Market research firm YouGov has investigated the impact the war in the Middle East will have on consumer behaviour. Unlike the crisis of 2022, which was triggered by disruptions to the flow of raw materials, the current crisis is simultaneously undermining the foundations of production for various goods. Energy use, agricultural yields and transport capacities are all being affected by the instability surrounding the Strait of Hormuz. According to YouGov, for consumers this does not mean general cutbacks, but rather a selective reorientation.
Consumers will assess how easily a product can be substituted and whether an item is perceived as ‘fairly priced’ amid rising cost pressures. The question for manufacturers and retailers is therefore not whether inflation will return, but which categories are structurally exposed to which cost factors – and how households typically respond to them.
Even those who have the financial means to cope with price rises are choosing to cut back. Although the full impact of the war has not yet been reflected in consumer prices, people are already cutting back to prepare for more expensive food and energy. In most European countries, between a third and half of those surveyed say they have adjusted their budget for food shopping. A large proportion of households that are not yet saving plan to do so in the near future. When it comes to staple foods such as dairy and cereal products, people tend not to cut back on quantity, although they are more likely to avoid premium brands in this category.
Energy-intensive product categories are structurally vulnerable when oil and gas prices rise. This is because the costs of processing, refrigeration, transport and packaging are rising rapidly. This is most evident in dairy products, frozen foods, chilled ready meals and beverages, where the pressure on margins is immediately felt.
Market researchers note that consumers are increasingly adopting a more methodical approach to crises. Many consumers have already developed a shopping strategy to tide them over difficult times, based on previous crises. They draw up strict shopping lists and wait for special offers to make bulk purchases. Furthermore, consumers are actively asking themselves whether products are worth their price. This does not mean that ‘unnecessary’ purchases are no longer being made. The ceaseless crises are leaving people emotionally exhausted, and experts therefore still see room for little treats in moments of comfort.
