Andrea Felsted’s View to 2022: Consumers, Prepare to Tighten Up

(Bloomberg Opinion) -- What to Expect in 2022:

The past year saw a shift in consumer habits that was broadly helpful to the retail sector: Not only did we go to restaurants again and buy more glamorous attire, we also continued to spruce up our homes and shop online. This meant that even with supply chain snarl-ups, most consumer companies had a pretty good 2021. This coming year, we’ll face another big adjustment — but this time it may not be so welcome. Even without the threat of retrenchment due to the omicron variant, shoppers face having to pay more for what they need and not being able to afford what they want. Inflation is ticking up. Borrowing costs are set to rise. And lockdown savings are bound to dwindle. This makes for a much more challenging backdrop when it comes to consumer spending.

From the Year Behind Us:

The Return of Empty Shelves and Panic Buying: Supply chain issues are leaving supermarket shelves empty. Shoppers might yet make things worse. Rising prices and patchy availability of some products mean it’s only a matter of time before people start purchasing in bulk again — this time to avoid future sticker shock.

I’ll Have a Side of Gucci With My Common Prosperity, Please: Common prosperity — the policy directive du jour of President Xi Jinping — won’t banish luxury goods from Chinese malls. But it will usher in a new era where watches are encrusted with fewer diamonds and logos no longer embellish jackets and jewelry.

Rich Millennials Are Splashing Millions on Crypto Art: The pandemic hit the art world hard. But an influx of young, tech-savvy collectors has kept the market buzzing. What are they interested in? Everything from from Beeple to Banksy to Botticelli.

Unilever Must Look Mighty Tasty to Activist Hedge Funds: Breaking up the consumer products conglomerate could be more valuable than keeping its unwieldy portfolio of food, beauty and home brands together. Activist investors have a European target hiding in plain sight.

Victoria’s Secret Stakes $5 Billion on a Future With No Angels: America’s biggest lingerie retailer has a bold new look. Out go the supermodel Angels; in comes the VS Collective, a group of women, including Megan Rapinoe and Priyanka Chopra Jonas, recognized for their accomplishments and opinions. But will the new approach actually sell bras?

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.

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