The inaugural "Consumer Spend Report" from digital marketplace Upside highlights multiple findings, including the rise of the "uncommitted customer" — an opportunistic consumer group who shops across different locations and formats, prioritizing their own needs over brand loyalty.
The report, which offers a detailed exploration of consumer behaviors and sentiments, analyzes data from over a billion transactions and nationwide surveys to provide insights for retailers, according to a news release.
“Every day we work to deeply understand what retailers and consumers need, so we can make brick and mortar commerce work better for all of us,” said Upside co-founder and CEO Alex Kinnier. “This inaugural spend report sheds light on important shifts that can help retailers make better business decisions, and the rise of the uncommitted customer is chief among them. When we think about our own buying behavior, I think we'll find that 'the uncommitted customer' is most of us. And retailers are now grappling with that reality.”
The "Consumer Spend Report 2024" is based on research including the analysis of 1.1 billion transactions from over 8,000 retail partners and two national surveys of 3,700 U.S. consumers, according to the release. The report also incorporated insights from over 3,400 consumer interviews. Upside said this year’s report found five notable trends:
- Negative consumer sentiment about the economy — Despite a cooling inflation rate, 56% of surveyed consumers perceive the economy as worse than the previous year. This sentiment is reflected in their budgeting behaviors, with 89% of respondents relying on coupons or promotions to control spending. Younger consumers (aged 18-24) and larger households expressed the most pessimism with their financial situation.
- Price sensitivity driving uncommitted customer behavior — Consumers are cross-shopping more than ever, with 81% of grocery shoppers comparing prices across stores and a significant portion belonging to multiple loyalty programs. This trend is prevalent across food and fuel categories, highlighting the growing number of uncommitted customers who prioritize value over brand loyalty.
- Decline in inflation-adjusted sales across categories — The report reveals that while topline sales figures may appear stable for businesses, adjusting for inflation shows a decline in real revenue across categories. Grocery stores have experienced a 3% decrease in inflation-adjusted revenue per transaction year-over-year, with restaurants and convenience stores facing similar challenges with even larger impacts.
- Loyalty programs have wide adoption but limited influence — Loyalty programs remain a critical strategy for retailers, with over 90% of consumers considering loyalty rewards when choosing where to shop. However, the report highlights a disconnect between loyalty membership and loyal behavior. Many consumers join multiple programs within the same category and say they use loyalty on half of transactions or less.
- Skepticism over dynamic pricing — Although more consumers are aware of dynamic pricing, widespread adoption remains limited due to mixed consumer sentiment and potential media scrutiny. Alternatively, personalized promotions are viewed more favorably, with 45% of respondents preferring retailers that offer tailored discounts.