Charities’ efforts on cost of living deemed ineffective by most Brits
Charities’ efforts to support people during the cost of living crisis are not cutting through to the general public, research suggests.
While over half (51%) of British people recall seeing charities talk about the cost of living crisis, just one-third agree they are effectively supporting people through the crunch.
The cost of living crisis is expected to remain a prominent issue by the vast majority of those surveyed, with 82% agreeing it will be an urgent problem for the remainder of this year. Despite expectations that economic challenges will persist, there is some optimism with more than two in five (42%) selecting “hopeful” as one of three words to describe their mood for the year ahead.
Concerningly for charities, there is an increasing number of regular givers who are considering cancelling their donations. This number has risen to 14% from 10% in July 2022.
However, the overall sentiment for giving is still strong, with more than six in 10 (61%) of givers declaring their intention to keep their donations at the same level or higher in the next three months.
Source: Good Agency/YouGov
Loyalty schemes drive the purchase of certain products
More than half of UK consumers report feeling encouraged to buy particular products because of a discount offered under a loyalty scheme, finds research from NIQ.
Additionally, 44% of shoppers report retailer vouchers and coupons are important in determining where they shop. A ‘special price discount’ on products from loyalty schemes is the promotion most likely to influence where consumers shop, with 35% of the respondents stating this is most influential.
This is closely followed by ‘everyday low price’, which 34% say is most influential.
“Our recent survey indicates that during a period of high inflation, shoppers are looking for different ways to save money and loyalty card savings are a win-win strategy as they reward both shoppers and retailers,” says NIQ UK head of retailer and business insight Mike Watkins.
The research comes as retailers such as Tesco and Boots have cut the value of their loyalty schemes. From June, points gathered under Tesco’s Clubcard scheme will be worth twice their value rather than three times, as they are currently.
Consumer spending see Mother’s Day boosts
Retail sales in the UK last month were boosted by Mother’s Day, as shoppers searched for items like fragrances, jewellery and flowers.
Like-for-like retail sales increased by 4.9% in March, versus a decline of 0.4% in the same period last year, finds data from the British Retail Consortium (BRC) and KPMG. This was above the three-month average growth of 4.6% and the 12-month average growth of 2.1%.
Food sales increased 8.5%, both on a like-for-like and total basis, above the 12-month average of 5.8%. In March, food sales were in growth year on year.
Meanwhile, growth in non-food sales was more modest, rising 1.4% on a like-for-like basis over the three months to March and 1.8% on a total basis. This figure is above the 12-month total average decline of 0.1%.
The sales figures are not adjusted for inflation.
BRC chief executive Helen Dickinson says a wet March “dampened sales growth for fashion, gardening and DIY products”. She says upcoming events like the King’s Coronation will likely give a boost to retailers alongside recovering consumer confidence.
“However, extensive cost pressures on business remain, and government must ensure it minimises incoming regulatory burdens,” she states. “Unless these future costs are brought to a heel, we will likely see high inflation continue for UK consumers who already face rising household bills from this month.”
Commenting on the research, IGD CEO Susan Barratt claims “shoppers are becoming less fearful” about inflation, citing research that just one-third (33%) now expect food to get much more expensive in the year ahead, versus over half (53%) in August 2022.
More than half of digital media budgets spent on below-par ads
Marketers are wasting a significant proportion of their media budgets on creative advertising that does meet basic best practices, according to research from CreativeX.
The analysis reviewed around 2 million pieces of online content from leading advertisers in 2022. It finds the majority of advertisers are allocating 55% of digital media spend to adverts that did not meet basic creative best practices for platforms.
This is the equivalent of $1bn (£804m) in media spend on advertising which was below-par in terms of creative best-practice.
The adoption of platform-specific creative best practice such as upfront branding or use of sound can help increase return on media investment. CreativeX’s research finds ROI of advertising spend uplifts as high as 66% among creatives that meet each platform’s best practice guidelines.
“As brands respond to a challenging economic environment for consumers, increasing scrutiny is being placed on marketing budgets,” says CreativeX CEO Anastasia Leng.
“Our data highlights both an uncomfortable truth and a tremendous opportunity: brands are creating thousands of digital ads, and investing millions into them, despite the fact they are not set up for success.”
Businesses expect social media to become primary way for consumers to find brands online
Social media looks set to overtake search engines as the preferred way consumers look for brands, with 82% businesses believing consumers will find brands through social media, rather than traditional search engines in the future.
Currently, almost one quarter (24%) of consumers aged 18 to 54 go to social media first to search for brands. That figure rises to 36% among Gen Z consumers.
Seven out of 10 of the businesses surveyed are already selling directly through social media, and 80% are buying advertising on at least one of Facebook, Instagram, YouTube and TikTok.
Social media is also becoming a primary channel for customer service. Almost three-quarters of businesses (74%) say they expect social media to become consumers’ preferred channel for customer service this year.
TikTok is the channel which is seen to have the most potential. Over half (55%) of businesses say it is the social media channel which has the most potential for growth, versus just 8% who think the same about Instagram.