The Wallet Can Only Take So Much
Last week, I was reading Kevin Coupe’s MorningNewsBeat, "Worth Reading: The Importance of Actually Listening to Consumers" when a comment caught my attention:
“The wallet can only take so much. At some point, they stop spending.”
It echoed what I’ve been hearing from industry leaders and seeing in client businesses. From rising tariffs to shifting shopping habits, the consumer landscape is under pressure—and it’s forcing companies to rethink everything from pricing to innovation. And, how they communicate the action.
At last month’s Food Industry Summit which I attended at St. Joseph's University, Rob Hill from Circana noted that while unit growth in food and beverage has flattened, frequency of shopping has ticked up—consumers are making more trips, but buying less. This “frequency without volume” pattern is a red flag: behavior is changing not from preference, but necessity. It is no surprise, as well, that they are also leaning towards more value items and private label. I know for me personally, I look twice when the branded offer is dollars higher. I think to myself, "Is it worth it?"
Consumer Sentiment Is Bouncing—but Barely
Kevin Coupe's article referenced a study conducted by the University of Michigan. Their Consumer Sentiment Index jumped in June 2025, its first meaningful gain in six months. Yet it’s still significantly lower than last year’s levels—a reminder that optimism is fragile.
Other data tells a similar story:
The Conference Board’s Consumer Confidence Index fell to 100.4 in June, with future expectations dipping below recession-alert levels.
A McKinsey study found that nearly 1 in 3 U.S. consumers are actively cutting back, especially younger generations, who are worried about inflation, student debt, and looming costs from new trade policies.
And feedback from grocery shoppers shows real strain: rising costs of essentials like coffee, orange juice, and snacks due to global supply shifts and tariff policy are making even basics feel like luxuries (Grocery Dive, July 2025).
What It Looks Like in Reality
Consumers are adapting fast—and not always in ways brands are ready for:
Trading down to private label, frozen meals, or bulk formats.
Deprioritizing innovation if it carries a premium price point.
Shopping smaller baskets more frequently to manage weekly spend.
Choosing perceived value over brand loyalty, especially in center store.
Even government policy is shaping behavior: proposed changes to SNAP eligibility and spending could further reduce purchasing power for lower-income households, affecting not just grocery retailers but also CPG manufacturers that rely on promotional lift (Grocery Dive, July 2025).
So What Can Brands Do?
The companies I work with often ask: What does “responding to the consumer” really look like right now?
Here’s what I recommend:
Don’t assume flat is failure. Holding market share, maintaining penetration, or stabilizing repeat purchase rates in this climate is a win.
Rethink value without defaulting to “cheap.” Bundle strategically. Highlight functionality. Reinforce long-term savings (e.g., “one pack lasts a week”). Trade-offs can be powerful if they feel fair.
Make your innovation work harder. Smaller sizes. Occasional indulgence. Premium lines for loyalists. Value lines to keep shoppers in your portfolio. Remove the excess "benefits" that the consumer does not value.
Listen more often and in more places. Consumer behavior changes are showing up in small ways—basket composition, trip frequency, time of day, DTC feedback. Tap into both data and real conversations.
Final Thought
We all want to believe that optimism and resilience will carry the market forward. But when the wallet shuts—or even hesitates—businesses need to meet the moment.
