Market intelligence firm Mintel, in a report released today, says that Indian consumers are now looking for ways to save money on food and drinks and are reprioritizing their consumption, which includes reduced spending and rethinking the importance of beauty products.
“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,” says the report. In a poll conducted in March 22 on 1,000 internet users aged 18+, the report found that 42% of Indians affirming that their shopping expeditions have been limited by their budgets.
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 said that the situation in Ukraine will have a direct impact on their household finances, according to Mintel’s Ukraine Conflict Tracker data, May 2022, on 500 internet users aged 18+.
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,” said Saptarshi Banerjee, Senior Lifestyle Research Analyst, Mintel Reports India, citing poll results of 994 internet users aged 18+ who purchased groceries in the last three months running up to January 2022.
The report says that when it comes to beauty shopping, Indian consumers are taking extra steps to find the best deal. “Over one-third (38%) of Indians compare prices at different retailers before buying beauty or grooming products that they haven’t used before. Meanwhile, discounts/promotions (53%) and free samples (39%) are key drivers for consumers to shop for beauty products online.”
According to the report, in addition to price increases, consumers are looking to brands to be transparent in ingredient sourcing and supply chain practices. “In the beauty space, 34% of Indian consumers believe that beauty brands must be honest about their business practices. The ingredients that go into beauty products are also dominant considerations for cautious consumers, with nearly half (47%) strongly agreeing that researching the safety of ingredients is important. Five in 10 consumers (53%) are also willing to pay more for a clean beauty product that is proven safe on skin/hair.”
“The 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 that consumers are engaged in,” the report reveals.