
As we ease into 2025, the overall consumer confidence across European markets remains stable yet fragile.
While confidence levels have not seen significant shifts, the underlying sentiment tells a story of caution. In Germany, for instance, the latest wave reveals a marked decline in consumer confidence, driven by high energy costs and labour market unrest. This is in stark contrast to the Netherlands, where consumers exhibit the highest confidence levels across the tracked markets, supported by moderate economic growth and easing inflationary pressures.
In the UK, consumer confidence remains flat following the autumn budget, with stable perceptions of disposable income and job security, yet growing pessimism about the future economic outlook. This nuanced landscape underscores the necessity for brands to stay attuned to market-specific dynamics.
Tight household budgets and spending habits
Economic pressures continue to squeeze household budgets across Europe, significantly influencing spending habits. Although there is constrained spending on discretionary items, the hospitality sector (alcohol and eating out) have seen a slight improvement in the last quarter..
So what? Household budgets remain tight across all sectors. Consumers are anticipating spending less across all areas, which means that persuading them your brand is good value for money is crucial. Which brings us to…
Evolving perceptions of value for money
The notion of “value for money” is evolving, particularly among younger generations and male consumers. While price remains a critical factor, there is a growing emphasis on other value dimensions such as product durability, brand reputation, and sustainability efforts. This shift is driven by generational changes, with younger consumers adopting a broader perspective on what constitutes value.
Loyalty schemes could play a crucial role in communicating a brand’s value for money and creating a loyal following, with 81% of consumers indicating a higher likelihood of shopping with brands that offer such programs.
So what? Value messaging is becoming increasingly important as we head into 2025. Brands need to recognise and address generational differences in value perception when marketing their offerings to different consumers.
Keen to learn more about consumers economic confidence and spending habits? Download our Consumer Compass report today.
The Consumer Compass is a quarterly report produced by Savanta to track attitudes and behaviours in consumer confidence. The insight is drawn from the responses of over 3,500 consumers in the UK, Netherlands, Germany, France, Spain, Italy, and the Nordics.