Mark Ursell, CEO of QuMind
2023 is set to be an uncertain time for businesses across the country. Consumers have cut back on non-essential spending, and this is a concern for many businesses especially as they are still recovering from the effects of Covid-19. In order to navigate the rocky year ahead, it is essential that they understand what consumers are going to spend their reduced disposable income on.
So, what are the trends expected in 2023 and what can businesses take from these to encourage customers to spend their hard-earned cash with them?
More Bang for your Buck
A recent QuMind Sentiment Index (QSI) survey of the British public’s responses to the cost-of-living crisis showed that a staggering 43% said they are buying more deals and discounted items, as consumers try to keep ‘business as usual’ at a reduced cost. And, with the rise in the cost of bills and daily products seeing no signs of slowing down, it is crucial that businesses adapt to the needs of their customers and are quick off the mark in offering them deals to make the purchases even more attractive. Particularly for big purchases, like holidays, this will allow customers to plan as far ahead as possible in these uncertain times.
Saving on sustainability in the long-term
In 2023, the shift towards buying more quality items for less will not only be driven by more sustainability-minded consumers but to manage spending in the mid-to-longer term amid the cost-of-living crisis. Spending more upfront for reusable items or those with a longer shelf-life will help many individuals better manage their expenditure on many products, and ultimately save money – and businesses of all sizes must cater to this.
Thoughtful spending
Values-based purchasing decisions will extend from Gen-Z to all age demographics as customers increasingly want an affinity of ‘what I stand for’ and ‘what I believe in’ between a brand and their own values. Customer loyalty in this environment will only be achieved with a clear understanding of what their values are, and then showing that these values are shared by the brand.
The introduction of Gen Alpha
Gen Alpha – of whom the eldest turn 13 years old this year – will start to assume purchasing power in 2023. Businesses will have to start listening to this new customer segment to understand their wants and needs. This is the first generation where most of its members have been born into a high-tech world, so seamless digital customer experiences will be crucial. But questions remain over whether they will continue or shake off Gen-Z trends. Will they be as socially conscious as their predecessors? Will they want more physical experiences? All that can be safely assumed is that they won’t be like any generation that came before them, and all businesses need to prepare for that.
The resurgence of the High Street
Over the pandemic, the “death of the high street” was a headline frequently peddled across many mediums of media. However, 2022 saw a bumper year for shops as consumers flocked back instore. This year, the high street will continue to resurge as people look for physical connections and experiences, particularly given the QuMind Sentiment Index found consumers predict their spending on hospitality will fall. Businesses must build more physical touchpoints into their omnichannel experiences for consumers in the year ahead.
Adapting to Grow
Understanding current consumer spending trends is important for businesses, but it’s even more important that businesses understand what to do with them.
Remaining adaptable through changing market conditions that impact consumers’ spending habits allows a business of any size to stay relevant and reflect changing wants and needs. In this ever-changing world, it’s so very important to stay close to customers, anticipating and adapting to their needs to retain their custom in 2023, and beyond.
