Irish shoppers are fundamentally changing their shopping habits, and nearly a third of consumers expect to reduce their spending in the next six months in response to rising prices, the latest PwC Ireland consumer insights survey shows.

An overwhelming majority of respondents to the survey (94%) say the recent price increases have impacted their purchasing ability, with 32% expecting their spending to come down during the second half of the year.

Approximately 36% of Irish consumers said that price increases have affected their purchasing power to "a great extent" while 58% said it had affected them to "some extent".

A total of 9,069 consumers across 25 territories, including 504 respondents in Ireland, responded to the biannual study. Fieldwork took place in March, and respondents were required to be at least 18 years old and to have shopped online at least once in the previous year.

Overall, rising prices for groceries were found to be the biggest issue facing consumers, with 75% of in-store shoppers and 56% of online shoppers citing the growing expense of groceries.

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Notably, 55% of people expect to spend more on groceries in the next six months, while 52% expect to spend more on travel and 45% expect to spend more in restaurants and bars, with belt tightening in purchases on luxury goods (37%), takeaway food (33%), online activities (31%) and fashion (26%).

Supply chain issues are also affecting the shopping experience, with 51% of in-store shoppers and 56% of online shoppers reporting that they were unable to purchase a product due to it being out of stock.

To combat supply chain issues, 43% of Irish consumers are shopping at different retailers to meet their needs, 31% are using comparison websites to check product availability, and 29% of online shoppers say they are switching to in-store to better meet their needs, 22% of in-store shoppers are switching to online.

As a result, 69% of those surveyed have increased their shopping online, but 76% of Irish consumers are happy to pay a higher than average price for products produced locally, slightly below the global average of 80%.

Similarly, 72% of Irish consumers and 79% of total respondents will pay a higher than average price for products that are recycled, sustainable or eco-friendly.

Nearly six in 10 people in Ireland (57%) have increased their buying from local retailers, compared to 36% globally, and in the next six months, 46% expect to shop more frequently with retailers located close to them, again ahead of the global average of 36%.

Despite the shot online, 45% of Irish respondents and 33% of global respondents expect to shop more in physical stores over the next six months while 42% expect to shop more online, rising to 51% for millennials, 56% for Gen Z and dipping to 28% for Gen X and 24% for baby boomers.

"Just as consumers continue to change their shopping behaviours and preferences, actively searching for the best shopping experience and choice, retailers and manufacturers must move quickly to meet shifting demand and their own inflation and supply chain pressures," said John Dillon, lead of PwC Ireland's retail and consumer practice. 

"We don’t see these pressures easing anytime soon. Agile businesses that can manage through multiple disruptions while keeping their focus on the demands of their customers are in the best position to succeed in this tumultuous environment.”

(Pic: Getty Images)