September saw a slight drop in shopper confidence as tighter restrictions and uncertainty over the EU exit led the news agenda, according to the latestIGD Shopper Confidence Index.
Overall confidence slipped to -8 on average for the month, down from -7 in August. At the beginning of September shopper confidence started at -6 but fell to -10 by the end of the month.
Remaining at a relatively low level, confidence appears to have been suppressed by news of increased Covid-19 cases and further national restrictions – notably, the rule of six, working from home where possible, and the 10pm curfew for pubs and restaurants.
A third (32 per cent) of shoppers expect to be worse off financially in the year ahead, up from 30 per cent in August.
With news of little progress in trade talks between the UK and EU, 18 per cent of shoppers expect food prices to get much higher in the year ahead, the highest level since September 2019.
Simon Wainwright, director of global insight at IGD, said:“Shopper confidence is likely to remain fragile as the Job Retention Scheme comes to an end to be replaced by the Job Support Scheme, alongside shoppers contending with further uncertainties concerning Covid-19 and whether there is a deal or no-deal with the EU. This will no doubt lead to an increase in savvy shopping tactics over the coming months.
“With so much uncertainty at the moment, we anticipate shoppers’ confidence will respond to key announcements and media reports on Covid-19 and the EU.”
Confidence has declined the most among 18-24-year-olds and 35-44-year-olds. With announcements of redundancies, particularly impacting younger people, 38 per cent of people in the 18-24 age bracket expect to focus more on saving money on their food and groceries in the year ahead (vs 24 per cent last month). This compares to 21 per cent of all shoppers.
With local lockdowns coming into force, confidence has declined significantly, particularly in the West Midlands (-11 in September vs -6 in August) and in Wales (-11 vs -4). These two regions now have the lowest shopper confidence.
Despite these worrying figures, Wainwright reassured the the food and grocery industry that consumer positivity towards it “remains high”.
“The continued actions that have been taken by retailers and manufacturers across the country to support those in need have increased this trust,” he said.
“Indeed, trust in the food industry to ensure good availability has remained high (78 per cent) despite recent increased levels of stockpiling.”
The full IGD Shopper Confidence Index is available to subscribers onIGD ShopperVista.
