New findings from pricing lifecycle management company Zilliant shows consumers are increasingly resistant to price increases, even when driven by market forces such as rising costs or supply constraints, according to a news release.
Zilliant said its inaugural Consumer Price Index Survey was designed to understand emerging pricing trends and consumer sentiment in today’s dynamic market. Research was conducted by Censuswide from Oct. 16-18, 2024, among 2,003 U.S. consumers aged 18 or older.
The survey found that roughly two-thirds (67%) of consumers report increased grocery spending since August 2024, with the average household spending $61.49 more per month. For 37% of consumers, monthly grocery spending has become unaffordable, with 1 in 8 (13%) finding it “very unaffordable.”
Notably, only 33% of consumers said they think prices should increase when production costs rise, while 32% explicitly stated prices should stay the same despite higher costs. This resistance to cost-based price increases underscores the growing tension between market realities and consumer expectations, the release said.
“Pricing has never been more important to both businesses and consumers,” said Zilliant CEO Pascal Yammine. “While consumers are feeling the impact of rising costs, there’s a clear disconnect between how pricing actually works and how consumers think it should work. This gap presents both a challenge and an opportunity for retailers to better educate and communicate with their customers.”
How consumers experience dynamic pricing
One key trend was how customers felt about changes caused by dynamic pricing — the changes in pricing caused by fluctuations in supply, demand, competitor actions and customer behavior, ensuring prices remain competitive and aligned with the market. The survey showed that many shoppers already encounter dynamic pricing, though they may not realize it:
- Almost half (47%) of consumers surveyed experienced price increases when a product was in demand when grocery shopping in-store.
- Over 2 in 5 (42%) consumers surveyed have experienced price cuts when a product expires when grocery shopping in-store.
- The 38% of consumers who cite inflated prices during high demand/low supply as a primary concern highlights the perceived negatives of dynamic pricing.
This highlights how grocery stores already use dynamic pricing strategies without labeling them as such. High-demand products often carry higher prices, while low-demand items typically end up in the clearance section.
What matters to today’s consumers
The survey revealed both consumer concerns and opportunities for retailers to build trust through innovative solutions. Top concerns about pricing practices include:
- 32% cite a lack of transparency around price increases as their top concern.
- 27% worry about price volatility.
- 19% want better explanations for price decreases.
- On average, a 30% price increase would make consumers consider switching brands.
- 78% would share personal data to access dynamic pricing that could lower their costs (30% would share purchase history, 27% would share age information and 21% would share location data or contact information).
- 46% would be more likely to shop at stores offering personalized prices through apps or loyalty programs.
- 42% want more physical store loyalty cards offering discounts.
- 29% desire more information about how pricing is determined.
- 23% specifically want personalized prices through mobile apps.
How consumers view supply and demand
The survey also showed a disconnect between pricing practices and consumer understanding.
- 47% of shoppers experience price changes based on product demand, but only 37% say they understand why prices change with supply and demand.
- Just 15% agree that prices should rise when demand is high and supply is low.
How retailers should respond
Zilliant said this data suggests that grocery stores could help ease concerns around dynamic pricing by proactively informing shoppers when prices are higher due to high demand, low inventory or inflation.
While brand loyalty appears strong, providing clear explanations for price fluctuations could enhance consumer trust and further strengthen loyalty, especially among shoppers who might otherwise consider switching brands due to rising prices.
Although sentiment around price hikes is generally negative, grocery stores can take steps to better inform customers and alleviate some of the financial strain — through discounts, loyalty programs and personalized pricing.
“These findings highlight both the challenges and opportunities in pricing,” Yammine said. “While consumers clearly want more transparency and control over their grocery spending, just like B2B businesses, the key is aligning prices with value and maintaining transparency that builds trust.”