12.13.21
Consumers on average will stop buying a product of any kind when its original price has risen by an average of 40%, a new survey commissioned by PR agency Ingredient Communications and conducted by SurveyGoo concluded.
According to responses from 1,000 U.S. and U.K. consumers, price changes in the food are especially of concern, with 94% of participants reporting that they’ve noticed their food shopping bills going up in the previous 3 months. 79% of those consumers said that they believed supply chain issues, such as driver shortages, were to blame.
On a scale which used five-percentage increments, consumers were instructed to select the point at which they would stop buying a certain type of food, beverage, or nutrition product due to price rises, while also giving the option of buying an item at any price.
Consumers tended to be less concerned with low-cost staple goods, such as milk which could increase by 65% before the average consumer would stop buying it. This was followed by bread (62%) and fresh vegetables (60%).
These consumers were particularly sensitive when it came to nutraceuticals, however. Respondents said they’d stop buying protein powder once the price rose by 17% on average, and the cutoffs were also relatively low for probiotics (23%), dietary supplements on the whole (26%) and omega-3 fish oil supplements (28%).
Consumers are highly willing to offset costs by shopping for alternative products once one branded product becomes too expensive. In the past three months, 48% of respondents switched to a cheaper brand due to price increases, while 26% switched to a retailer’s own-label version of a product for the same reason.
“For basic goods, even a large percentage price increase might still only be a matter of cents or pennies. By contrast, a small percentage increase in the cost of a premium nutrition product might be measured in dollars or pounds,” Richard Clarke, managing director of Ingredient Communications, said. “In such challenging market conditions, brands will need to work hard to retain consumer loyalty. An effective way to achieve this is to demonstrate added value by using high-quality ingredients that provide clear differentiation and command high levels of trust, whether that’s through proven efficacy, sustainability, strong-co-branding, or a combination of these. These values, communicated effectively, will tie a consumer to a brand more closely, mitigating the impact of price increases on purchasing behavior.”
According to responses from 1,000 U.S. and U.K. consumers, price changes in the food are especially of concern, with 94% of participants reporting that they’ve noticed their food shopping bills going up in the previous 3 months. 79% of those consumers said that they believed supply chain issues, such as driver shortages, were to blame.
On a scale which used five-percentage increments, consumers were instructed to select the point at which they would stop buying a certain type of food, beverage, or nutrition product due to price rises, while also giving the option of buying an item at any price.
Consumers tended to be less concerned with low-cost staple goods, such as milk which could increase by 65% before the average consumer would stop buying it. This was followed by bread (62%) and fresh vegetables (60%).
These consumers were particularly sensitive when it came to nutraceuticals, however. Respondents said they’d stop buying protein powder once the price rose by 17% on average, and the cutoffs were also relatively low for probiotics (23%), dietary supplements on the whole (26%) and omega-3 fish oil supplements (28%).
Consumers are highly willing to offset costs by shopping for alternative products once one branded product becomes too expensive. In the past three months, 48% of respondents switched to a cheaper brand due to price increases, while 26% switched to a retailer’s own-label version of a product for the same reason.
“For basic goods, even a large percentage price increase might still only be a matter of cents or pennies. By contrast, a small percentage increase in the cost of a premium nutrition product might be measured in dollars or pounds,” Richard Clarke, managing director of Ingredient Communications, said. “In such challenging market conditions, brands will need to work hard to retain consumer loyalty. An effective way to achieve this is to demonstrate added value by using high-quality ingredients that provide clear differentiation and command high levels of trust, whether that’s through proven efficacy, sustainability, strong-co-branding, or a combination of these. These values, communicated effectively, will tie a consumer to a brand more closely, mitigating the impact of price increases on purchasing behavior.”
