Consumers tighten budgets, but still seek fairness and spend on small indulgences: Capgemini
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Indian and global consumers are cutting back on discretionary spending and buying smaller quantities to manage financial pressure, but are still carving out room for small indulgences that offer emotional relief, according to a new report by the Capgemini Research Institute.
The study, which surveyed 12,000 consumers across 12 countries, finds that value is no longer defined by price alone. Instead, fairness, transparency, and trust are increasingly shaping buying decisions, even as households remain wary about their shrinking purchasing power.
Nearly half of consumers said they are purchasing smaller quantities or opting for cheaper alternatives to stretch budgets. At the same time, seven in ten consumers reported treating themselves to small indulgences as a way to cope with financial stress, underlining what the report describes as a shift toward “intentional” spending rather than blanket cutbacks.
Price transparency is emerging as a major fault line between consumers and brands. Around 74% of respondents said they would switch brands for a lower regular price, while 71% said they would abandon brands that reduce pack sizes or quality without clearly informing customers. A majority described shrinkflation as unfair, with consumers preferring modest and clearly communicated price increases instead.
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“Value today goes beyond price and quality—it’s built on fairness, transparency, and emotional connection,” said Dreen Yang, global consumer products and retail leader at Capgemini. “Consumers want invisible AI that empowers informed decisions while blending convenience with emotional connection,” Yang added.
Despite heightened price sensitivity, brand loyalty remains strong in categories where quality and safety are perceived as critical. The report notes that 77% of consumers across income groups avoid private labels for products such as electronics and baby care, indicating that trust continues to outweigh cost considerations in certain segments.
AI-Led Future
The study also highlights the growing role of artificial intelligence in shopping decisions. One in four consumers said they used generative AI-based shopping tools in 2025, and another 31% expect to adopt them in the future. These tools are increasingly being used for product discovery, recommendations, and real-time assistance.
However, enthusiasm for AI comes with conditions. Only 19% of consumers said they would pay for AI-powered shopping assistants, while 71% expressed concerns about how generative AI uses personal data. Nearly two-thirds said they trust AI more when it explains the reasoning behind its recommendations, and 76% want the ability to set boundaries on how AI tools operate.
Interestingly, the report also points to a renewed importance of human interaction. More than 70% of consumers said they still value human assistance for complex purchases or service-related issues, suggesting that technology alone is not enough to secure loyalty.