Around 89% of shoppers now expect food prices to rise in the next year as shopper confidence “plummeted” in January to the lowest levels recorded by the Shopper Confidence Index, according to the Institute of Grocery Distribution (IGD).
In addition, the Index revealed financial confidence reached its lowest level since 2013 – excluding the initial 2020 lockdown period – with 39% stating they expected to be worse off in January 2022 vs 31% in December 2021.
The latest data highlighted the average shopper index score for the month of January as -14, down from -9 in December – the lowest it has been at any point in IGD’s data.
Despite the lifting of Covid 19 restrictions, shopper confidence dropped in the first week of January to -11, and by the end of the month, it had fallen to -17.
“The removal of COVID-19 restrictions this month did nothing to improve shopper confidence due to cost-of-living concerns, and there is still space for it to decline further given the full effect of rising prices is yet to be felt,” IGD ShopperVista head of shopper insight Rhian Thomas said.
“We continue to believe that rising food and energy bills will hit the lowest affluence groups hardest, with ‘heating vs. eating’ becoming a genuine concern for the lowest earners.
“From our data, we’re seeing shoppers indicate they’re spending more than they want to and buying less as a result.
“Going forward, businesses should prepare for shoppers being more planned in their shopping – eating more at home and looking to spend less day-to-day to save money and spend on what matters to them.”
The news comes after the Deloitte Consumer Tracker showed that rising utility and grocery bills in the last quarter of 2021 led to consumer confidence falling as they started to feel the squeeze of soaring inflation rates.