While Kearney’s latest Consumer Stress Index report shows less overall stress as compared to the prior quarter, the report’s authors say it is important to understand the nuances at play that create stress. These include geopolitical events, climate change, housing prices and elections, among other factors.
The report pinpoints the media as a trigger in the initial spike in stress, but which slowly recedes. It’s not like consumers become desensitized over time, but more likely they are able to manage the stress by adjusting to “a new status quo” while seeking ways to reduce stress.
As a result, Kearney found that global consumers “in 10 out of 12 countries — including the United States — are slightly more relaxed than they were a quarter ago. What’s behind this apparent de-stressing? Determining that is critically important to all consumer-facing businesses, the media, and politicians in a complicated year economically and geopolitically,” the report stated.
Regarding the nuances that affect stress levels, the report’s authors said 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. For example, the prior stress index wave, from Q4 2023, was fielded in the midst of the holiday season — traditionally a more stressful time for many people trying to balance last-minute shopping, end-of-the-year finances, entertaining, and travel, which can exacerbate a baseline level of stress across the board.”
With this report, Kearney said consumers had time to settle into new routines, “without the added stress of the holiday season.” It’s also important to note that the components, or pillars, of the index are regularly updated to reflect truer consumer behavior.
Greg Portell, lead partner of global markets at Kearney, said consumers are often viewed as unpredictable, unreliable, and irrational. “But in reality, we just need a better way of understanding their sentiment and actions,” Portell said. “Through our tracking of macroeconomic trends, you can get a sense for how consumer mind space impacts purchasing behavior. In this index, we categorize this into five pillars that drive consumer stress: consumer wallet and finances, health and education, geopolitics and governance, food and the environment, and innovation and technology.”
Meanwhile, media coverage has a strong influence on consumer stress levels. “When the conflict in Ukraine began, consumers around the world were initially deeply concerned about everything from potential gas price increases to the threat of nuclear war,” the report stated. “Intense media coverage heightened this initial anxiety level, but over time it became less top of mind.”
Kearney said when it comes to conflict, severe climate change-related events, or even pop culture, “consumer stress tends to peak at their first exposure to news, and as ‘new news’ is received those stories tend to take over the top-of-mind position and older stories tend to be deprioritized.”
The report’s authors said the role of media is clearly defined, “consumer stress aligns with current coverage and events. However, the longer the elapsed time from when the story first broke, the less shocking the news, and over time, the further from their initial awareness an event becomes, the less of a direct stressor it represents.”
Portell said social media plays a big role in how consumers get their news, “and while consumers may initially feel higher stress upon their first exposure to the news, over time and through repeated exposure it becomes less shocking.”
“Consumers want to know what’s going on, and with social media at the tips of their fingers it’s easily accessible, which leads consumers into the cycle of consuming stressful news, feeling like it’s the status quo, and repeating it,” he added.
