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Dive Brief:
Ongoing economic headwinds are pushing consumers to seek out value that goes beyond just low prices, according to a new survey report from Deloitte that tracked 900,000 data points across 290 consumer brands over three years.
While value and price can be linked, up to 40% of consumers say their perception of a brand’s value stems from factors other than price. The report found that brands that prioritize providing value to customers have higher purchase intent and are capturing more share.
Value-seeking consumers expect to spend 40% to 50% less this year on discretionary categories like clothing, personal care, home furnishings, household goods and entertainment while increasing their purchases of essentials, such as housing and transportation, per the report.
Dive Insight:
As inflation remains ever present and global tariffs loom, consumers are seeking products that offer value as much as a good price, Deloitte found.
A recent survey from UserTesting in March found that shoppers in the U.S., Australia and United Kingdom were willing to pay on average 25% more for their favorite brands.
“Consumers are more discerning than ever, weighing the value they receive with their purchases,” Mike Daher, vice chair and U.S. consumer industry leader at Deloitte, said in a statement. “And while low-income earners may look for value out of necessity, higher-income households increasingly put value at the top of their shopping lists.”
The research came out at a time when several brands — including Lululemon and Nike — have instituted mild price hikes due to the uncertainties around tariffs
“As economic uncertainty lingers, consumers across demographics actively seek brands that deliver value, whether through quality, trust, friendly attitudes, or a combination thereof,” Daher said. “No matter the industry sector, MVP brands that get pricing right and boost consumer perceptions of their value will be well positioned to attract consumers, increase their margins, and build long-term loyalty.”