How Do Shoppers Respond To Inflation This Holiday Season In 2022?

Alarming as it is, 2022 is a regime of market volatility and higher macroeconomic risks. What does this mean? The gap between supply and demand is rising, which translates to higher prices at stores.

The cost of living will inevitably increase, and shoppers will face a difficult choice – to buy now or wait for better deals. For marketers, this is a great challenge and a wonderful chance to increase sales and make extra money.

To help you understand this shift, let us go beyond the macroeconomic numbers and see how shoppers will respond to inflation this holiday season.

What is the impact of rising prices? 

Let’s look at the Philippines’ Consumer Expectation Survey, which shows that shoppers have had positive energy during the first quarter of the year with an index of  -15.1% compared to 24% from the past three months.

But this eventually declined during the succeeding quarters. This meant that shoppers started to feel different energy toward the country’s economic future and considered their spending habits.

To translate this data, the numbers indicate that the number of shoppers will continue to set back their purchases due to their concern about the country’s economic future. Thus, we will see shoppers adjust their budgets to save in case prices rise. 

Clearly, consumer expectation keeps on changing as supply chain issues, inflation or worse, a possible recession, heavily affects competition, availability and values. 

Consumers today are aware that this is happening. 

However, this scenario makes a great opportunity for eCommerce shops and brands to step in and change shoppers’ mindsets. 

How can marketers take advantage of this situation?

Marketers and brands must understand how shoppers make purchase decisions during times of inflation. So, how can brands make e-shopping more appealing to shoppers during an inflationary period?

Here are some of the tips that you can use to entice shoppers and make them become customers: 

1. Lean on a customer-centric approach

The first thing you need to earn shoppers’ trust is a customer-centric approach. Customer-centricity is the purposeful use of resources to benefit customers to make them happy and loyal before and after the sale, resulting from repeating purchases. It goes beyond good customer service. 

Amazon proactively strives to maximize customers’ total purchase cost with their Prime membership. In addition, it has helped them initiate repeat sales from existing customers by offering additional features and benefits that shoppers might not have thought of.

Problems that can be resolved with Amazon’s customer service include claims of an item not received or damaged or a claim that the customer never received the item they purchased. 

Rather than turn a blind eye, Amazon is actively moderating posts and responding with information to help customers get through their troubles. When a problem arises, it takes only one minute to contact customer service using the ‘Contact Us’ page.

It might be high time for you to check whether you are utilizing a customer-centric approach.

> Do you have support who are fully equipped to address customer issues?

> Do your functional silos allow customer data sharing?

> Do you focus more on your customers than your sales?

> Are you able to provide real-time feedback to your customers’ needs?

2. Create a seamless omnichannel experience

The term omnichannel refers to a digital consumer lifecycle that includes multiple channels and modes of interaction between consumers and your brand. Nowadays, there are so many ways our information is passed along; it’s like we are connected in a way that it’s nearly impossible to be disconnected.

Technological advancements have brought us one step closer to omnichannel. It’s now not just online or offline, but we are also connected in many other ways. For instance, we can share information through social media, instant messaging apps, and the like. 

According to Lauren Shayman of Forbes: “An omnichannel consumer is really a consumer who has a variety of touchpoints and channels with your brand. They access a number of different areas and products in the purchasing journey with your brand.” 

To cater to your customers who are shopping online and offline, you must have a seamless experience for them. For example, a shopper can start their purchasing process through an app, then order for collection in your store, and pay for the item by checking out on the app.

3. Create an emotional experience for shoppers

A study by Bain & Company revealed that consumers are now comfortable with making payments by using mobile payment systems such as Apple Pay or Android Pay.

Since this technology is not just convenient but also secure, it helps consumers to make purchases that they would normally not do in offline stores, accept payments using their phones and have the transaction happen right there in the store. 

This technology also presents a unique opportunity for retailers to create an emotional experience with their customers regarding the purchasing process and payment. Adding value like free delivery or gift can make consumers feel more comfortable about making payments.

How?

Digital payments are still a relatively new concept, but with their increased acceptance among consumers and retailers, there’s a good chance that we could see them become more widespread.

In this increasingly digital world, we see that e-commerce could be the way to go in the Philippines. It is safe to say that e-commerce will continue to grow as consumers are now adopting mobile payments and with the rise of customer-centricity.

Final Thoughts

Retailers offering omnichannel experiences can capitalize on this strategy when it comes to marketing efforts and allow shoppers to purchase goods and services conveniently. 

It’s not just about tapping into the millennial consumer base but also serving customers of any age and demographics. Moreover, it helps brands create an emotional connection with the consumer by giving them a seamless experience within their e-commerce site.