you embrace these changes and meet customers where they are in their journey?
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