When pressed for cash, Americans cut back, postpone and trade down
The Ipsos Consumer Tracker, fielded on Ipsos' Omnibus platform, asks Americans questions about culture, the economy and the forces that shape our lives. Here's one thing we learned this week.
Why we asked about cost consciousness: Gas prices are actually dropping at the moment for reasons that are murky, but perhaps related to post-Memorial-Day demand fall-off. But lately if it’s not one thing like gas prices, it’s something else spiking: energy, meat, food generally…
So what do we do when that happens?
What we found: Gas prices are bouncy at the moment. One expert had this super helpful and non-obvious hot take: "It's so volatile," Patrick Penfield, a professor of supply chain practice at Syracuse University, told ABC News. "If the war ended, prices would likely go down. But if it continues, you'll see prices go up." This question builds on a previous discussion we’ve had about the zero-sum economy and impacts it has. The talk track for that centered on bucketing behaviors. So we reframed the question to match, and the talk track still holds.
Keep in mind that 41% of Americans (including about three in ten in high-income households) say they have no money left over each month once they pay their bills. So when something like gas prices goes up:
First, we cut back on the non-essentials, like dining out. Then, we postpone larger expenses and trade-down to less expensive brands. We then cut (or churn) recuring expenses and subscriptions and start looking at price tags to get a sense of cost-per-unit vs. total cost. With gas specifically, we also try to reduce driving.
Strikingly, only one in five overall (18%, total, 24% of higher income folks) say their budget is flexible enough not to make cutbacks of any kind.
More insights from this wave of the Ipsos Consumer Tracker:
There’s no consensus on Americans’ use of AI at work
Amidst economic concern, U.S. consumers reshape food shopping habits
Younger Americans care more about brand, but not all categories are made the same
The Ipsos Care-o-Meter: What does America know about vs. what does America care about?
