Amid Squeeze, Consumer Experiences All-Consuming Says Paysafe Poll
Amid the current economic squeeze, consumers are more than ever likely to abandon their ‘shopping carts’ at check-out if hit by surprise, or unwanted, fees, reveals recent research by Paysafe.
On the other hand, despite an increase in the cost of living, consumers still display a strong appetite for travel, leisure and other experiences.
The study found that 51 percent of consumers continue to prioritise spending in these areas over other discretionary expenditures.
The ‘Lost in Transaction’ report, an annual study by Paysafe, surveyed 14,500 consumers across Europe, North America, and Latin America to understand Consumer Payment Trends 2023 — and the impacts of shifting priorities on the experience economy.
Paysafe’s research also showed that more than 27 percent of consumers are spending more on dining out and take-aways than they did prior to the cost-of-living increase.
A quarter are investing more in streaming services. And 17 percent are spending more on travel, including day trips, flights and package vacations.
A small fraction of respondents, however, have “terminated” their discretionary spending.
Consumers polled appear to prioritise budget consciousness.
Nearly half of those questioned said they had at times “abandoned their shopping carts at the checkout due to tighter budget constraints” and that they preferred making purchases during seasonal sales or discounting events, such as so-called ‘Black Friday’ (67 percent).
Over half of consumers said they were making smaller, more frequent, purchases; reducing larger expenditures; while 61 percent said they were looking for ways to cut additional costs by repairing an item rather than replacing it.
Other consumers are leveraging the advantages of digital wallets and eCash to manage their financial constraints, with 48 percent of digital wallet users acknowledging the value of these payment methods’ connection to third-party money management tools.
eCash–now used by 60 percent of respondents, compared to only 26 percent last year–has experienced a significant increase in consumer adoption; while over two-thirds of consumers said they are using digital wallets more frequently.
Notably, some 52 percent of consumers polled said they are now happy to leave their physical wallets at home, and depend solely on a digital wallet or mobile device for purchases.
Commenting on the research, Rob Gatto, Chief Revenue Officer at Paysafe, said: “Our research shows that experiences are paramount — whether that’s where consumers are looking to spend their hard-earned cash, or how they are checking out for essential items.
“Even before the squeeze on household finances, consumers were already comfortable abandoning their carts.
“Now that they have the additional concern of tight budgets on their minds, they’ll be even more likely to do so if they’re hit with surprise shipping fees, can’t use their preferred payment methods, or encounter other unwanted friction points at the checkout.
“It’s never been more important for online businesses to ensure their checkout is optimised for a seamless customer experience.”