Slide 1: Mid-Year Consumer Outlook: Guide to 2025
MID-YEAR CONSUMER OUTLOOK Assess the global state of consumers: What has changed, what disruptions remain, Guide to and what companies need to anticipate in the next 12 to 18 months ahead 2025 A U.S. Perspective
Slide 2: Welcome to Your 2025 Strategic Guide
Welcome From Cautious to Intentional Consumption to Your At the beginning of 2024, the US consumer outlook had improved slightly but the climate has shifted in the last six months. Despite continued easing of inflation, increasing 2025 economic pressures and the uncertainty of an election year are l
Slide 3: Executive Summary: Navigate the shift from cautious to intentional consumption
Guide to Navigate the shift from cautious to intentional consumption 2025 1 State of Consumers: Measuring resilience and 2025 spending growth Key Findings: Executive 2 Consumption Drivers: • Projected US inflation for 2024 and 2025 Summary As inflation shifts, will volume lift? stable at 2.0% • Howe
Slide 4: Table of Contents
Table of 1 State of Consumers 05 Contents: 2 Consumption Drivers 17 3 Financial Polarization 27 4 Redefining “Discount” 39 5 Trends to Watch 51 4
Slide 5: State of Consumers
1 State of Consumers Decoding the behavioral economics driving consumer decisioning The US outlook for consumers is worsening. Consumers are not optimistic despite improving economic factors and are vigilant against further disruption and intentional about every aspect of their everyday spending. So
Slide 6: U.S. positive outlook fell midyear despite Global improvement
U.S. positive outlook fell midyear despite Global improvement Consumers continue to feel the strain of Cost of Living, Economic Slowdown, and Job Insecurity Consumer financial position. Sentiment year over year (% respondents) U.S. 43% 21% VS 43% 40% say they’re 37% of US 33% 32% consumers say in a
Slide 7: Optimism around financial situation lags in North American and EU markets
Optimism around financial situation lags the most in North American and EU markets In the United States more consumers feel worse than better, similar to more pessimistic sentiments among consumers in the United Kingdom and Canada Where more consumers are “Better Off” than worse 38.4 33.7 27.7 Where
Slide 8: Top concerns setting the spending tone for 2025
Top concerns setting the spending tone for 2025 Biggest gainers were increasing utility bills, ability to provide basics, and immigration 1 Rising food prices 36% 6 Political unrest (was #5 in Jan. 2024) 13% 2 Increasing utilities bills (was #6 in Jan. 2024) 16% 7 Immigration (was #13 in Jan. 2024)
Slide 9: While food prices worry all, regional concerns differ
While food prices worry all, some unique regionality in concern for global conflict and housing costs North Americans most worried about rising housing costs, while global conflict is a top concern for Africa, Middle East, and Europe. Europe North America • Rising food prices • Increasing housing co
Slide 10: Steady global growth expected for 2024 and 2025
Steady global growth expected for 2024 and 2025, with the US as a top driver Global Total 3.1 3.2 Annual India 6.6 6.6 Indonesia 5.1 5.2 GDP growth China 4.9 4.5 Turkey 3.4 3.2 projections– Croatia 3.3 2.8 2024 vs. 2025: Poland 2.9 3.4 Romania 2.8 3.1 % growth, South Korea 2.6 2.2 United States 2.6
Slide 11: Inflation expected to continue to ease
Inflation expected to continue to ease U.S inflation rate is lower than the Global average and expected to remain flat Global Total 4.5 3.7 Inflation rate, Argentina 59.6 31.8 Turkey 38.4 22.4 average consumer Poland 5.0 3.6 price projections– South Africa 4.5 4.5 India 4.2 2025 vs. 2026 % 4.1 Rom a
Slide 12: The US remains the largest economy
The US remains the largest economy One to watch: India has risen to top 5 rank, forecasted to continue rising through 2027 India continues to rise Top 10 largest / richest economies in the world in importance Rank & GDP GDP Per Capita Rank & GDP GDP Per Capita Country USD Billion USD Thousand Countr
Slide 13: The US has had consistently lower inflation than the globe
The U.S has had consistently lower inflation than the globe except in the most recent month Pace of CPG inflation continues to slow across countries, with North America & Asia Pacific seeing lowest inflation % change in average CPG price, United States vs Global monthly Regional heat map of monthly
Slide 14: Price growth in the US has mostly stabilized
Price growth in the US has mostly stabilized in the past year, at similar levels to Spring 2021 10.0% 9.0% 8.0% U.S. Consumer Price Index growth rate 7.0% 6.0% 5.0% 4.0% 3.0% 3.0% 3.0% 2.0% 1.0% 0.0% Sou rce s: OECD Monthly Consumer Price Index ( CPI) Gro wth Ra te, Year over year, United States © 2
Slide 15: Consumption Drivers
2 Consumption Drivers As inflation shifts, will volume lift? Inflation has decelerated in many parts of the world. But the compounding effect of the past couple years will be felt for some time. As consumers are balancing many competing life priorities, they may be driven to consume less in some spe
Slide 16: US consumer still feeling the compounding effect of inflation
US consumer still feeling the compounding effect of inflation Purchasing power hasn’t yet fully recovered for most global consumers – though the US is not impacted much as Europe, Latin America, and Africa. Annual % increase (in USD) prices: United States $100 $115 $100 $119 $100 $115 United States
Slide 17: Global volume trend improves, while the US lags
Global volume trend improves, while the US lags North America outpaces Global trends with slightly increased volume Value sales growth % Volume growth % Africa +9.0% -2.0% Asia- Pacific +1.2% +0.4% Europe +6.9% +1.5% Global FMCG trend Latin +11.7% +3.5% 2024 vs. 2023 America Value sales +4.9% Volume
Slide 18: Rising prices are still plaguing several key departments
Rising prices are still plaguing several key departments Department inflation heat map: United States EQ volume price % change Total FMCG: +3% Frozen Food Conf. & Snacks Paper Products Baby Care +0.2% +5% > +5% +6.5% +1.4% +3% -+5% Ambient Home Health & < +3% Food Beverages Perishables Food Care Bea
Slide 19: Volume declines throughout the store
Volume declines throughout the store driven by non-essential categories & categories with biggest price increases Department volumetric heat map: United States EQ volume % change Total FMCG: -1.4% Frozen Food Conf. & Snacks Paper Products Baby Care -0.6% Growing -3.8% -1.6% +0.7% Declining less than
Slide 20: Local nuances to inflation and volumetric highs and lows
Local nuances to inflation and volumetric highs and lows For instance, Confectionary & Snacks leads volumetric growth in Asia Pacific region, but growth is inflation-driven in North America. Europe HIGHEST LOWEST Price % Confectionery & Snacks (+9.3%) Health Care (+3.2%) Europe growth Pet Food (+8.4
Slide 21: Financial Polarization
3 Financial Polarization Rising debt vs. unmatched wealth Consumer wealth is accumulating in divisive ways. At the same time where vulnerable households face rising fixed costs of living, some of the population have found further security and savings as their wealth grows. Anticipating consumer spen
Slide 22: The 2024 economic divide
The 2024 economic divide Financial insecurity among US consumers continues to climb in 2024 7% 7% 6% Thrivers Saved money and feel 15% 13% more financially secure. 23% Unchanged 19% Not impacted and continue to spend the same. 38% Cautious 38% Not impacted financially but are cautious with spending.
Slide 23: Divided job prospects
Divided job prospects Despite stability in employment rates, some high-earning job markets face pressure Despite employment gains overall, U.S. white-collar job growth slows Stable employment rate hides a tough white-collar job market Of over 303K jobs added in March 2024, ~7K came Unemployment rate
Slide 24: Many are seeking additional income streams
Many are seeking additional income streams In the US, people are less likely to take on additional revenue streams or increase personal debt to afford their current lifestyle than globally US Global 53 53% 64 say they’re likely to be actively seeking additional income streams beyond their primary jo
Slide 25: 2025 wallet intentions reinforce shift to purpose-driven spending
2025 wallet intentions reinforce the shift from a cautious to purpose-driven spending mindset Intentional consumers prioritize at-home, planned, and waste-avoidant spending. SPENDING SAME SPENDING LESS AS BEFORE MORE 56% 43% OOH dining / eating Utilities 39% 52% Groceries and 48% 34% 40% OOH enterta
Slide 26: Consumers still have fixed life costs to consider
Consumers still have “fixed” life costs to consider, so discretionary spending is still scrutinized Grocery / Household essentials–especially fresh produce–are top of mind. Spending intentions for the next 12 months Net change in spending (pt. change) Fresh produce 12.7 Utilities 26.4 Pet products 3
Slide 27: Redefining Discount
4 Redefining Discount Sizing how consumers are shopping to stay ahead The concept of “discount” has broadened and evolved over the past few years of socioeconomic disruption. Today, consumers of all financial circumstances are seeking value in multiple ways, with every purchase. From the marked rise
Slide 28: Consumers expect broader value from the concept of discount
Consumers have embraced (and expect) broader value from the concept of “discount” Affordability and price are the foundation, but purchase decisions are swayed by other manifestations of value. “Discount” means more “Discount” means more than just price than just price Affordable Affordable + + New
Slide 29: Product pricing tops list as a primary driver of consumer decisioning
Product pricing tops list as a primary driver of consumer decisioning And when asked about their value-seeking preferences, more consumers are likely to opt for Private Label or stop buying non-essentials altogether Top 10 consumer saving strategies for CPG / FMCG – United States Assortment can infl
Slide 30: North American CPG price tiers
Prices are stratifying, with highest and lowest pricing options are showing the greatest growth Sales share shift in percentage points vs. previous year 100% Super Premium 90% 19% +0.1 (Price index >130 ) North American CPG price tiers 80% 18% Premium 70% (Price index 110-130) -0.1 60% Mainstream 50
Slide 31: Promotional pressure intensifies as depth of discount rises
Promotional pressure intensifies as depth of discount rises, particularly in Food & Bev departments % of categories where depth of discount has increased vs. previous year Depth of discount increase by department: United States 69% 66% PET CARE 1.3% 57% 58% 49% 50% FROZEN 1.3% 40% 41% 42% BEVERAGES
Slide 32: Dollar has become the fastest-growing US channel
Dollar has become the fastest-growing US channel in the last year United States CPG channel performance % sales growth vs. previous year 6.0% Dollar 4.3% Military 9.4% 4.1% Club 8.6% 3.6% Mass 3.0% Ecom 6.0% 1.0% Conv 0.7% Food -2.3% Pet -2.7% Drug -17.4% Liquor Asia Pacific Europe United and China
Slide 33: Higher income households drive shift in spending towards Discount
Higher income households drive shift in spending towards Discount % $ growth vs previous year for US households Total Dollar Store 13% 14% 11% 8% 4% 4% Emerging opportunity 3% 2% 2% 2% for retailers: 0% Diversify assortment -0% -1% to meet shifting -1% consumer needs. Income Income Income Income Inc
Slide 34: Intentional consumers are willing to pay a premium for convenience
Intentional consumers are willing to pay a premium for convenience and life satisfaction US consumers are less likely than Global consumers to prioritize convenience say they’re likely to spend 53% a little extra to make one 53% moment or day of the week more special or 56% enjoyable say they’re lik
Slide 35: Private labels prove evolution beyond traditional perceptions of discount
Private labels further prove evolution beyond “traditional” perceptions of discount Consumer sentiment and measured sales momentum confirm this transition from the perception as a “cheaper alternative.” Private labels a preferred choice by many Charting growth: US Private Label share of sales over t
Slide 36: Trends to Watch
5 Trends to Watch Anticipating catalysts to change in 2025 Consumers are making conscious and subconscious decisions that address their unmet needs. From fundamental dietary and lifestyle shifts ignited by the rise of GLP-1 medications to new—and formidable—consumer expectations for AI, there are mu
Slide 37: Catalysts to 2025 change
Catalysts to 2025 change Emerging factors faced by key verticals across industries. Trends to Watch GLP-1 Hot Commodity The New Face Readiness Ripple Effect Costs of Omni for AI Assessing the expansive Analyzing the latest hot From the explosive social Assessing consumer lifestyle and socioeconomic
Slide 38: The ripple effect surrounding the rise and impact of GLP-1 drugs
The ripple effect surrounding the rise and impact of GLP-1 drugs Beyond the obvious, huge socioeconomic shifts lie behind the popularity of GLP-1s. 27% of US consumers say they’re likely to use a medication or drug to support their weight loss Sou rce : NIQ 20 24 Mid-Yea r Consumer Ou tloo k © 2024
Slide 39: The ripple effect surrounding the rise and impact of GLP-1 drugs
The ripple effect surrounding the rise and impact of GLP-1 drugs Beyond the obvious, huge socioeconomic shifts lie behind the popularity of GLP-1s. of US consumers say NEW spending they’re likely to start or US dollar volume CPG: conscious snacking, fiber & protein, digestive health, supplements & v
Slide 40: Omni trip type evolution
Omni trip type evolution: Small trips drive online today, but growth has favored larger trips Spearfishing (small trips) still command 57% share of online trips in U.S., but this has declined by nearly 2%, while online fill-in and stock up trips have grown. In-store – US market +0.5% 23% -2.2% vs. p
Slide 41: Evidence of the widened scope of today's social commerce revolution
Evidence of the widened scope of today’s social commerce revolution From product learning and discovery to the gamification of purchasing, there are many ways social media is influencing spending Purchase intent Learning and discovery Influence on choice Gamification 1 in 4 28% 22% 26% are likely to
Slide 42: The AI revolution is here
The AI revolution is here To build trust, consumers need to be guided through the rapid pace of change Understand which AI advancements are 60% would avoid sharing personal details virtually because they do not trust data privacy going to endear you to with AI technologies your consumers and which a
Slide 43: Consumers are open to AI involvement in their shopping decisions
Consumers are open to AI involvement in their There are many shopping decisions ways consumers have But the US is more hesitant than global consumers to trust AI. embraced AI in their shopping decisions. Consider these options alongside back-end would accept a product recommendation integrations (in
Slide 44: A looming commodity crisis?
A looming commodity crisis? Cocoa prices are hot, but wheat and milk prices have cooled Consumers and manufacturers need to monitor shifting commodities prices to anticipate and react to peaks and valleys. CPG categories adjacent to recent commodity price shifts Price & volume trend – Commodity Pric
Slide 45: What should manufacturers do when an essential commodity crisis looms?
So, what should manufacturers do when an essential commodity crisis looms? When faced with increased costs, consumers overwhelmingly prefer strategies to lower price per serving and smaller pack sizes, rather than producing lower quality products. If prices continue to increase / remain high in the
Slide 46: Your Insights Takeaways
Your Insights Takeaways 2025 A slow decline will yield a slower climb. Don’t overestimate the speed of consumer recovery. Strategy Roadmap The widest net will reel 2025 growth. Maximizing penetration is essential in this era of disloyal buyers. Key takeaways to fuel your growth. Expect a smaller pon
Slide 47: Thank You
THANK YOU. About NIQ NIQ, the world’s leading consumer intelligence company, reveals new pathways to growth for retailers and consumer goods manufacturers. With operations in more than 100 countries, NIQ delivers the most complete and clear understanding of consumer buying behavior through an advanc