73% of US Consumers Change Buying Habits Amid Inflationary Pressures

The 15th edition of the EY Future Consumer Index (FCI), released on March 27, 2025, has highlighted significant shifts in consumer behavior in the United States as inflation and economic uncertainty reshape purchasing habits. The study surveyed 20,000 consumers globally, including 1,500 in the US, revealing that 73% of American shoppers have changed their buying habits due to price increases over the past year.

Key Findings: Price and Value Take Priority

• Price Sensitivity: Half (50%) of US consumers now consider price the most important factor in purchasing decisions.
• Private Labels: Adoption of private-label products has increased, with 76% of consumers saying these options help them save money—up nine percentage points since September 2023. However, 55% of those who try private labels switch back to branded options, citing superior quality, taste, or performance.
• Generational Divide: Older generations (Gen X and baby boomers) are more likely to shop at discount retailers and supermarkets (56%), compared with younger consumers (44%), such as Gen Z and millennials.

Changing Consumer Values

Inflationary pressures have led shoppers to prioritize price and quality over brand familiarity. Established brands face growing scrutiny when raising prices or reducing pack sizes. Consumers are most likely to cut back on snacks and confectionery (36%), alcoholic beverages (35%), and dining out or ordering takeout (35%).

In contrast, fresh food (32%), household care products (32%), and clothing (31%) remain more resilient categories.

Mark Chambers, EY Americas Retail Sector Leader, commented:

"Retailers have always dealt with varying degrees of geopolitical uncertainty, inflation, and supply chain disruptions. What's different now is the acute ability to measure their connection with consumers and how these external influences impact day-to-day buying habits."

Brand Loyalty Under Pressure

Despite the rise in private-label adoption, branded products still hold significant appeal for many consumers:

• Switching Back: Fifty-five percent of shoppers who try private labels return to branded products for their perceived reliability and quality.
• Consumer Flexibility: Seventy-one percent of consumers are willing to switch brands if their preferred option is unavailable. Additionally, 65% would switch for a better price, while 59% are open to trying new brands.
• Generational Trends: Gen Z and millennials represent the highest proportion of brand switchers at 54%, while older generations are more likely to reject unfamiliar brands outright.

Challenges for Brands

Brands must adapt to meet evolving consumer expectations by demonstrating value through product innovation and pricing strategies. However, nearly half (46%) of US consumers remain skeptical about product improvements, often perceiving them as cost-cutting measures rather than genuine enhancements. Furthermore, 51% feel that brand marketing messages fail to resonate with their needs and values.

Rob Holston, EY Global Consumer Products Sector Leader, emphasized:

"Brands that understand the price-value equation for consumers will be able to handle the headwinds they are facing and deliver on growth in the years to come."

As competition intensifies between private labels and established brands, retailers must refine their pricing strategies and inventory optimization tools to cater to value-conscious shoppers. Innovative approaches that balance affordability with quality will be key to maintaining customer loyalty in a rapidly changing market landscape.