Consumer trends in 2023
5 key trends in consumer behavior in 2023
Consumer behavior reflects the entire range of actions that the buyer performs in the process of choosing a product until the moment of its purchase. The economic situation influences consumer habits, adjusting old ones and creating new ones. In this article we will look at the key trends in consumer behavior and what they mean for the home goods business.
Trend 1: Conscious consumption
The strategy of reasonable consumption has always been characteristic of Russians, but this approach has been observed steadily for more than 10 years. It emerged after the 2008 crisis and strengthened after 2014. The feeling of uncertainty and the unknown about the future forces buyers to be more attentive to planning and making purchases, and to refuse unnecessary goods and services. Customers also continue to purchase goods in installments. The trend towards a balance between price and quality is manifested through company loyalty programs, the increase in the number of white label products, fixed prices and tiered pricing.
Trend 2: Shopping at sales
Sales are used to purchase both large items and everyday items. Purchases are related to meeting current needs, and not for future use. The growing role of sales is due to consumers' budget reductions and the desire to save on purchases of essential goods. During times of uncertainty, shoppers are reducing spending on luxury goods and technological innovations, concentrating on reallocating budgets towards basic purchases (groceries, baby food, clothing and shoes). According to data from October last year, 45% of consumers reduced spending on leisure and entertainment, 44% abandoned expensive purchases and durable goods, and 41% redistributed their budget in favor of food and essentials. When making a purchase, the consumer pays attention to three key aspects: value of money, time and assortment.
Trend 3: The growing role of marketplaces
Shopping on marketplaces has become a part of our daily lives. According to the Statista resource, in 2021 the volume of online commerce worldwide amounted to more than $5.2 trillion and, despite foreign political instability, this figure will only grow. There are several large marketplaces in Russia that are attracting more and more visitors due to ease of use and a wide range of goods in almost any category. For example, the best-selling products in 2023 are cosmetics, household chemicals, pet products, clothing and smart appliances. According to a study by the analytical company DataInsight «Sellers on Russian marketplaces in 2022», in the second quarter of 2022, the sales volume of platforms amounted to more than 400 million orders and more than 500 billion rubles. It is worth noting that during online shopping, customers demonstrate the same behavioral models as in offline stores: it is important for them to choose and pay only for the item they like, and also to easily issue a return if necessary.
Trend 4: Request to slow down
According to a special online survey by Ipsos in May 2023, 58% of Russians would like to slow down the pace of their lives, and 84% of respondents agreed with the statement that the world today is changing too quickly. In this regard, a request is being made to brands for minimalism and simplicity of products, and compliance with information hygiene. Crisis events push people to reassess their values, which inevitably affects their purchasing experience and approach to purchases in the long term. There is also the growing attention to the environmental agenda: what materials are these or that products made from, the possibility of recycling them, or the search for more environmentally friendly alternatives.
Trend 5: Import substitution
A current trend due to the departure of familiar and large brands in different sectors of the economy. Consumers are looking for alternative brands in terms of price and quality but are not willing to pay as much for the products of new brands as for established and proven brands. It is also worth noting the growing interest in local producers.
Trends in consumer behavior in the home goods market
The previously listed behavioral strategies are also reflected in purchasing habits when purchasing household goods. Experts say that the market for household goods is influenced by the economic environment - in the current conditions, buyers are focused on the price of the product, and also try to save money and look for discounts, cashbacks and bonus programs. According to Big Time Retail experts, there is a slowdown in the dynamics of sales of furniture and household goods against the backdrop of an increase in construction and finishing materials, as well as a shift of buyers to a lower price segment. However, a factor in market growth may be the so-called «lipstick effect»: if it is impossible to purchase a new apartment, buyers can buy new decorative or interior elements for their old home.
According to AKIT, household goods are in second place in the top 5 in the all-Russian ranking of the most popular goods on the Internet. The popularity of home goods and decor began to grow during the lockdown and continues to this day. According to expert forecasts, from 2021 to 2026 the global market for goods in this category will constantly grow by 4.8%. The same trend is observed in Russia, especially in the context of online sales.
Interest in household goods also continues to grow among networks in the furniture, fashion, DIY and food segments. For example, against the background of the loss of tenants, shopping centers are showing interest in HouseHold formats, and many remaining brands on the Russian market are expanding their product line and opening new lines of business.