94% of Irish consumers say the recent price increases have impacted their purchasing affordability.
Irish consumers fundamentally changing their shopping habits, PwC Ireland’s latest Consumer Insights Survey reveals.
With the cost of living now top of people’s minds 94% of Irish consumers say the recent price increases have impacted their purchasing affordability and 32% expect their spending to fall in the next six months.
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Despite higher prices, spending on a number of categories is still set to increase over the next six months. Many Irish consumers are happy to pay a higher price for local produce. In-store shopping remains key to the Irish consumer. More Irish consumers will shop locally in the next six months compared to global counterparts.
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Cost of living concerns
More than a third (36%) of Irish consumers say that recent price increases are impacting their purchasing affordability to ‘a great extent’.
A further 58% say this affordability is impacted to ‘some extent’. 35% of respondents confirmed that they are working in a hybrid way while 57% are required to be physically located at their workplace. Nearly a third (32%) of Irish consumers expect their spending on products and services to fall in the next six months; 44% expect this to remain the same while 25% expect it to increase.
Due to the pandemic, 69% of consumers surveyed said they have increased their shopping online (Global: 63%). Over half (57%) increased their buying from retailers local to them (Global: 36%). 41% are buying across a variety of retailers (Global: 33%).
“Just as consumers continue to change their shopping behaviours and preferences, actively searching for the best shopping experience and choice, retailers and manufacturers must move quickly to meet shifting demand and their own inflation and supply chain pressures,” said John Dillon, leader at PwC Ireland’s Retail & Consumer Practice.
“We don’t see these pressures easing anytime soon. Agile businesses that can manage through multiple disruptions while keeping their focus on the demands of their customers are in the best position to succeed in this tumultuous environment.”
With around 50% of Irish respondents identifying issues with stock availability in the last six months, it is clear that global supply chain issues are having a direct impact on the Irish market. Many confirm that they are taking action to address these issues. Over four out of ten (43%) say they are shopping at different retailers to meet their needs (Global: 37%). 31% are using comparison websites to check product availability (Global:40%). Nearly a third (29%) of online shoppers say they are switching to in-store to better meet their needs (Global: 29%). If they are in-store shoppers, over one in five (22%) are switching to online (Global: 38%).
Geopolitical uncertainties and supply chain issues are also leading many consumers to shop locally. Over three quarters (76%) of Irish consumers expressed a willingness to pay a higher than average price for products produced locally or domestically (Global: 80%).
Irish consumers are decisive in their spending decisions despite higher inflation. Notably, 55% expect to spend more on groceries in the next six months; 52% expect to spend more on travel and 45% expect to spend more in restaurants and bars. However, perhaps a sign of what is to come, more than a quarter of consumers plan to reduce spending in a number of categories, including luxury/premium goods (37%), takeaway food (33%), virtual/online activities (31%) and fashion (26%).