Consumer Mindset Report - October 22
Informed by the Credit Union Consumer Sentiment Index, in partnership with Core Research, as well as Core’s Cultural Index, this research report reveals 2022 Q4 Consumer Behaviours
A Plaster or a Plan?
The Credit Union Consumer Sentiment Index, in partnership with Core Research, improved slightly in October. It recovered some of the 11.3-point decline seen in August. The range of measures announced in Budget ’23 has helped somewhat to offset the cost-of-living pressures for some people, but it remains to be seen if the one-off measures announced will be enough to protect households from an expensive winter and year ahead.
Almost two thirds of people felt that Budget’23 made no difference or made their situation worse. You could almost hear the collective exhale in society “it’s grand.” But it is not enough. People continue to ask, “What’s the Plan?” There is a lack of direction and an uneasiness about what else might be around the corner. Will the responsibility to reduce inflation be left to households to manage their own budgets?
Uncharted Territory + Lack of Control = Stress
Stress is now the most experienced emotion among adults in Ireland. This is having a direct impact on peoples’ expectations of the future. Only a quarter of adults are optimistic that we can overcome the cost-of-living crisis and the remaining three quarters are pessimistic or unsure if we can get through these economic challenges. This crisis is uncharted territory for us, we don’t know the rules and without the emotional and financial support we don’t really know how to behave.
Cutting back is the way forward
Cutting back is now a key feature in many households in Ireland. Only a minority claim that they have yet to adjust their spending or consumption behaviour and some claim they have exhausted all steps to cut spending.
Compared to the summer months, spending on socialising, eating out and holidays have been scrutinised . Over two thirds claim they would delay a big purchase. This month, more consumers tell us they plan to cut back on clothing, alcohol, groceries and energy costs.
How does this impact Christmas this year?
Christmas ’22 was labeled as the one where people should have the freedom to celebrate and enjoy it together with family and friends. But just 15% of people believe that Christmas this year will be better than last year.
COVID-19 restrictions will be replaced by household budget restrictions this Christmas. Two in five people plan to spend less and purchase less gifts this year. This means that it will be the third Christmas in a row where people do not have the full freedom to enjoy it.
Active Empathy is Needed
People in Ireland need both financial and emotional support to get us to through this. Brands have a role to play here to demonstrate and respond to the public’s concerns with practical solutions.
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