Discretionary U.S. general merchandise retail sales revenue fell 7 percent in April 2023 year-over-year and unit sales fell 8 percent according to Circana, formerly IRI and The NPD Group.
The firm said April declines are consistent with declines in March, but stories of growth resulting from consumer lifestyle changes do exist in certain categories. Prestige beauty and apparel represent more than half of the top 20 performing categories in the first quarter, led by products like face makeup, fragrance juices, woven shirts, and sportscoats.
“Whether it’s the growing influence of social media, returning to the office, or just getting out to more activities and socializing, the social side of life is back,” said Marshal Cohen, chief retail industry advisor for Circana. “However, the enduring high prices of grocery items are forcing consumers to prioritize their spending decisions and make trade-offs.”
Consumer packaged goods (CPG) trends are also reportedly maintaining their trajectory from recent months, exhibiting diminished demand alongside elevated prices. Food-and-beverage sales revenue increased by 6 percent through April, but unit sales fell 2 percent. Non-edible CPG sales revenue was up 3 percent, and unit sales were down 5 percent. A deeper dive across CPG and food service performance reveals a search for convenience resonating with consumers, as sales of breakfast foods and other items are softening at grocery stores, while the morning meal is adding traffic momentum at restaurants.
“While consumers are still feeling financially crunched, they are also resuming their busy social schedules, and it is being reflected in the details of how they are spending,” said Cohen, “Manufacturers and retailers need to understand what is taking priority for the consumer, think about how that may evolve, and be prepared to respond to the opportunities that will come with the next phase of changes.”
Photo courtesy Vogue