Consumer behavior is undergoing a fundamental shift, which includes how purchasing decisions are made and how consumers engage with brands. What’s striking, however, isn’t the change itself, but that it’s likely to be permanent.
Consumer spending rose just ~1% in 2025. This shouldn’t come as a big surprise, given 34% of UK consumers have already experienced an erosion of purchasing power, and 65% have reduced spending.
And while it hasn’t stopped altogether, there is a change in how UK consumers are spending. Along with their global counterparts, they’re becoming more strategic and considered, and we’re starting to see a clear divide between where shoppers are willing to spend and where they expect to save.
Which brings us back to that fundamental shift. The recently released Purchasing Power report by Havas Commerce breaks it down, highlighting what it is that consumers are doing differently and what retailers need to do to adapt – not just to survive, but to become a defining player in the next era of retail.
Globally, people are on the hunt for value. ‘Value’, however, doesn’t simply equate to the lowest price. Rather, ‘value’ is a price that feels fair and is aligned with quality and assessed through a variety of sources, including past experiences, cross-checking prices, and product reviews. Only once a product has proven its worth will a UK consumer commit to the purchase.
UK consumers are particularly value-oriented, with 55% saying that getting the best value for money guides their buying decisions, more so than getting the lowest price.
Amid this strong focus on getting the best value for money, consumers are also turning with more confidence to discount stores and brands. Some 81% of UK consumers already feel that the quality of products they can get from a discount store is equal to that of traditional ones, and 90% believe that the discount model could become the retail norm – showing premium brands and products have to work hard to prove their worth if they want to end up in a shopping basket.
Aligning with the quest for value and increasing confidence in discount products, retailers’ private labels (PL) are also increasing in popularity. With a strong perception of quality and value for money, they represent a ripe opportunity for growth.
For retailers that get it right, PL product can build customer loyalty and become a competitive advantage – 33% of consumers already have a preferred PL, while 39% are willing to shift stores for an appealing PL.
To grow on this foundation, however, retailers will need to understand that consumers expect greater transparency and innovation alongside environmental and social commitments – highlighting rising standards that go beyond simple affordability.
While discounting is gaining in popularity, and consumers increasingly see a retailer’s PL product as a viable option, that doesn’t mean that it’s going to be the choice for every purchase.
The level of risk has an important part to play.
In standardized, ‘low-risk’ categories – such as clothing and household basics – consumers will happily opt for discount options or PLs where quality equivalence has been established.
However, in ‘high-risk’ categories – such as skincare, appliances, and tech accessories – quality will trump price, with consumers willing to spend more for better-quality items where proof of performance is visible.
‘Risk’ also influences buying cycles. Higher-risk items will come with a longer decision-making journey, which will likely include additional research, price comparison, and taking the time to see the product in person, before a consumer hands over their money.
Today’s consumers are looking for ways they can stretch their pound to fund the equivalence of their lifestyle, rather than giving up spending altogether. Where there’s a cheaper alternative that doesn’t pose a significant reduction in quality – in product or of life – shoppers will opt for the cheaper alternative. And this is already a popular price mitigation strategy in the UK, with ~21% of consumers switching to a cheaper brand when prices rise.
For higher value, higher risk products, more care is taken to find the best product for the best price, with consumers using several tactics to do so – from price comparison websites and user reviews, waiting for the product to be discounted, opting for lower-cost alternatives, or even deferring the purchase.
Discount codes and vouchers also remain a key influencer in purchase decisions, with shoppers preferring the immediate savings they provide. Loyalty programmes follow closely in popularity, with 42% of shoppers saying it influences their decision to purchase. So these are the tactics to employ if you want to sway a shopper in your direction.
Of course, there can’t be a discussion around spending habits without highlighting the latest generation with money in their pockets and how they’re choosing to spend it.
What’s important for retailers to understand is that Gen Z is incredibly disciplined when it comes to spending, and if something doesn’t meet their requirements, they won’t buy. They expect intelligible prices, observable benefits, and are the generation most likely to turn to social proof to check that a product works before they make a purchase. Thirty percent of Gen Z already purchases directly through social media platforms, making this a key channel for brands targeting this generation.
This generation also tilts towards premium products, both for the value they provide and the status they assign to them. And they’re willing to cut down on the basics to afford it or ‘invest’ if they deem it worthwhile, making use of installment payment plans and buy now pay later schemes to fund a purchase if they don’t have the money to hand right now.
Now that you understand how consumer behavior has changed and what is likely to be the norm, here are four moves to turn this to your advantage.
1. Make value obvious and defensible
Show clear pricing and prove performance with reviews, UGC, and comparisons. UK consumers, in particular, look for verification and expect clarity and fairness.
2. Know your category risk and optimize accordingly
Where performance is critical and reassurance matters, invest in premiumization with visible proof. In low-risk, standardized categories, emphasize PL and discount positioning.
3. Use PL as a loyalty lever
Build tiered private label ranges to reach more shoppers and communicate quality and sustainability commitments clearly.
4. Future-proof with Gen Z engagement
Build social commerce capabilities, integrate peer validation, and offer flexible financing. Position hero products as lifestyle investments, not just functional purchases.
Inviqa helps commerce and retail brands succeed in a value-driven, low-spend environment by creating frictionless, confidence-building purchasing journeys that make value transparent and reduce decision risk.
We combine strategy, experience design, and technology delivery to ensure pricing clarity, simplify product comparison, and enrich content with authentic reviews and social proof – all critical to reassuring today’s cautious consumer.
Beyond the basics, we enable future-ready commerce through composable architectures and AI-driven enhancements that improve discoverability, streamline catalog management, and extend transactions beyond traditional owned channels into emerging touchpoints such as social commerce.
With Inviqa, you gain a partner who understands the complexity of modern retail and can deliver scalable, insight-led solutions that turn consumer hesitation into confident conversion.
For the full insights and recommendations from the Havas Commerce Purchasing Power report, download your copy here.
