January 14/Chicago/Business Wire -- The U.S. economy has entered the third stage of its unprecedented transformation and will be characterized by shoppers permanently changing several of their most important rituals involved in the consumer packaged goods (CPG) products they select, purchase and use. With volatile and uncertain conditions ahead, consumers are spending with caution -- continuing to define what is truly essential. Despite relief from record breaking fuel prices late in the third quarter, increases in food prices still have shoppers spending more on groceries and getting less. It remains a challenging time for manufacturers who must reinforce the value proposition of their brands without selling out their equity. For retailers, private label continues to be a survival strategy for many consumers, and private label brands continue to evolve in their sophistication, quality and availability.
This is one of the findings in the just released "Transforming Economy 3.0: The Search for Affordable Solutions," created by Information Resources Inc. (IRI). "While the recession is far from over, our new research reveals that we are entering a third phase," notes IRI Consulting and Innovation president Thom Blischok. "The first phase, 'Shocking the System,' was characterized by rapidly rising energy and food prices, and a dramatic weakening of the home mortgage market starting in late 2007."