63% Indian to cut back on non-essential spending; 74% concerned about personal financial situation: PwC

Consumers globally, as well as in India, are weighed down by their personal financial situation, which has had an impact on their discretionary spending. A majority of Indian consumers are cutting back on non-essential spending, and an even greater portion of people are worried about their personal financial situation, according to PwC Global Consumer Insights Pulse Survey. 

According to the report, 63 per cent of Indian consumers are cutting back on discretionary spending, and around 74 per cent of respondents are concerned about their personal financial situation – which is higher than the global 50 per cent. 

The survey took into account the views of 9,180 consumers across 25 territories in the countries, including metros, Tier 1 and Tier 2 cities. Of the respondents 57 per cent were male and 43 per cent were female. 

As cost-of-living increases, consumers are shifting their consumption habits, the PwC survey found. Nearly half – 45 per cent – of respondents said that they are buying certain products when on offer or promotion, while 44 per cent are looking for retailers that offer better value. 

As much as 38 per cent are using comparative sites to find the cheaper options, while 36 per cent are buying in bulk to cut costs. 

Half of Indian consumers – 50 per cent – said that rising prices is the most-frequently experienced issue when shopping in-store. Supply chain issues also remain a concern as consumers face longer queues, busier stores, and product availability. 

Most Indian consumers, the survey found, expect to reduce their expenditure in the next 6 months. Some of the segments that are likely to see the most reduction include luxury and premium products, and fashion. Spending on groceries is expected to decline the least. 

The greatest decrease, when it comes to consumers spending, is expected to be in the segments of luxury/premium products or designer products (38 per cent), virtual online activities (32 per cent), consumer electronics (32 per cent) and fashion products like clothing and footwear (31 per cent).

Travel (30 per cent) and groceries (21 per cent) had the least reported planned spend reduction. However, there remains an appetite for future spends. 

Ravi Kapoor, Partner and Leader - Retail & Consumer, PwC India said: “PwC’s latest Global Consumer Insights Survey for India drives home the key message of ongoing financial stress in the lives of the consumers, where 75 per cent of them are very concerned about their financial situation. This sentiment will have a potential restraining effect on spends in highly discretionary categories of electronics and luxury.”

Despite a reduction in spending, consumers have said that they are willing to pay more for sustainable products. More than 88 per cent are willing to pay more for locally sourced and produced, recycled, or sustainable products. Around 87 per cent are willing to pay more for eco-friendly materials and for products by a company with a reputation for ethical practices. 

Moreover, while adoption of the metaverse as a shopping channel is still in its early stages, only 23 per cent of Indian respondents are familiar with the term.  

Additionally, data privacy is also that concerns Indian consumers as they increasingly continue to shop online. As much as 65 per cent respondents are very concerned while interacting with social media companies, third-party/portal travel websites (54 per cent), healthcare (59 per cent), and consumer companies (58 per cent). 

Forty-one per cent respondents said that they do not share more personal data than they must, while 37 per cent opted out from receiving communications from the above companies. 

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