IRISH CONSUMERS will never recover from the guilt they feel about their consumption during the boom years, a retailing conference was told yesterday.
Just as consumers who lived during the Great Depression were destined forever after to be frugal, Irish shoppers will always seek value now that the boom is over, David McGee, retail director of PricewaterhouseCoopers (PwC), said.
Changes in shopping trends, such as a move to cheaper shops and cheaper ranges, greater uptake of special offers and the purchase of more own-label goods, were here to stay, he told the Checkout conference in Dublin.
This was true across all social classes, and the vast majority had been pleasantly surprised by what they found when they started buying more cleverly, he said.
Ninety per cent of people surveyed by PwC, for example, said they had got the same quality or better when switching to cheaper products, and almost 80 per cent felt they got the same or better value.
Price was no indicator of quality any more, he said, citing the example of tests carried out by the company on a variety of plain black T-shirts. One of the cheapest T-shirts, costing less than €6, came first for quality, while the dearest model, costing over €44, came only fourth.
When polo shirts were tested, a model costing less than €14 was ranked highest for quality while the most expensive, at €96.50, came fifth in the tests.
According to Mr McGee, this meant that people now felt not only guilty but “stupid” about their shopping habits during the boom. Retailers trying to persuade consumers to trade back up needed to accept that these changes were permanent.
“The recession has brought about a new way of shopping with many of these changes likely to be permanent,” he said. “Scrimping and splurging” would also become more pronounced, with the same consumer being prepared to spend more on goods with genuine value but focusing ruthlessly on the lowest prices for commodities.
Two out of three consumers were reacting to the recession by “buying clever” and over half were buying less, the research carried out by PwC also found.
Over half of consumers said they would continue to buy cheaper versions of products such as toothpaste and washing powder when the recession was over. However, fewer shoppers were prepared to stick with cheaper vegetables and meat post-recession, and even fewer were willing to compromise on an indulgence food such as chocolate, the research found.
Half of all retailers felt more optimistic about their business in 2010 compared with last year, and one-third said they were planning to open new stores and/or entering joint ventures in the coming year.