US consumers are noticing higher prices when they shop, and they’re not feeling too optimistic about their financial future—but they haven’t stopped spending. That’s good news for consumer-packaged-goods (CPG) manufacturers. Still, consumers are making spending decisions differently now than they did in the past, and CPG companies need to understand—or, even better, anticipate—these changes. This video explores four themes that CPG companies would do well to keep in mind as they navigate the uncertainty in today’s US market.
Watch the video to learn more about:
- the “trading down” trend—and what that looks like depending on category, channel, and segment
- the recent rise in private labels’ market share, after a two-year period of stagnation that began with the COVID-19 crisis
- retail channels that are continuing to grow in spite of inflation
- differences among demographic groups when it comes to spending and sentiment—for example, high-income millennials are showing the strongest net intent for future spending
In light of these trends, it’s more critical than ever for CPG companies to develop a deep understanding of consumer segments, refine the value propositions of their brands and products, and invest in innovation. For more on US consumer sentiment and behavior, see “The Great Uncertainty: US consumer confidence and behavior during inflationary times” and read (or listen to) the following episodes from the McKinsey on Consumer and Retail podcast: “Taking the pulse of the US consumer” and “Understanding the ever-evolving, always-surprising consumer.”