Amazon’s CFO and Starbucks’ CEO have both stated that infrequent customers are becoming more cautious spenders in the current US economic climate. These executives have observed a shift in consumer behavior, with people being more thoughtful about their spending and seeking out deals on lower-priced items.
According to Bank of America’s report, US consumers are facing challenges due to inflation and are trying to stretch their dollars. Lower- and middle-income households, in particular, are experiencing softening spending growth. Companies such as McDonald’s have also reported that customers are trading down to value menu items in an effort to save money.
While companies such as Amazon and Starbucks did not provide immediate comments when contacted by BI outside of regular business hours, it is clear that the current economic outlook and rising costs continue to impact consumer confidence and spending habits. Companies must adapt to these changes by finding ways to meet the changing needs of consumers while still maintaining profitability.