IRI reports uncertainty among consumers through beginning of 2017

CHICAGO — In the wake of a mixed economy, the unknown of a new kind of presidency and a complex retail marketplace, U.S. consumers began 2017 with a lot of change and uncertainty. According to the latest IRI Consumer Connect survey released Tuesday, these factors contributed to 2017 getting off to a shaky start with consumers.

"January and February are generally softer months for the consumer packaged goods industry, but showed sharper-than-normal declines this year,” stated Susan Viamari, VP thought leadership for IRI. “[As many as] 45% of consumers say their household finances are strained, with lower-income and younger shoppers being hit the hardest," she said. "Consumers across the board have been avidly seeking deals and, while deal-seeking will remain pervasive, the good news is that economic expectations for the remainder of the year are positive."

Results from the Q1 2017 IRI Consumer Connect survey reveal that consumers are struggling, especially millennials, who have student loans and have experienced economic instability for most of their professional careers.

For instance, 33% of millennial households are having difficulty affording needed groceries, compared with 26% of generation X, 33% of baby boomers and 21% of seniors. Because millennials have entered adulthood in a tough environment, though, this group really does not feel more putout than older generations: 55% of millennial households are making sacrifices to make ends meet, compared with 53% of generation X, 54% of baby boomers and 39% of seniors.

To combat this uncertainty and stretch dollars, 89% of millennials are buying private label brands, IRI noted, as compared with 81% of the total population.

CPG consumers are showing a willingness to pay a premium, however, particularly for items that really hit the mark. For example, 48% of consumers will spend more on OTC medications that treat multiple symptoms. And 39% will trade up for foods and beverages that provide additional nutritional benefits, such as added vitamins and antioxidants.

“This year got off to a rocky start for the CPG industry, but things are starting to look brighter,” concluded Viamari. “Our same message for marketers is ringing true yet again. Know your customers inside and out and tailor your offerings to meet their needs. By personalizing your products and messaging, you will hit the right note with consumers, encouraging them to open their wallets in support of your brands.”

 

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