Stagflation hits Americans to save money, causing sales of affordable perfumes to surge

The term “stagflation” has become increasingly popular in the investment community in recent days. Everyone has begun to worry about whether the U.S. economy will enter a downturn, dragging down the performance of U.S. stocks. It is confirmed that Americans have already felt the hidden worries about the economic outlook, and they are downgrading their consumption and preparing to live a tight life. Taking perfume as an example, consumers are beginning to abandon expensive products and switch to affordable deodorant bottles. Supermarkets that specialize in low-priced products are opening more and more due to the popularity of consumers.

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Sales of affordable roll-on deodorant soar

Usually, everyone gets scared when they hear “inflation” or “deflation”, but in fact, “stagflation” is the scariest thing. Because the economy began to stagnate after a round of rapid development, the unemployment rate began to rise, but inflation remained at the previous high level, and the three major negative factors were comprehensively attacking. According to the latest statistics, U.S. GDP growth in the first quarter was only 1.6%, lower than market expectations of 2.4%; the annual inflation rate was 3.5%, up from 3.2% last month; and the unemployment rate was 3.8%.

In fact, economists have been warning that stagflation will occur in the United States over the past two years, but the investment community seems to have turned a deaf ear and is still intoxicated by the excitement of U.S. stocks reaching new highs. However, Shengdou citizens feel it most directly. Americans have begun to accumulate stocks as early as last year. To prevent hunger, “save your living expenses” because everyone is worried about losing their jobs at any time due to high inflation. According to research from the e-commerce platform Pattern, sales of affordable roll-on deodorants (similar to deodorant products bought in supermarkets) in the United States surged 207.24% in 2023 compared with the previous year, occupying the third place in the rankings, and outperforming many big brands. Brands such as Burberry, Dior, Gucci, etc. are all higher, and sales of low-priced perfume trial bottles also increased by 183.45%, showing that some consumers are switching from expensive products to affordable products.

“Lipstick effect” predicts consumer sentiment

In economics, there is the so-called “Lipstick Effect”. No matter how bad the economy is, women will buy lipstick to make themselves happy. Now even perfume sales have similar changes. I believe it can become a new alternative economic indicator. “When you look at the economy, consumer confidence is starting to waver and consumers are tightening their belts,” Dallin Hatch, a data analyst at Pattern, told CNN.

Another statistics conducted by market research company Circana showed that mini-bottles accounted for 38% of the total perfume sales last year, up from 35% the year before. Jacquelyn Wenskus, fragrance market analyst at Circana, pointed out: “Perfume prices of less than one ounce are only one-third of the price of large bottles. The low price attracts consumers who are cautious about spending money but still want to buy something to make themselves happy. purchase.”

Consumption downgrades, affordable supermarkets expand rapidly

Americans are “downgrading their perfume consumption” to combat stagflation. Another battleground for saving money is supermarket consumption. Aldi and Lidi in the United States have always been known for being ordinary. The products they sell mainly focus on their own brands. At any time, the price is half or even lower than that of other supermarkets. The former has even more There is a grocery section known as the “Aisle of Shame”, which sells clothes, shoes, kitchen supplies, toys, etc., and has become a treasure hunt for budget-conscious consumers. According to Jones Lang LaSalle’s “Grocery Report 2024”, there will be 253 more supermarket stores in the United States in 2023. Among them, Aldi is the most aggressive, accounting for 109 of them. Aldi also plans to open 109 stores in the United States by the end of 2028. Added 800 new branches.

In addition, Aldi also completed the acquisitions of Winn-Dixie and Harvey’s Supermarket, adding 400 stores to the company in southeastern states including Alabama, Florida, Georgia, Louisiana and Mississippi. This shows that the future is uncertain. Next, the importance of affordable supermarkets in the minds of consumers.