According to the latest Shopper Confidence Index from IGD, shopper confidence remains strong and financial confidence has reached a new high.
ShopperVista from IGD, provides category, insight and commercial professionals with trusted daily shopper insights. Its unique measure of shopper sentiment has this month revealed that confidence remains stable. One component of the index – financial confidence – has reached a recent high of +3, which is the first time people are expecting to be better off than worse off in the year ahead, since 2013. However, this confidence continues to remain polarised across income groups.
May 2021 results
Shopper confidence remains strong, decreasing by just one point to -2 from the five year high of -1 in April 2021, driven by the further easing of restrictions, the continued rollout of the vaccination programme and record temperatures over the second bank holiday weekend.
One of the main drivers of this overall positivity is shopper confidence about individual financial positions; just 19% expect to be worse off in the year ahead, which is the lowest level recorded*.
Shopper confidence decreased by just one point to -2, following the five year high in April 2021.
Financial confidence has reached an all time high*. Just 19% expect to be worse of in the year ahead compared to 23% in April 2021.
Higher income households believe they will be better off (25%) rather than worse off (17%). In contrast, lower income households believe they will be worse off (23%) than better off (20%).
Younger and older shoppers are less concerned about their financial futures (only 13% of 18-24 year-olds and 16% of over 65 year olds are pessimistic about the future).
Despite dropping from +9% to +5%, the focus on quality remains high, compared to -2 in May 2020.
London and the South were the only two regions to show improved shopper confidence. Scotland and the North saw the greatest decline in confidence.
Simon Wainwright, Director of Global Insight at IGD, said: “The continuation of boosted shopper confidence offers a reassuring outlook for retailers, suppliers and operators. Overall, shopper confidence is likely to remain positive over the summer as the economy opens up further, more people receive the vaccine and the threat of COVID-19 recedes.
“This elevated confidence creates an opportunity for retailers to focus on engagement with customers to drive additional and unplanned purchases. That said, saving money will continue to remain a priority for some shoppers, so it’s important to explore value strategies to meet the needs and motivations of different shoppers. Now is a good time to build on foundations to create long term trust and loyalty.
“Whilst confidence is still fragile, the polarisation between income groups has reduced slightly this month, further supporting the indicated positive outlook. However, it’s important to be mindful that things could change quickly. Shoppers are highly aware of the changing situation and bad news could cause a reversal in confidence. Factors such as inflation will also begin to impact shopper budgets and consequent behaviours.”
The full IGD Shopper Confidence Index is available to subscribers on IGD ShopperVista.