NIQ COO Tracey Massey joins Wealth! to discuss some of the latest findings in Nielsen IQ's latest consumer outlook report.
"We're expecting in 2025 for consumer growth to be about 6%. So you'd say, 'Wow, maybe that feels a little high,' but 30% of consumers are saying they're better off financially than they were a year ago. So while things are still difficult, they are saying they'll curb their spending, particularly on things like out-of-home entertainment, out-of-home dining, those sorts of things," Massey tells Yahoo Finance.
She also highlights how AI is influencing consumers' buying decisions, noting that 40% said they would use AI product recommendations. "I think people don't see it as so much as interference anymore, but here's an opportunity, here's an idea for you."
Watch the video above to hear what consumers are saying about GLP-1s.
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This post was written by Melanie Riehl
Nielsen IQ is out with their latest consumer outlook report with a guide to consumer spending habits in 2025. Here to discuss some of the findings, it's Tracy Massey, Nielsen IQ chief operating officer. Great to have you here with us. It's good.
Thank you, good to be here.
Let's dive into some of these numbers. I mean, I was looking at the growth anticipation and I was kind of shocked, especially considering how we've been tracking the moderation in consumer spending and some of the smart spending habits that consumers are trying to implement as well. Just walk us through some of the key figures here and I mean, whether or not that took you by surprise as well.
So we're expecting in 2025 for consumer growth to be about 6%. So you'd say, wow, maybe that feels a little high. But 30% of consumers are saying they're better off financially than they were a year ago. So while things are still difficult, they are saying they'll curb their spending, particularly on things like out of home entertainment, out of home dining. Those sorts of things, like 48% of people are saying reducing that. But the the outlook is looking better. Inflation is slowing, so 2% in the last six months. So it's slowing. It's still, their pockets are still challenged. Don't get us wrong. So what cost you $100 in 2022 is now 117 in 2024. So there are challenges, but overall, the picture's looking pretty good.
Yeah, and that was one of the remarkable parts of this report here as well. I mean, thinking about the total dollar figure of the expected rise in spend as well, I think it was somewhere around, what, 3.2 trillion dollars?
Yeah. Yep.
And so what is that on? Is that on volume or is that on price alone right now?
So, it's both. And it just depends which category you're in. So for some categories, the volume's starting to come back and pricing is smaller, but for others it's not. So as an example, snacking and confectionery, Okay.
See, that gets me every time.
60% of consumers are saying if the prices don't stop going up, we're not buying anymore. If they don't start leveling. But that's where the inflation is. So cocoa prices, dairy, inflation is really high there. So therefore, you're continuing to see prices and you're getting to a place though where it's it's getting difficult.
What was also really interesting within the consumer outlook was the amount of buying decisions that were influenced by artificial intelligence in some form or another. I mean, it gets me every time, I guess, as it's either showing up in my feed or even when I'm actually doing what I might think is some smart shopping online and doing some comparison shopping. AI is in there somewhere as well. I mean, what were some of the ways that you saw this showing up that could be a trend more long term as well?
Yeah, so previously, I think consumers didn't really trust AI. Now 40% of them are saying they would use AI. They like AI helping them with what to get. So I think people don't see it as so much as interference anymore, but here's an opportunity, here's an idea for you. So it's, in some ways, it's helping you. They see it as helping them versus being an interference, but your 40% say they use it. Now they'll see it and then they'll go into the store a lot of the time and decide what to buy. So we're certainly seeing an increase in in e-com, so over 11% increase in e-com, but people are still shopping in multiple places. So even though they might go online, they still go in store. So there is a mix.
All right, we can't wait till that robot is greeting me at the door and saying, hey, have you have you gone down this aisle as well? It's got to be in there, whatever you want in addition to the new soap that you're getting. I don't know. But lastly, while we have you here, one of the other catalysts that we've talked about a fair bit here on Yahoo Finance as well is just the impact of GLP1s. And I was surprised to see that show up in this report as well. How might that have a larger ripple effect?
So 31% of people are saying they would use GLP1s for weight loss or whatever. So you see that, then obviously in what they're buying, buying maybe more snacks that have protein in them because if you if your appetite is diminished and you can't eat that much, you're going to have to eat the things that are really, really important. So the type of food that they're buying is changing and again, it doesn't bode well for snacking and confectionery.
Tracy Massey, who is the Nielsen IQ chief operating officer. Great to have you here in the studio. Appreciate it.
Thank you, good to be here.