Where consumers say they’ll cut spending as prices rise

Even if restaurants succeed in staffing back up to pre-COVID levels, they may have trouble finding headcount of a different sort: Diners. A new survey, Numerator Quick Pulse: Inflation & Consumer Expectations, asked consumers where and how they'd cut spending as prices rise. Nearly 70% said they'd cut back on out-of-home dining (including fast food). And prices are rising. The Bureau of Labor Statistics this week reported that consumer prices rose 5.4% "for the 12 months ending July, the same increase as the period ending June." Second on the list of consumers' cutbacks was out-of-home entertainment, where 57% of those surveyed said they'd spend less on movies, concerts and amusements. Rounding out the top five categories for which consumers said they'd spend less: holiday gifts (52%), holiday celebrations (46%) and travel (44%). Grocery or household essential categories consumers say they're likely to cut If prices keep going up, sweets are out and vegetables are in. Option % of responses Desserts, candy 54% Prepared foods, deli items 47% Premium or organic items 46% Soda, juices 45% Alcohol (wine, beer, spirits) 31% Sustainable, environmentally friendly items 23% Meat, poultry, seafood 23% Fresh produce 18% None 14% Other, please specify 0% Other categories consumers say they're likely to cut Staying in is in if prices in general continue to rise. Option % of responses Out of home dining (restaurants, fast food) 69% Out of home entertainment (movies, concerts, amusement parks) 57% Holiday gifts (Christmas, Hanukkah, etc.) 52% Upcoming holiday celebrations (Labor Day, Halloween, Christmas) 46% Travel (gas, hotels, airline tickets) 44% In-home entertainment (streaming services, hobbies, etc.) 23% Back-to-school supplies 19% None 12% Results are based on a Numerator Instant Survey that was fielded to 200 panelists from Numerator’s consumer purchase panel on Aug. 9, 2021. Instant Surveys are short surveys with immediate turnaround to produce fast, directional insights. Plans to hoard don't appear to be on the horizon. Asked what they'd stock up on in anticipation of rising prices, 44% responded that they have no immediate plans to stock up. Another 44% said they'd stock up on household goods and 30% said they'd stock up on groceries including produce, frozen foods and snacks. Numerator also asked consumers if in the past month they'd noticed changes in the package size of commonly purchased household goods and groceries; 42% said yes. But when asked what they expect marketers to do as their costs go up, 75% responded that they expect prices to increase and 58% said they expect a change in package sizes. Consumers are aware of price increases. More than 70% noticed an uptick in grocery prices, 64% noticed the increase in gas and automotive costs and 62% said they'd noticed household goods price increases. Much smaller percentages of those surveyed said they were going to cut back on alcohol (31%), sustainable (environmentally-friendly) products (23%), animal (meat, poultry, seafood) proteins (23%) and fresh produce (18%), according to the Numerator survey. "With budgets tightening alongside rising prices, only a third of consumers said they would cut back on alcohol—instead, they're sacrificing their sweet tooth and premium items," said Kealind Trent, Numerator analyst. Results are based on a Numerator Instant Survey fielded to 200 panelists from Numerator’s consumer purchase panel on Aug. 9, 2021. "Alcohol is not going anywhere," said Ken Harris, managing partner at Cadent Consulting Group. "In-home consumption has increased," he added. Some consumers are still not completely comfortable in a bar setting, given the persistence of COVID-19 and variants. But sales in categories such as brown spirits and mezcal had been increasing, and neither the coronavirus nor cost increases have slowed that down. Fetch Rewards and Cadent Consulting Group's CPG Clarity Study also found that with more people staying home, animal proteins and at-home baking products continue to do well even as prices rise and COVID-19 persists. The trends were identified in September 2020 and continue in the current environment. Subscribe to Ad Age’s Datacenter for ongoing data and insights on all of the most-advertised brands.

Where consumers say they’ll cut spending as prices rise

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