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Inflation Results: Consumer Trends and Current Events

Emily James

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    Inflation is a serious topic for consumers in the UK - it impacts how they spend, how they think and how they will interact with brands in fundamental ways. As such it was the perfect topic for our latest Man vs. Machine experiment.

    In February this year, we re-ran the Man vs. Machine experiment to see whether the artificial intelligence algorithm ChatGPT would match up to the expert researchers we have within our business when it comes to writing impactful and effective surveys.

    Survey design is a key skill that all market researchers need to master, as surveys have been a staple and go-to of market research projects since the conception of the insights industry. But with continuous advancements in technology and the latest evolutions of artificial intelligence wowing the nation, we needed to find out how ChatGPT measures up to one of the leading experts in the market research industry – FlexMR’s Head of Insight, Charlotte Duff.

    While ChatGPT’s survey writing skills didn’t match up with that of our in-house expert’s, the surveys designed by both ChatGPT and Charlotte did produce some very differing but interesting insights into the state of consumer opinion on the current state of inflation.

    Details, Details...

    We gave Head of Insight, Charlotte Duff, and ChatGPT the exact same objective and parameters for their surveys, and received two very different surveys as a result. Those objectives were simple:

    • Understand current perspectives on inflation in the UK
    • Gain awareness of how inflation is impacting life in the UK

    Both surveys ran between 27th January and 6th February 2023, using FlexMR’s Open Ideas InsightHub platform, collecting a total of 82 responses on each survey. But because of interpretation, the two surveys had entirely different questions and garnered equally different insights.

    The Open Insights platform holds a nationally representative sample of respondents, and this blind study split the platform’s sample into two halves, so one half received the AI-generated survey, and the other half were sent the expert-designed survey.

    Tweet from FlexMR Tweet This
    There is a high level and still rising concern over inflation rates across all demographics, our study shows how this concern has altered the opinions and behaviours of UK Consumers.

    Inflation Analyses: A Summary of Two Surveys

    Charlotte’s survey reported that there are currently very high levels of concern both around the broader economic climate, but also specifically around current inflation rates and the rate in which they are rising. This is something that was also reported in the ChatGPT survey, with over 65% of respondents reporting concern, of which 35% being very concerned and 30% being extremely concerned.

    However, the ChatGPT survey also showed that there is a mixed knowledge around inflation, with nearly 15% of people believed the current rate of inflation to be under 4%, but 95% of respondents correctly identifying the following statement to be accurate, “inflation is the rate at which prices for goods and services are rising.” This was mirrored in Charlotte’s expert survey, with 20-25% of respondents saying they don’t feel fully informed as to the causes of rising inflation and what it means to the economy, as opposed to just over half who believe they are fully informed. So, while there is a high concern across respondents, the knowledge level regarding inflation does seem to be lacking in some groups.

    The ChatGPT survey also reported that nearly 70% of respondents disagreed with the notion that the current inflation rate in the UK is a necessary consequence of economic growth – those most likely to disagree with this are those with an annual household income between £20-40k, and this same group is also shown to be most likely to feel a negative impact on their personal finances due to this inflation.

    When then asked in the ChatGPT survey how different categories have been affected by the current rate of inflation in the UK, respondents believe that rent or mortgages are the most affected (46%) followed by interest rates (39%), while the impact on food and fuel prices were felt to be much less significant. In Charlotte’s expert survey, when discussing the impact of inflation on lifestyle compared to 12 months ago, respondents remarked to be making several key changes:

    • There is a definite switch to be more conscious of spending, both on essentials and luxury items, with 73% being more conscious of monthly expenditure and 43% spending less on luxuries/treat items.
    • Cutting back on luxuries/treats is being done across all ages, income groups and family structures.
    • Holidays and cars purchases are two areas where spending appears to be down.
    • Comparison of prices is a growing trend with two thirds more likely to do this than 12 months ago, in particular, those with children under 18.

    Linked to this, another question in Charlotte’s survey asked about the impact of current inflation levels on their household, the majority reported increased grocery costs, and 81% acknowledging increased energy bills and a further 65% pointing towards fuel costs. Half of those who own a home with a mortgage have seen increased mortgage costs, and 4 in 10 households with children have seen childcare costs rise as well.

    After all of this, it was made clear in Charlotte’s survey that there is definitely an appetite for more support around inflation – nearly half of respondents don’t feel that the current support available for either households or businesses is sufficient, and those who are retired/are not working appear to be even less satisfied with the support available than those who are working.

    This point was agreed on by the respondents who completed the ChatGPT survey, as over 75% are currently dissatisfied with current efforts by the government to combat inflation, and over 90% feel the government should be actively doing more. Out of the options presented to respondents, 54% believe the government should be implementing price controls, 36% want the government to reduce government spending (47% of respondents believe this increased spending is a factor contributing to inflation) and 35% would like to see lowered interest rates to combat inflation.

    Tweet from FlexMR Tweet This
    Due to the continuous rise of inflation, 73% of UK consumers report being more conscious of monthly expenditures, and 43% are spending less on luxuries/treat items.

    Lastly, I would like to draw notice to one area of interest on Charlotte’s expert survey that ChatGPT didn’t think to explore: media coverage of rising interest rates and where inflation rates have peaked – there is some scepticism surrounding this topic, with only 26% believing that it has indeed peaked. Of this 26%, those most likely to believe inflation has peaked are those aged between 35-39, and those least likely to believe are those aged 18-29.

    There are a number of similar results across both surveys, which support the high level and still rising concern over inflation rates across all demographics. While there are some support measures in place a large consensus across both surveys indicates that a lot of respondents would like a lot more support in a wider range of areas, however it was not specified who should provide this support; so while it would be prudent of the government to take into account the desires surrounding their own spending cuts there are more opportunities at hand for businesses, the government, and charities to take advantage of when it comes to helping the country through this tough time.

    Insights Empowerment

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