AMC Global Writes About Inflation for Total Retail

Posted by AMC Global on Apr 6, 2023 12:20:00 PM

AMC Global's Emily Trentacosta recently was published in Total Retail magazine, with her article "Inflated Prices, Deflated Consumers: The Impact of Price Increases on Shopper Behavior." In the article, Emily shares findings from a recent wave of our ongoing consumer behavior study, "Impact of Price Increases on Consumer Behavior."

In the article, Emily discusses inflationary pressures coming from many angles in many industries. Retailers are among the businesses feeling the pinch, as rising costs of goods and shipping are forcing them to raise prices. Price increases can have a profound impact on consumer behavior. In some cases, consumers may simply accept the higher prices and continue to purchase the same products. However, in other cases, they may change their behavior in significant ways. In the article, Emily shares some of these ways:

  • Switching to cheaper alternatives: When prices rise, consumers may look for cheaper alternatives or substitute products that offer better value for money. This could mean switching to lower-priced brands or products, or buying in bulk to take advantage of discounts.

  • Delaying purchases: Consumers may delay making purchases when prices rise, especially for non-essential items. They may wait for sales or promotions, or postpone their purchases until they have more disposable income.

  • Reducing frequency of purchases: Consumers may also reduce the frequency of their purchases when prices rise. For example, they may buy fewer items or visit the store less frequently.

  • Cutting back on spending: In extreme cases, consumers may cut back on overall spending when prices rise. They may prioritize essential items and reduce spending on non-essential items such as entertainment, travel, or luxury goods.

The Total Retail article also covers ways to mitigate the impact of price increases on consumer behavior:

  • Communicate effectively: Retailers should communicate price increases clearly and transparently to their customers, explaining the reasons for the increase and any steps they are taking to mitigate the impact.

  • Offer value for money: Retailers should focus on offering value for money, by providing quality products, competitive prices, and a good customer experience.

  • Provide alternatives: Retailers should provide alternatives to their customers, such as lower-priced products or discounts on bulk purchases.

  • Build loyalty: Retailers should focus on building customer loyalty by providing excellent customer service, personalized experiences, and rewards programs.

  • Monitor competition: Retailers should monitor their competitors' pricing strategies and adjust their own prices accordingly to remain competitive.
Read the article in Total Retail magazine, with her article "Inflated Prices, Deflated Consumers: The Impact of Price Increases on Shopper Behavior" to learn more how price increases can have a significant impact on consumer behavior, and how retailers can mitigate this impact by communicating effectively, offering value for money, providing alternatives, building loyalty, and monitoring the competition. By doing so, they can maintain customer satisfaction and loyalty, even in challenging economic conditions. Using the right market research approaches to understand how to take these steps is key. Reach out to us to learn more!