Rising inflation concerns continue, contributing to a further dip in shopper confidence, according to the latest Shopper Confidence Index from IGD.According to the July 2021 Shopper Confidence Index, from ShopperVista – which provides category, insight and commercial professionals with trusted shopper insights – 79% of shoppers expect food prices to get more expensive next year, compared to 75% in July’21.
The August Shopper Confidence Index also reveals a widening of the K-shaped economic recovery with 28% of higher affluence groups expecting to be better off in the year ahead, compared to 23% in July’21. Meanwhile lower affluence groups increasingly believe they will be worse off in the year ahead, with 26% believing this, compared to 23% in July.
August 2021 results
Shopper confidence has slipped back slightly to -4 in August, having declined for three of the last four months. However, it remains relatively high and is still at one of the highest levels in the last five years.
August saw dull weather and the further rise of the COVID-19 Delta variant. However, confidence may have been boosted by the reopening of much of the economy, more people taking holidays and the late summer Bank Holiday.
- Confidence among younger shoppers has increased for the first time since April 2021 with 37% of 18–44-year-olds expecting to be better off in the coming year
- Overall financial confidence remains relatively high with 24% expecting to be better off in the year ahead, up 3% compared to July’21
- Shopper confidence is declining in Scotland, registering -7 on the index compared to -2 in July’21, amid growing COVID cases and warnings that restrictions may have to be reimposed
Simon Wainwright, director of global insight at IGD, said: “The continued rise in inflation concerns are likely to lead to a sudden return to risk-aversion and more value-seeking behaviour, particularly among families who are hard-pressed financially.
“Retailers will need to pay close attention to the widening K-shaped recovery; lower affluent families will increasingly seek out value, so special offers, everyday low prices and visits to discount stores will become prominent.
“On the reverse, more affluent shoppers will continue to trade up and focus on quality due to increased disposable income created by pent-up savings.”