According to a recent survey conducted by PwC, global consumers are expected to decrease their spending on fashion in the coming months. This shift is driven by the ongoing cost-of-living crisis and concerns about personal financial situations. The survey revealed that 50% of respondents expressed extreme or very high levels of concern about their financial well-being.
The survey, which gathered responses from over 9,000 participants, found that over half of the respondents (53%) are choosing to hold back on purchasing non-essential items. In fact, 15% of consumers have completely eliminated their non-essential spending. This marks a significant decline compared to the previous survey conducted in June.
The survey also highlighted the categories in which consumers plan to reduce their spending in the next six months. Luxury/premium or designer products are expected to see the most significant decrease in demand, with 53% of respondents planning to cut back. Additionally, travel (43%), virtual online activities (42%), and fashion (41%) were identified as areas that will experience reduced consumer expenditure.
Despite the reduction in spending, consumers expressed a willingness to pay more for sustainable products. Approximately 8% of respondents indicated a willingness to pay extra for locally produced or sourced products, while a staggering 77% favored products made from recycled, sustainable, or eco-friendly materials. Furthermore, 75% preferred products from companies known for their ethical practices. However, it remains to be seen whether these preferences will lead to increased sales, as consumers are currently focused on seeking discounts.
The survey results also provided insights into the different concerns and behaviors among different generations. Generation X was found to be the most concerned (47%) about their financial situation and have actively taken measures to reduce non-essential spending. Baby Boomers displayed some concerns (33%) and showed a willingness to adjust their spending habits. However, Millennials, despite expressing concerns, did not significantly alter their behavior.
In addition to pricing concerns, consumers also highlighted supply chain issues that are impacting their shopping experiences. Around 30% of respondents reported encountering longer queues and busier store locations, leading to reduced product availability. This issue was particularly prominent in Australia (36%), the US (35%), and India (34%). Supply chain challenges were also apparent in online shopping, with rising prices (48%), product availability (24%), and unexpectedly long delivery times (24%) being the top concerns.
Furthermore, the survey revealed that consumers are increasingly concerned about data privacy, particularly with the rise of online shopping. Almost half (47%) of respondents expressed extreme or high levels of concern when interacting with social media companies, third-party/portal travel websites (36%), healthcare providers (34%), and consumer companies (32%). These privacy concerns may have implications for the adoption of the Metaverse as a shopping platform. Currently, only 26% of respondents indicated using the Metaverse for entertainment, virtual experiences, or product purchases in 2022.
In conclusion, the PwC survey highlights the intention of global consumers to reduce fashion spending and cut back on luxury and non-essential purchases in the coming months. However, consumers continue to prioritize sustainability and are willing to pay more for environmentally friendly products. The survey also emphasizes the importance of pricing and supply chain operations, as retailers need to offer better value and address logistical challenges. Additionally, data privacy concerns and a cautious approach to sharing personal information may impact the adoption of emerging shopping platforms like the Metaverse. Understanding and adapting to consumer preferences and behaviors will be essential for fashion and retail industry players navigating the ever-changing economic landscape.
Useful Links:
1. The Guardian: Sustainable Fashion May Not be as Sustainable as You Think
2. Vogue Business: Fixing Fashion Doesn’t Work – Our New Book
