Bargain-hunting behaviours: how New Zealand’s shopping habits continue to change

Over the past couple of years, the price of groceries has become one of New Zealand’s hottest issues. Food prices were on course to increase by (NZ) $1,560 per household by the end of 2023¹, and more than half (59%) of New Zealanders say that the cost of living is a critical issue². In fact, inflation is seen to be a bigger problem than either the price of housing or the state of New Zealand’s healthcare sector—testament to the hold it has on the country’s psyche.

In this recent post, we looked at New Zealand’s gradual emergence from this difficult situation. Confidence is starting to rise, and the latest data from our ongoing Consumer Pulse study shows that optimism is beginning to creep into grocery shopping behaviours too.

All the same, New Zealanders remain acutely aware of the price of food—73% say that it is "a lot" higher than it was one year ago, the highest result by far in our global study. Only shoppers from the UK (62%) feel similarly.

With that in mind, how are Kiwis addressing that challenge? How are they shopping, and what behaviours have changed in their quest to save money? Let’s find out.

Trips to grocery retailers have declined—but discounters aren’t the big winners

Globally, it’s been a good couple of years for the discounters. In markets including France, Italy, the UK, and Australia, cut-price grocery retailers have enjoyed significant growth—driven in no small part by the prolonged cost of living crisis. With their grocery budgets under continued pressure, many shoppers have shifted their spend towards the discounters in an attempt to get the greatest bang for their buck.

In New Zealand, the situation is a little more nuanced. In our previous Consumer Pulse study, just 5% of respondents said they’d shopped with a discount brand in the seven days before. Fast forward to now, and that number has risen—but only fractionally. In our most recent study, a tenth (10%) of New Zealanders said they’d visited a discounter in the previous week, far below the number who said the same in Italy (35%), France (25%), and the UK (20%).

That said, more than half (56%) of respondents say that they do buy products at discounters. So, why the discrepancy? The most likely answer is that Kiwis are being increasingly specific about what they buy from where. They might stock up on non-perishables at a discounter, for instance, while continuing to pick up their "normal" weekly shop at another format.

There’s change afoot here, too: trips to grocery retailers have declined between our two studies. The number of respondents who’d shopped with one of those banners (in the preceding week) has fallen from 93% in our late 2023 study to just 50% today.

The winners here seem to be leading grocery chains. The percentage of people who’d shopped those destinations in the week before has risen considerably over the past year—from 5% at the end of 2023 to 58% today. Whether Kiwis believe that those stores represent better value for money isn’t clear, but one thing is: there’s still a very healthy mix between discount and traditional grocery.

Multiple strategies help with managing budgets

New Zealanders are using a variety of strategies to help manage their budgets effectively. And—importantly for retailers and brands alike—many of them begin long before a shopper walks through the door.

Today, more than half (54%) of Kiwis say that they search online to see where they can find the best deals (and plan to continue doing so in the future). 12% say that this is a behaviour they intend to introduce, and only 9% have plans to stop. Around the world, only Spanish shoppers are more likely to proactively search out deals (59%).

Pre-shop research doesn’t just apply to pricing, either. Around a quarter of respondents to the Pulse (27%) said they also search online for offers, they can use on products they buy regularly. Fall-off here is likely to be more severe, however, with 11% suggesting that they plan to stop doing this in the future.

At the shelf, the focus is very much on own brand. Well over half (57%) of respondents say that they currently buy private label products and will continue to do so in the future. While that figure is still high, it actually places New Zealand towards the bottom of the rankings when it comes to private label. Only in Italy (49%) do fewer shoppers say they buy own-brand. Spain and the UK (both 77%) lead the way here.

Moving to the checkout, one of those pre-shop behaviours comes full circle. Around half (46%) of New Zealanders say that they currently use coupons and special offers on items. A fifth (18%) say they plan to start doing so.

Going without: where New Zealanders are making sacrifices to save

Eating healthily is important to Kiwis—around half (47%) say that doing so makes them feel good. At the same time, a sizeable number say that eating well is also prohibitively expensive. A third (33%) of shoppers claim that they are "priced out" of leading a healthy lifestyle.

A similar (albeit less severe) situation exists in relation to sustainable produce. Again, while 45% of respondents say that they’re conscious about the state of the environment—and 18% that they buy sustainable goods when shopping—a quarter (24%) say that they find it too expensive to do so.

We see indications of sacrifices being made in other areas, too. While a third (34%) of shoppers say they’re prepared to spend more money to get better quality, a similar number (36%) don’t—and have no plans to in the future, either. More than a tenth (14%) plan to stop buying higher-priced, better quality items.

Generally, shoppers appear to be restricting themselves across the board. For instance:

• 38% say there are products they’ll only buy on special offer.
• 37% say they stock up on certain items when they’re on discount.
• 42% say they make a list and stick to it.
• And 46% say they usually buy the lowest-priced brand.

Inflation may be easing, but it’s clear that there’s a long way to go before New Zealanders feel truly comfortable about the price of food.

For more from the Consumer Pulse, why not read up on the trends driving New Zealand’s e-commerce boom?

¹ New Zealand's Cost of Living Crisis – ACT
² 23rd Ipsos NZ Issues Monitor Feb 2024