Behind the scenes
Galaxus customers making fewer climate contributions
by Tobias Heller
Inflation: one in two comparing prices more often
22.7.2022
Translation: Jessica Johnson-Ferguson
Inflation’s on the rise, which is why half of Switzerland’s inhabitants now compare prices more frequently. French-speaking Switzerland and lower income groups are reacting to developments the strongest. They’re the ones who are expecting the fast-rising cost of living. This was revealed by a representative survey carried out for Digitec Galaxus. Admittedly, the range of prices isn’t diverging yet – at least not on the internet.
Inflation is when you pay 50 francs for a 40-franc haircut you got for 30 francs when you still had hair. After three decades of stable prices, inflation is also making a comeback in this country. Switzerland has sailed through the waves of inflation more smoothly than all other European countries so far thanks to the strong Swiss franc. However, the Swiss population is still concerned.
According to a representative survey conducted by market research institute GfK on behalf of Digitec Galaxus, over half of Switzerland’s residents are expecting prices to go up by 2 to 5 per cent this year. One in six even expects inflation rates to exceed the 5 per cent mark. For comparison, experts at ETH’s Swiss Economic Institute KOF predict average inflation of 2.6 per cent (document in German) for the current year. In June, the prediction was 3.4 per cent.
According to the survey, it’s elderly people in particular, who are pessimistic: just under a quarter of people believe inflation of 5 per cent is to be expected this year. No wonder, given that they remember the impact of high inflation in the 1970s and 1990s. The outlook of respondents from the French-speaking part of Switzerland as well as those from lower income groups is less optimistic. Inflation hits the latter harder than average because heating oil, gas, gasoline or diesel account for a larger share of their household budgets. In Germany and Austria, the majority of respondents has come to terms with inflation rates of over 5 per cent.
Price bots pruning the price jungle
The Swiss population is responding to rising prices by comparing deals more often. One in two respondents said they now paid more attention to fuel prices before filling up the car, searched for the cheapest flight before booking a beach holiday or opened two dozen tabs before popping those diapers on special offer in their cart – classic economising.
Inhabitants of French-speaking Switzerland and lower income groups are particularly influenced by the expected inflation. There, 6 out of 10 respondents said they now compare offers more often. The same applies to respondents with a gross monthly household income of under 7,000 francs. Across the border in Germany and Austria, an impressive 8 out of 10 respondents now compare prices more often.
However, at least when it comes to shopping online, the price increase doesn’t mean that the range of prices will become wider: «Prices for toothbrushes, cat food or mobiles are so dynamic and easy to compare online that retailers can’t just pass on the higher prices to their customers directly,» says Hendrik Blijdenstein, who’s in charge of purchases and sales as Chief Commercial Officer at Galaxus. «If someone still tried to pull this off, they’d be left sitting on their goods.» One exception is scarce goods: For example, recent months have seen large price differences for graphics cards or game consoles.
There’s no time like the present
14 in 100 survey respondents also stated they’d be buying things earlier because they expect prices to rise. This is particularly true in young people, men and shoppers in the French-speaking part of Switzerland. The logic behind this shopping behaviour? If a pack of muesli bars costs 10 francs today and potentially 12 by the end of the year, you’re best off stocking up now. In Germany and Austria, one in four shoppers are already applying this idea.
How are you reacting to the rising prices? Are you busy knitting woolly socks because heating costs will be through the roof in winter? Are you making pre-emptive purchases? Are you bored by reports on the inflation? Join the discussion in the comments section!
Alex Hämmerli
Senior Public Relations Manager
Alex.Haemmerli@digitecgalaxus.chAt Digitec and Galaxus, I’m in charge of communication with journalists and bloggers. Good stories are my passion – I am always up to date.
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