AlixPartners releases comprehensive EMEA Consumer Priorities Survey, The Critical Consumer 2024

14 December 2023

48% of UK consumers increased their spending in the grocery sector in 2023, while 63% expect to maintain their spending levels in 2024
Despite a decrease in inflation, many UK consumers grapple with a loss of purchasing power, where approximately half of households anticipate spending less on non-food items
43% of UK consumers spent less on travel and holidays in 2023 and 32% anticipate a reduction in travel spending in 2024

LONDON, December 12th, 2023 – AlixPartners, a global consulting firm, today released its highly anticipated EMEA Consumer Priorities Survey, The Critical Consumer 2024, providing a comprehensive analysis of consumer sentiment and preferences across the region. In a year marked by economic challenges and geopolitical insecurities, the report offers invaluable insights for businesses aiming to navigate the evolving landscape of consumer-facing industries.

The lingering effects of the post-pandemic era have created a crunch in consumer budgets, intensifying competition among brands competing for a share of the constrained spending. Geopolitical uncertainties, particularly in Ukraine and the Middle East, further contribute to the complexities facing consumer-facing industries such as Retail, Consumer Products, Restaurants, Hospitality, and Travel. The year 2024 is expected to continue this trend, with varying impacts on each sector.

To help businesses thrive in this challenging environment, AlixPartners conducted an extensive consumer priorities survey across seven EMEA countries, including France, Germany, Italy, Saudi Arabia, Switzerland, the UAE (United Arab Emirates), and the UK. Between October and November 2023, over 10,000 respondents were surveyed, by YouGov for AlixPartners, and provided insights into their personal purchase intentions and shopping preferences for the upcoming year.

UK Consumer Spending Trends: 2023-2024 Snapshot Reveals Shifting Patterns

The report unveils insightful data that reflects evolving consumer behaviours and preferences in 2023 and provides a glimpse into expectations for 2024.

In the realm of electronics, 47% of UK consumers tightened their purse strings in 2023, signalling a significant shift in spending habits. Meanwhile, the grocery sector experienced a contrasting surge, with 49% of consumers increasing their expenditure compared to the previous year.

Looking ahead to 2024, 42% of consumers express their intention to cut back on spending in the sporting goods category. The shift suggests a nuanced re-evaluation of discretionary spending among UK shoppers.

The report underlines the increasing reliance on technology, with 72% of consumers embracing self-checkout and home delivery options. Furthermore, 54% of respondents expect tailored offers, and a staggering 77% prefer receiving promotions online, emphasizing the need for retailers to optimize their digital channels.

Despite a decrease in inflation, many consumers grapple with a loss of purchasing power. This is notably evident in mid-range income brackets, where approximately half of households anticipate spending less on non-food items. As a response, consumers are turning to private labels, seeking affordability without compromising quality.

Retailers are urged to adopt omnichannel solutions to cater to diverse consumer groups. While productivity improvements are crucial, it is essential to balance technological advancements with the preferences of older demographics, who still favour traditional payment methods such as cash.

Loyalty in the retail landscape extends beyond pricing, with consumers increasingly desiring personalised offers and marketing. This trend is more pronounced among younger and higher-income demographics, challenging retailers to strike a balance between personalization and broader loyalty strategies.

The report highlights the growing role of technology, particularly AI (Artificial Intelligence), in enhancing online buying experiences. Notably, the younger generation, particularly those aged 18-24, displays a preference for digital terminals over in-person interactions in stores.

In the grocery sector, 48% of consumers increased their spending in 2023, while 63% expect to maintain their spending levels in 2024. However, the report indicates that consumers are reaching their capacity to absorb grocery price inflation, signalling potential challenges in budgeting.

The hospitality and travel sector faced challenges in 2023, with 43% of consumers spending less on travel and holidays. Looking ahead, 32% anticipate a reduction in travel spending in 2024, reflecting a potential slowdown in the post-COVID travel boom.

Digital technologies play a pivotal role in travel planning, with 60% of consumers using online platforms to book holidays. However, there remains a segment (40%) that rarely or never utilizes digital channels, emphasizing the need for diverse booking options.

Consumer sentiment reveals a cautious approach to spending in 2024, with a considerable proportion of respondents expecting to spend less across various consumer product and leisure categories. The report advises businesses to consider the impact on producers and carefully assess promotional strategies considering consumer budget constraints.

The implications of economic headwinds and digital disruptions will likely lead to accelerated transformation and consolidation in consumer-facing industries. Businesses that proactively adjust to market and consumer shifts can position themselves for sustainable success in the evolving landscape.

Matt Clark, Partner & Managing Director and, EMEA Retail Lead at AlixPartners said, “Our latest consumer research shows widespread belt-tightening across the board, with only grocery maintaining spend levels but even here, volumes still drop sharply because of inflation. Only those retailers at the very top of their game will retain or grow share of wallet and I fear we are in for another round of restructuring and consolidation in early 2024.”

Andrew Searle, Partner & Managing Director and, EMEA Consumer Products Lead at AlixPartners said, “The message is clear for the Consumer Goods sector- consumers behaviour is continuing to shift into 2024 and ability to pass inflationary increase prices without significant volume loss is over. As retailers' position to be the champion of consumer value - the CPG-Retailer dynamic is shifting. 2024 will be a challenging year for Consumer Goods companies, only the most proactive management will thrive in this environment.”

Steve Braude, Partner & Managing Director for Restaurant, Hospitality & Leisure at AlixPartners said, “As consumers tighten their belts across all areas of spend, they are looking at value for money when it comes to spending on leisure pursuits. While it is true that holiday and leisure spend is typically the last thing that consumers cut, our research indicates that they will not be spending more in 2024. Consumers are now looking for operators that provide the best experience, with great service, in their price range. The winners will be those travel, hospitality and leisure companies who execute brilliantly on their product, and delight customers on every step of the journey."

The full Critical Consumer 2024 report can be found here.