Rise of the Independent Consumer as Cost of Living Continues to Top the Agenda – EY Future Consumer Index

According to the latest EY Future Consumer Index the cost of living is still at the top of the pressures weighing on Irish consumers’ minds. Almost 62% of Irish households are extremely concerned about the cost of living, outweighing concerns around geopolitical conflict (39%), climate change (38%), personal finances (36%) and the economy (33%). The research also states that although they are concerned about this pressure almost 4 times as many consumers feel in control and confident for the future as those who do not.  

In addition to this the research carried out for the EY Future Consumer Index has found that there has been a significant rise in the Independent Consumer, with households in Ireland showing markedly less brand loyalty and a willingness to switch to private labels (48%) or cheaper versions of high-end brands (50%) in search of value, a figure significantly above the global average (34%). 

The Independent Consumer is savvy and keen to save money. In the past six months, six in ten Irish shoppers say they have used an online discount code, four in ten (42%) have joined a retailer’s rewards programme, and more than one in three (35%) say they have joined a mailing list simply to access a discount/voucher. 

Speaking about the cost-of-living challenges faced by consumers and the rise of a more independent consumer Collette Devey, Consumer Products and Retail Lead at EY Ireland said:  

“Cost of living challenges continue to be front of mind for both Irish and international consumers, which in turn is driving the rise of the Independent Consumer. Consumers remain acutely aware of their spending, however, this focus on price is matched by continuing preference for both high quality and good value. 

To square this circle, we are seeing consumers acting more consciously and independently than in previous times. Brand loyalty is often taking a back seat, the switch to own brands or cheaper versions of premium products is continuing, while cooking at home or repairing rather than replacing are also notable.  Online, consumers are willing to sign up to mailing lists or download apps in search of discounts and better value. 

“Consumer trust is crucial in today’s digital era, which is marked by information overload and frequently misleading products claims. Online influencers are increasingly stepping into the trust gap here, acting as advisors and recommenders for consumers. Our research also finds that cybersecurity is non-negotiable for consumers, with a cyber-attack likely to deal a hammer blow to consumer loyalty for an organisation or product. 

“For businesses to thrive in this environment they must invest in innovation right across their operations and meet customers where they are – whether that is by offering increased value for money via private labels, loyalty programmes and extended ranges, or by offering a seamless experience online and offline. Brands and businesses must recognise the increasing weight that consumers place with influencers and their recommendations, however this cannot come at the expense of overall trust in the brand or product. 

“All of this is no mean feat, but the businesses that strike the balance will be the ones that succeed, as the Independent Customer increasingly votes with its feet – or its thumb.” 

Overall, the concern around cost-of-living prices is driving people to change their lifestyles to make things work. Irish consumers are wasting less food, buying less alcohol, spending less time going out and more time at home and repairing items instead of buying replacements.  

EY Ireland’s Chief Executive Loretta O Sullivan said: “It has been a tough period for many households but there are grounds for cautious optimism about the future. We are already seeing energy providers reducing prices, a slower pace of food inflation and the European Central Bank has just cut interest rates. These are welcome developments, as is the continuing strength of the labour market. Jobs are being created and wages are rising, signalling an uplift in consumers’ financial situations. This is reflected in our research findings, with 42% of respondents expecting to be better off in a year’s time. All of which gives us reason to believe that consumer spending growth is in prospect for Ireland.”    

The Index also uncovered that many Irish consumers are planning on focusing more on their personal health in the coming years. They plan to embrace new technologies and digitally enabled pathways of care including sharing health data to access care.  

Colette Devey says, “This openness to technology provides significant opportunities for Ireland’s healthcare sector and for businesses to lean into digital technologies to deliver the care that Irish consumers want right now and which they say will be an increasing focus for them in future”.