US shoppers trade down as inflation squeezes discretionary spending

· Beauty & Fashion · United States

Bank of America data shows US households, led by financially squeezed Millennials, are trading down to discount brands or cutting discretionary spending altogether as inflation bites, WWD reports. The shift matters for beauty and fashion because it points to a consumer who is still spending but increasingly choosing value over brand, and who is willing to forgo non-essential purchases entirely. For retailers and brands, the read-through is continued pressure on full-price selling and growing reliance on promotions and entry-price ranges. Millennials, a core cohort for both sectors, are singled out as the most stretched group in the data.

Why it matters：Trading down among a core beauty and fashion demographic signals softer full-price demand, pushing brands toward value tiers and promotions into the holiday season.

Key points

  • Bank of America data underpins the findings.
  • Millennials are the most squeezed group, per the report.
  • Consumers are either switching to discount brands or stopping discretionary purchases.

Sources (original reporting)

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