‘Economic uncertainty causing consumers to re-evaluate spending in 2023’

‘Economic uncertainty causing consumers to re-evaluate spending in 2023’

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Consumers are thinking more critically about where they will spend their money in 2023, with 81 per cent saying they will reassess their budget over the next 12 months, states a recent research, highlighting expected critical changes to consumer spending amid inflation and economic uncertainty.

According to a new global survey of 5,000 consumers by Mulesoft, retailers are most at risk. 79 per cent of consumers say they will reassess their spending with retail brands over the coming year. 52 per cent expect a better experience from their favourite brands as a result of the current economic climate.

Consumers also expect brands to use their data to offer more relevant customer services, with over 60 per cent reporting they expect companies to react instantly with the most up-to-date information when transferring across departments. Bolstering trust can also be an opportunity for loyalty as 76 per cent of consumers say that companies that provide data security will encourage their loyalty.

On the flip side of the coin, consumers were also willing to report what made for a poor experience, states the research.

When added together, frustrating experiences create negative brand perceptions — and possibly, a future customer lost. According to 52 per cent of consumers, poor quality service is the primary reason that prevents them from making a repeat purchase.

Research shows that personalized customer experiences are no longer ‘nice to have,’ they are essential to competing in a changing economy.

“Companies that want to increase customer loyalty must leverage real-time, intelligent, and automated technology solutions that support seamless connected experiences and personalized journeys,” said Mulesoft. “Businesses must be capable of both understanding and acting on their data. This will mean the difference between thriving or surviving as businesses navigate challenges in 2023.”

Travel and hospitality and media and entertainment also face the potential for lowered spend, with 78 per cent and 70 per cent of consumers, respectively, reporting reassessment plans in those sectors.