Research: High-Income Consumers Cutting Back on Food Spending, Too
One-third of shoppers identify as "very nervous" about the economy and are taking actions, including cutting down on restaurant visits, to cut their expenses.
-- Restaurants & Institutions, November 24, 2009
[PRESS RELEASE] CHICAGO--(BUSINESS WIRE)--A recent HealthFocus International (HFI) study reveals that cutting costs has expanded into higher income groups; namely, those with annual incomes upwards of $75,000. A significant source of cost cutting is happening at the grocery store, as nearly three-quarters of shoppers indicate a higher level of concern about the cost of groceries, which has resulted in them buying less overall and cutting back on non-essential food and beverage items.
This study is a follow-up from the HFI report in April 2009 on Grocery Buying in the Current Economy and surveyed 1,000 primary grocery shoppers to explore how shoppers with income reduction (versus unemployment or loss of income) are dealing with recent change brought on from the economy. Reduction of income is affecting one out of three shoppers and is likely the key factor in bringing cost into play as a more permanent factor in determining behavior. These most recent findings reveal a significant shift in shopper actions and attitudes.
“The extended economic uncertainty has had a very profound and deepening impact on consumer attitudes and behavior,” says Barbara Katz, president of HealthFocus International. “The resulting practice of shoppers using cost cutting strategies could have a lingering impact, irrespective of whether or not economic conditions improve.”
Shopping Patterns Changing Among High Income Shoppers
Among individuals who earn more than $75,000, nearly three-quarters of this group’s food and beverage shopping patterns have been impacted to a significant degree. They are more aggressive than six months ago in their commitment to managing costs in the following categories:
* Almost half cut coupons more for grocery shopping, up from 15%
* Almost half spend less on entertainment, up 12%
* 40% buy private label or store brands more often
Cost Cutting Continues
While concern about the economy overall may have shifted down slightly from six months ago (80% vs. 90%), almost three-quarters of shoppers have a higher level of concern about the cost of groceries. Additionally, one-third of shoppers identify as “very nervous” about the economy and are taking action to manage down expenses including:
* Buying grocery items on sale -- Over half of shoppers are now buying grocery items on sale. Shopping on sale has increased in almost all groups studied and over half the shoppers in almost every group are buying on sale more
* Eating out less at fast-food restaurants -- Almost 60% of shoppers reported eating out at fast-food restaurants less
* Eating out less at sit-down restaurants -- four out of five are eating out at sit-down restaurants less, up 11%
* Cutting coupons more -- almost 60% claim they are cutting coupons more, up 12%
* Cutting down on groceries -- over half (54%) are cutting down on the quantity of groceries purchased to save money, up from 42%
* Eating less/fewer meals -- almost a quarter (22%) of them are actually trying to eat less food or fewer meals up from 11%
* Buying fewer non-essential items -- Items that shoppers may see as “luxuries,” like Convenience, Desserts, Snacks, and Candy are the categories where more shoppers are cutting back. The top 10 items that shoppers attitudinally consider to be some of the most expendable to save money include:
1. Fast Foods
2. Pizza Delivery
3. Sodas
4. Grocery Store Prepared Meals/Items
5. Cookies
6. Beef
7. Ice Cream
8. Chocolate
9. Frozen Snacks
10. Other Desserts
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