Data shows consumers reducing spending and turning towards second sources of income in the face of rising prices
Digital River, a global commerce enabler directly connecting brands and buyers, released findings from its most recent consumer survey aimed at helping brands understand shifting consumer shopping habits tied to current and future economic concerns. The survey data was collected from 3,000 total respondents equally spread across the US, UK, and Germany.
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“Amid global economic concerns, consumers are demonstrating cautious optimism about their financial outlook, signaling a shift towards greater cost-consciousness and strategic savings”
Global economic worries persist, yet consumers are less concerned about personal finances compared to previous years.
Despite facing heightened financial strain, a significant portion of consumers anticipate a brighter financial future ahead, with hopes for improvement over the next year.
- Over half (55%) of consumers are concerned about the current state of their country’s economy, with 54% feeling more stressed about their personal finances.
- Over the last 12 months, 24% of consumers say their financial situation has gotten better, while 42% say it has gotten worse.
- Yet compared to 2022, consumers are generally more optimistic about the future of their financial situation. In fact, two in five respondents expect their financial situation to improve over the next 12 months.
Consumers have changed spending habits to cope with uncertainty.
While some resort to ‘doom spending’ to cope, many consumers are scaling back spending across the board, trying to control budget variance.
- Over the last 6 months, half (51%) of consumers have been spending less due to concerns about the economy and geopolitical events.
- Nearly one-quarter (23%) of consumers describe their current habits as “routine spending,” with consistent and predictable patterns prioritizing necessities.
- One in five (22%) consumers describe their current spending habits as “budget-conscious spending,” meaning they carefully plan and track expenses.
- Gen Z consumers (22%) were more likely to admit to “doom spending” than other generations (Millennials: 19%, Gen X: 11%, and Boomers + Silent Gen: 9%).
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Shoppers are divided on their approach to savings.
Many consumers have pursued side hustles to add to their savings or plan to in the future, with rising costs underscoring the need for emergency funds.
- One-quarter (24%) of consumers have taken on an additional job or “side hustle” to increase their income in the last 12 months. Another one-third (32%) plan to do so in the future.
- About one-third (30%) admit to “doom saving,” reporting the top reasons for increasing savings are contributions to emergency funds (52%) and affording the rising cost of necessities like food and rent (33%).
- German consumers were particularly focused on increasing their emergency savings (62%), compared to the US (41%) and UK (48%).
“Amid global economic concerns, consumers are demonstrating cautious optimism about their financial outlook, signaling a shift towards greater cost-consciousness and strategic savings,” said Ted Rogers, Digital River’s Chief Marketing Officer. “While facing the pressure of rising prices, the trend of decreased spending and increased savings underscores a prudent approach to navigating economic uncertainty, with encouraging signs of price stabilization in certain markets.”
