A recent survey in the US revealed that 65% of respondents were looking to increase their purchases of discounted products, with half of them having an annual income of $200,000 USD or more. Despite years of high inflation, geopolitical turmoil, and recession in some countries, the US economy has remained resilient, largely due to the strong consumption sector that contributes to 70% of GDP.
However, there are signs that Americans are starting to reduce their spending, which is concerning for economists. Bank of America CEO Brian Moynihan noted that customer behavior is changing, with people signaling caution by cutting back on spending. A survey by KPMG also reflected this trend, showing that while people are optimistic about their personal finances, they are worried about the US economy and plan to purchase more discounted products.
Consumers, regardless of income level, are increasingly looking to buy cheaper items to save money. This trend emerged during the pandemic and has resurfaced in recent times, driven by challenges in meeting essential expenses amidst rising inflation. As a result, retailers are lowering prices to meet the demand for affordable products.
The shift towards purchasing discounted products is evident across different income brackets, with even high-income customers opting for cheaper options. Retailers like Walmart and Dollar Tree have reported an increase in high-income customers shopping at their stores. The trend is expected to continue as consumers seek to stretch their income amidst economic uncertainty and inflation.
In response to the changing consumer behavior, retailers are offering discounts and promotions to attract customers. From Amazon to Target and Walmart, companies are slashing prices on thousands of products to help consumers save money. This trend reflects the current economic climate where consumers are looking to make their dollars go further in the face of rising prices and stagnant wages.
Overall, the trend towards buying discounted products among consumers, regardless of income level, is a reflection of the current economic challenges facing Americans. As inflation continues to impact daily expenses, consumers are looking for ways to save money and make their income stretch further in uncertain times. Retailers are responding by lowering prices and offering discounts to meet the changing demands of consumers in an increasingly challenging economic environment.