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How did shoppers change in 2022?
Slowing growth, high interest rates, and global uncertainty is affecting households in Latin American markets as the cost-of-living crisis intensifies. 2023 is already proving to be a challenging year for the region.
Although the global pandemic is behind us, it has fundamentally changed the way people live, work and shop in the region, accelerating the growth of FMCG retail and leading to a diversification in the retail channels used by Latam households.
But as one crisis fades, new economic and social challenges are accelerating changes in consumer behaviour.
Faced with inflationary pressures, and annual price increases of 14.1% in 2022, Latam shoppers, especially those in low-income households, are having to manage their budgets more carefully. As they shop around to find value for money, more consumers are visiting more channels than ever before, with discount channels benefitting the most. Shopper missions are also changing as consumers purchase more frequently across a greater number of stores, both offline and online.
While the rapid growth of ecommerce in Latam seen during the pandemic is slowing, it is now an essential part of omnichannel retailing in the region and attracted three million new online shoppers in 2022. Pure and Non-pure* retail platforms sustain growth in 2022, connecting more types of channels and reaching new user profiles. Meanwhile, WhatsApp, although it does not follow the same behavior, continues to be the one that reaches the largest number of online shoppers, 14.7 million in Latam.
In the face of more fragmented spending and the decline in customer loyalty, the challenge for FMCG retailers and brands is how to attract and retain shoppers and ultimately, gain greater share of wallet.
*Pure: Companies with online commerce platforms and without brick-and-mortar storesNon-pure: Supermarket and hypermarket chains’ websites or applications
