Consumer Spending Confidence Drops in Past Six Months: Optimove Consumer Research

Consumers’ planned budgets for shopping have dropped slightly over the six-month period according to the results of two surveys, each of more than 450 US consumers, fielded in August 2022 and February 2023. In August, 19% of respondents expected to budget more shopping through the end of 2022. In February, it had fallen to 14% of consumers who felt they would budget more than the previous year as they looked forward to 2023. In both August and February, more than 80% of consumers expect to budget the same or less for shopping. Optimove conducted the surveys.

In February, 54% of Optimove survey respondents also said they had less confidence in the economy for 2023. Twenty-one percent (21%) had more confidence, and 25% had the same confidence. The data was in line with consumer confidence reported by The Conference Board, which showed that consumer expectations after months of decline in the summer of 2022, rose in August. In February 2023 consumer confidence declined from previous months. The February Index is at 102.9, compared to 103.2 in August.

Related is low U.S. unemployment at 3.4% at the end of January. In addition, the U.S. inflation index has been high since 2021. In 2021, it was at 7%, declined to 6.5% in 2022, and is projected at 6.4% in 2023. Before 2021, inflation was held in check at around 1-2% since 2013.

According to Pini Yakuel, CEO of Optimove, “The job market is strong, but consumers are getting mixed signals of low unemployment and high inflation. Uncertainty in the economic numbers creates uncertainty in consumer spending. For retailers, it means that current customers are critical to driving incremental sales and profits. To do so, brands must create deeper personal relationships based on the information customers provide. Every piece of data is a clue on how each customer wants to interact with the brand. It is incumbent upon the retailer to read the clues for better consumer connections.”