Amid cost of living pressures, UK shoppers are making strategic choices in the grocery market.
- 36% of UK shoppers continue to reduce their grocery spending.
- 48% are actively seeking savings by shopping around for better deals.
- The food and drink market is expected to grow modestly as economic pressures ease.
- Health-conscious products are gaining popularity, with significant growth seen in related sectors.
The cost of living remains a significant concern for UK shoppers. According to recent data, 36% of UK consumers are cutting back on grocery spending. This reflects the ongoing financial pressures faced by many households. Meanwhile, nearly half of the population, 48%, are looking for savings by comparing prices and shopping selectively across different outlets.
The food and drink sector anticipates modest growth of around 1% in the coming year as cost of living pressures are expected to slightly ease. However, the industry faces challenges from new regulations and increased operating costs. Notably, the £3 billion extended producer responsibility scheme and other working practice changes are adding to the pressure on businesses.
There is a noticeable shift towards health-conscious products among UK consumers. The gut health market, currently valued at £367 million, is experiencing a significant 12% annual growth. Similarly, alcohol-free beverages have seen a remarkable increase of 25%, while nicotine pouches have surged by 92%. These trends reflect a broader consumer shift towards healthier lifestyles and products that support them.
Manufacturers and retailers are advised to focus on distribution, utilize off-shelf displays for promotional boosts, and leverage price elasticity for competitive pricing decisions. Emphasizing health-conscious trends and functional health products is seen as crucial for accelerating growth in this evolving market.
Alex Lawrence, Circana’s senior strategic insight director, notes that while 2025 will pose challenges for the FMCG sector, there remains potential for solid growth for those investing wisely in these trends. He suggests that smarter promotions and effective use of retail channels can provide opportunities for growth.
These trends highlight shifting consumer priorities amid economic pressures, urging retailers to adapt quickly.
