Volume sales are shrinking, as shoppers battle rising prices – but the hopeful recovery of shopping frequency brings more chances to engage.
So, are shoppers still making bulk purchases, like we observed during the pandemic? The truth is that they are already starting to cut down on purchase volumes due to a combination of lower in-home consumption and higher prices. We already know that inflationary pressure started to have an impact in Malaysia as early as Q4 2021; the question is now how shoppers are going to manage the ever-rising prices, including those affecting essential groceries.
As a result, we’re expecting that ‘buy less and shop more’ will be their mantra.
Shoppers have been paying more for their FMCG products, and this has forced them to change the way they shop. Baskets have been shrinking, and people are no longer focusing on stocking up their pantries – which means shoppers are opting for smaller volumes or buying fewer items or categories overall.
Shoppers will be more selective in what they put into their basket, making competition for space in the basket more intense. This means that both above-the-line and below-the-line marketing activities are very important: brands will need shoppers to remember and consider them even before they buy, and subsequently convert them in-store. It’s crucial that FMCG manufacturers know how relevant their brand or category is to shoppers, what their needs are, and how to showcase a stronger reason-to-buy.
Secondly, consumers will shop more. We have seen shopping frequency recover in recent months, with shoppers going back to the store more often. This translates to more windows of opportunity for brands to engage and target them. Brands should leverage this trend by focusing on product availability and relevance of assortment, to maximise basket conversion.
