Half of Aussies are switching to cheaper brands
Almost half of Aussies are switching to cheaper brands as cost of living hurts wallets, according to new research revealed in Dentsu's retail evolution report releeased today.
The report, which is an evolution of 2022’s Future of Retail report, reviews the events of 2022 and the future implications for retail success and innovation in 2023 and beyond. Findings in the report are drawn from dentsu’s DISCUS survey, an online survey speaking with 1,600 Australians each month. The research reveals after a strong 2022 in retail, 2023 has been challenged by consumers’ reaction to the rising cost of living, higher housing costs and mortgage payments.
More than half of Aussies surveyed (56%) are moderately to extremely concerned about their current financial situation, while 71% are moderately to extremely concerned about the strength of the Australian economy at this point, with women showing higher levels of concern about the local economy.
It is against this backdrop that retailers are also responding to four critical trends that will shape the industry for years to come:
Pragmatic Sustainability: In 2023 sustainable actions will be a lifestyle choice but also an economic necessity.
- Subtle Tech: Retailers are turning to technology to future proof their business, cut costs, and deliver better CX. However, moving forward it is important to find the right balance between human and automated experiences. Technology should be useful, convenient, and unobtrusive.
- Battle of Titans (for the customer, their data & the media): Titan brands continue their battle for consumers, their data and the media in their never-ending quest for growth and diversification.
- Seeking a human touch: Consumers are returning to IRL retail post pandemic. Savvy retailers are offering them sensorial experiences and a preview of the store of the future.
Christine McKinnon, head of dentsu Intelligence, said: “The retail industry has faced some of the biggest challenges of any industry in the past few years with COVID-19 forcing many brands to pivot to an online strategy, to now needing to embrace a more hybrid model as customers’ expectations for a superb online and physical shopping experience become table stakes.
“This research is designed to help retailers, marketers and brands associated with the retail industry better navigate how emerging tech, changing consumer expectations and the push for more sustainable options will shape the industry in the next decade, against a backdrop of an unpredictable economic landscape.”
The full report can be downloaded here.