Starbucks CEO recently revealed that infrequent customers are becoming more cautious spenders. According to executives at Amazon and Starbucks, US consumers are tightening their purchases as they become more thoughtful about their spending. Amazon’s CFO mentioned that customers were looking for deals and trading down for lower-priced items. Similarly, Starbucks’ CEO commented that customers were growing more cautious with their spending habits.
The current economic outlook and rising costs continue to impact consumer confidence and spending habits, making it essential for companies to adapt to these changes. Lower- and middle-income households are seeing softening spending growth, according to a report by Bank of America. These challenges are highlighted by companies such as McDonald’s, whose CFO mentioned that customers were trading down to value menu items in an effort to save money.
Despite facing challenges, US consumers are still trying to stretch their dollars in the face of inflation. Executives at Amazon and Starbucks did not provide immediate comments when contacted by BI outside of regular business hours. However, the company’s recent data suggests that infrequent customers have impacted sales across the industry due to their more cautious approach towards spending.
It is evident that companies need to be innovative in order to cater to this new reality of cautious spenders. They need to create products and services that offer value while also being affordable. By doing so, they can continue attracting customers despite the changing economic landscape.
In conclusion, infrequent customers are becoming more cautious spenders due to the current economic situation. Companies such as Amazon and Starbucks have noted this shift in consumer behavior and are adapting accordingly by creating offers, deals and promotions aimed at attracting these consumers while maintaining affordability.