Kearney Consumer Institute Releases 2nd Consumer Stress Index: A Nuanced View into the Invisible Stressors Driving Global Consumer Behavior

• The US Consumer Stress Index drops 4 percentage points from Q4 2023.
• US consumers say their top stressors are the consumer wallet (32 percent) and geopolitics and government (21 percent).
• Geopolitics, innovation and technology were the biggest movers this cycle. 
• Higher flexibility in geopolitics: US consumers feel more empowered to influence global conflicts (up 10 points) and US politics (up 12 points). 
• Despite AI concerns, consumers show more flexibility in innovation and technology, due to use of new technologies to make life better (up 12 points).

CHICAGO, April 16, 2024 /PRNewswire/ -- The Kearney Consumer Institute (KCI), an internal think tank of global strategy and management consultancy Kearney, recently released the second quarterly edition of its Consumer Stress Index. Based on a unique set of macroeconomic data and consumer input, the Index provides a highly nuanced view of consumer sentiment, beyond economics. This second report, the Kearney Consumer Stress Index Q1 2024 Update, finds global consumers in 10 out of 12 countries, including the US, are slightly less stressed than they were last quarter.

"That our Stress Index gauges global consumer stress levels slightly lower than last quarter may seem surprising given ongoing coverage and concerns around food inflation, global conflict, and housing prices," notes KCI lead Katie Thomas, who leads the ongoing research. "However, analysis shows that consumers continue to adjust to these recurring challenges, which stabilizes their stress over time."

The Stress Index tracks multiple components: macroeconomic data, which is updated annually, and consumer sentiment, which is calculated using two elements: consumer flexibility (consumer agency in terms of perceived optionality and ability to impact conditions) and consumer sensitivity or awareness (what issues are top of consumers' minds and how they are feeling). Data for the Q1 2024 report was fielded in March, traditionally a less stressful time for many than the holiday season, which can exacerbate a baseline level of stress across the board.

"When dealing with consumer behavior, it is critically important to get as complete a picture as possible as there can be lots of anomalies at play," said Katie Thomas. "For example, we also identify two different forms of stress—the generalized stress people feel as a result of media coverage or peer group interactions, and individualized, personalized stress experienced directly, emotionally, and internally."

The report found that geopolitics and government has remained a top stressor since the initial index was released in January 2024. Consumers' sense of agency around political polarization improved slightly, with US consumers in particular expressing more empowerment vis à vis global conflict and national politics. That said, the Index calls for sensitivity and vocalized stress around geopolitics overall to offset much of this reduction.

"The biggest shift this quarter was seen in stress related to innovation and technology," Thomas noted. "As technology evolves, there is constant 'new news' keeping the topic top of mind and driving consumer stress. The distinction between generalized stress such as consumers' broad concerns over AI replacing 'millions' of jobs, and personalized anxiety around technological innovation, i.e., 'my job was just made redundant by a machine,' shows that while both can cause stress, the level of perceived agency by consumers can differ greatly."

KCI's advisory for consumer-facing businesses is to avoid messaging that exacerbates politically or technology related stress. Additionally, technologies based on what could be seen as radical innovation, or those that require humans to conform their behavior to a machine such as AI, should be introduced carefully to maintain consumer trust.

Read the full report by clicking this link.

For more information, to schedule an interview with Katie Thomas, or to receive a copy of the study, please contact:

MKPR/Meir Kahtan
+1 917-864-0800
[email protected]

Kearney Consumer Stress Index methodology

The Kearney Consumer Stress Index was created to examine consumer behavior globally by taking a broader view of consumer sentiment. It combines proprietary research, surveys, and analytics with publicly available data and reports, weighing and balancing macroeconomic factors, consumer flexibility, and consumer sensitivity.

Macroeconomic sources comprise 50 data points from leading global sources such as Oxford Economics, which are then organized into five pillars—consumer wallet and finances, health and education, geopolitics and government, food and the environment, and innovation and technology—across 15 sub-categories. This provides a quantitative, factual baseline for initial analysis of consumers.

Both the consumer flexibility and consumer sensitivity sections use proprietary consumer surveys as their primary input, with more than 18,000 global consumers surveyed (1,500 respondents in each of 12 countries). Survey results are used to determine scores across pillars and sub-categories. The consumer flexibility component shows consumer optionality and ability to flex to, and/or impact or influence, changing conditions. The remainder of the model—consumer sensitivity—reflects consumer top-of-mindedness and feelings on pillar sub-factors.

Combined, the three elements create the Index, the values of which reflect relative changes within a country based on consumer stress, leading to potential changes in behavior.

About the Kearney Consumer Institute
The Kearney Consumer Institute (KCI) evaluates today's business challenges and opportunities through the eyes and experiences of consumers, advocating a consumer-first perspective. By leveraging consumer behavior data and insights, the KCI helps generate conversation, and ultimately action, around how to address consumer needs with meaningful benefits.

Using a consumer-first lens the KCI looks at today's consumer revolution not by thinking about consumers, but by thinking like consumers. Our consumer-centric approach includes simple, precise, plain-language conversations on topics like trends, consumer communities, convenience, loyalty, service, fair pricing, and product development and technologies.

About Kearney
Kearney is a leading global management consulting firm. For nearly 100 years, we have been a trusted advisor to C-suites, government bodies, and nonprofit organizations. Our people make us who we are. Driven to be the difference between a big idea and making it happen, we work alongside our clients to regenerate their businesses to create a future that works for everyone. www.kearney.com

SOURCE Kearney