NielsenIQ (NIQ), the leading global consumer insights provider, has released its eagerly awaited Mid-Year Consumer Outlook: Guide to 2025 report, highlighting macro catalysts that span multiple industries. This forward-looking analysis reveals that consumers remain determined and resilient amidst uncertainty, offering a strategic framework for retailers aiming to capture consumer interest over the next 12 to 18 months and beyond.
The report projects that global consumer spending will increase by $3.2 trillion in 2025, reflecting an approximate 6% growth compared to 2024, as reported by World Data Lab.
In light of ongoing and unprecedented global economic challenges, grasping consumer behaviour has become crucial for businesses striving to succeed in an ever-evolving marketplace. NIQ’s biannual study offers a comprehensive examination of how economic events and trends influence consumer confidence, evolving consumer attitudes, and critical insights into the elements driving purchasing choices. Additionally, the report examines regional differences, delivering detailed insights into the distinct dynamics of Asia Pacific, Europe, North America, the Middle East, and Latin America.
Amidst rising uncertainties surrounding geopolitical crises, economic stability, and environmental issues, consumers are demonstrating resilience and focusing their spending where it matters most. This marks a significant shift from cautious to intentional consumption, emphasising prosperity and well-being.
“There is an escalating demand for AI-driven insights based on vast quantities of granular data that only NIQ can provide,” commented Tracey Massey, COO of NIQ. “Maintaining a comprehensive understanding of current and anticipated consumer behaviour, benchmarked on a global scale, has become essential for establishing and sustaining a competitive advantage.”
Global Catalysts for Change in 2025:
- AI Adoption: 40% of consumers are open to receiving product recommendations from their AI assistants, and the same percentage is inclined to utilise AI to streamline their everyday shopping choices. This necessitates that businesses evaluate which AI advancements will resonate with consumers and provide options to support older demographics.
- Impact of GLP-1 Drugs: 31% of global consumers are likely to use medication or drugs to aid in weight loss. The introduction of GLP-1 medications is expected to have broad implications, inspiring new avenues of spending, influencing consumer lifestyles, and shaping social norms.
- Omnichannel Development: The rise of social commerce has spurred the evolution of omnichannel retailing, with an 11.6% growth in global online sales performance. Additionally, 36% of consumers report that they would be inclined to spend more due to engaging in-app experiences.
- Commodity Prices: 60% of respondents indicated they would purchase fewer snacks and confectionery items if prices continue to rise or remain high in the upcoming three months—marking the highest dropout response across all categories surveyed. Notable increases in commodity prices include Cocoa (+128%), Coffee (+43%), and Milk (+44%), as per Trading Economics.
Top Trends Influencing 2025 Spending:
- Consumers’ primary concern remains soaring food prices (33%), followed by rising utility costs (20%) and the looming threat of an economic downturn (19%). Climate change ranks fourth (14%), largely due to the series of extreme weather events witnessed globally.
- A significant majority (67%) of surveyed consumers worldwide indicated they would consider switching or trying a new brand due to more competitive pricing.
- Consumers plan to continue reducing expenditures on non-essential items, including Out-of-Home (OOH) Dining (38%), OOH Entertainment (37%), and Food Delivery/Takeaways (36%). A decrease in out-of-home (OOH) activities is anticipated, while deliberate spending on in-home entertainment (48%) and socialising/gatherings (46%) is expected to remain consistent in 2025.
- The interest in private label products continues to grow, with 50% of consumers purchasing more private label items than ever before. Moreover, 40% of global consumers stated they would switch to a private label product they enjoy, even if it comes at a higher price.
- North American consumers are most concerned about escalating housing costs, whereas global conflict remains a primary worry for those in Africa, the Middle East, and Europe.
- The monthly inflation rate for consumer packaged goods (CPG) has been decreasing across different nations, currently averaging under 2% compared to the previous year. However, inflation remains higher than average in Latin America and Africa, with Latin America experiencing a rapid price increase of up to 9% year-on-year.
- Upselling Potential: Consumers are prepared to pay a premium for valuable features. In the Tech & Durables sector, sales of high-end smart and mobile phones have risen by 17% in 2023 compared to 2019, whereas economy options have declined by 32% during the same period.
In the last six months, a significant shift has occurred from cautious spending to more intentional consumption habits. Consumers are willing to spend more but remain vigilant about potential changes,” stated Lauren Fernandes, Vice President, Global Thought Leadership, NIQ. “They are seeking value in every purchase and are strategically allocating their spending to ensure they leverage any surplus wisely in 2025 and beyond.”
NIQ’s Mid-Year Consumer Outlook: Guide to 2025 offers essential insights for businesses to navigate emerging trends and strategically plan for sustainable growth. The report underscores a significant shift in consumer behaviour from caution to intentionality in consumption.