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Consumers look to brands for transparency as cost of living soars: Mintel
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Friday, 23 September, 2022, 08 : 00 AM [IST]
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Our Bureau, Mumbai
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The dual impact of the pandemic and soaring inflation fueling the cost of living has led Indian consumers to pay closer attention to their spending. The latest whitepaper from global market intelligence firm Mintel reveals that Indians are seeking ways to save money on food and drink and are rethinking the importance of beauty products. The changes in consumer behaviours are evident as 42% of Indians state that they tend to stick to a budget as much as possible while shopping.
While the pandemic remains one of the primary concerns among Indians (46%), supply chain disruptions caused by the conflict in Eastern Europe also weigh heavily on consumer spending as prices of basic commodities increase. Four in 10 (41%) consumers state that the situation in Ukraine will have a direct impact on their household finances.
Saptarshi Banerjee, senior lifestyle research analyst, Mintel Reports India, said: “In the face of financial and health-related uncertainty, consumers feel vulnerable and want brands to give them greater decision-making control by being more authentic and transparent. Customer loyalty and trust are being put to the test as 36% of Indian grocery shoppers have switched to lower-priced alternatives while another 34% plan to switch from their usual brands to save money. Given that two in five consumers (42%) indicate that they would remain loyal to brands that are transparent on price increases, this will become a pressing priority for companies.”
Transparency in labelling extends to consumers’ food and drink purchases. For instance, checking product labels (49%), researching brands (42%), and tracking product/sourcing origins (36%) are some of the activities consumers are engaged in.
Natural, as well as ethical/environmental, claims in food and drink product launches in India are also rising. These two claims saw an average growth of 35% and 24%, respectively, over a five-year period between July 2017 to June 2022, according to Mintel Global New Products Database (GNPD).
With increasing consumer engagement in sustainability practices, the environmental impacts of food and beauty packaging are on their minds. Nearly half (43%) of consumers strongly feel that packaging waste needs to be reduced urgently, and 34% agree that it is hard to tell which products have the most environmental packaging. Another 36% of Indians think that there is very little information available on how to reduce packaging waste.7
“Sustainability is closely linked to packaging and brands can create initiatives for consumers to actively participate in, and contribute towards, sustainability practices. Our research shows that given the choice of similar food products, 44% of consumers will opt for the one that is labelled as ‘environmentally friendly’.
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