At first glance, consumer spending data might seem like just another economic metric. A number to quote in earnings calls. A trendline to track. But if you know where to look – and how to interpret it – those patterns can reveal deeper truths: not just about the economy, but about what people value, what they fear, and where behavior is headed next.
In this episode of the podcast, we sat down with Michael Gunther, VP and Head of Insights at Consumer Edge, to dig into spending trends and what they signal for brands, markets, and strategy. The conversation took place earlier this year, and it’s important to note that the economic environment has shifted since then. But the bigger ideas we explored – the lenses, frameworks, and behavioral patterns – remain relevant. In fact, they may be even more useful now as uncertainty deepens and historical norms continue to break.
This isn’t a news recap. It’s a guide to understanding how to read the market when the signals are mixed, the headlines are noisy, and old playbooks don’t quite work anymore.
The Art (and Risk) of Interpreting Consumer Behavior
One of the most dangerous assumptions you can make in business is that consumer behavior follows clean, linear logic. It doesn’t. It reacts. It absorbs. It compensates. And more often than not, it contradicts itself in the process.
For example: people cutting back on discretionary purchases but still spending on luxury resale. Or skipping grocery splurges but upgrading their wardrobe basics. These aren’t irrational decisions – they’re recalibrations. And if you’re watching the wrong metrics, you’ll miss them entirely.
As Michael pointed out in our conversation, consumer data needs context. The same movement – a rise in discount spending, for example – can mean very different things depending on where it’s happening, who’s doing it, and what else is happening in adjacent categories. Smart companies know how to read between the lines. 
What Spending Categories Signal (and What They Don’t)
Too often, retail and eCommerce reports get reduced to surface-level takeaways: “Consumers are trading down.” “Luxury is holding steady.” “Resale is surging.” These may be technically true, but they rarely explain why those things are happening – or what they mean next.
In our discussion, we explored a more nuanced view of key categories:
- Fast fashion and resale often surge when consumers grow price-sensitive – but these same categories are also powered by social influence, micro-trends, and sustainability narratives. Is the growth here a matter of affordability, or alignment with deeper values?
- Luxury and near-luxury tend to defy gravity longer than other sectors – but eventually feel the effects of consumer fatigue, even among affluent buyers. Brands in this space often depend heavily on perception: maintaining a sense of timeless value even in volatile times.
- Discount and off-price retail provide early indicators of belt-tightening – but also face compression as shoppers demand more for less. Price isn’t the only variable; perceived quality and reliability matter more than ever when budgets are tight.
These categories act as signals – but only if you consider the full picture. Too often, brands overreact to one data point and miss the broader shifts underneath.
When the Past Isn’t a Map
One recurring theme from our conversation was this: the consumer patterns we’re seeing now don’t fit neatly into historical analogues. Post-pandemic rebounds, inflation shocks, political uncertainty, and social realignments have created a strange brew. It’s not 2008. It’s not 2020. It’s something else entirely.
For example, the post-COVID spending surge didn’t follow traditional recovery logic. Consumers spent big – but not evenly. They prioritized experience, escape, and identity over traditional value hierarchies. That left some sectors surging and others stalling, with little explanation other than psychology.
Now, that wave is settling. The savings buffers are thinner. Debt levels are rising. And new pressures – tariff talk, supply chain instability, political polarization – are making people hesitate. Not necessarily panic. But pause. And that pause can be deadly for categories that rely on habitual purchases or impulse behavior.
In this kind of environment, relying solely on year-over-year comparisons or historic benchmarks won’t cut it. You need behavioral fluency.
Four Questions Every Brand Should Be Asking Now
Instead of chasing signals in real-time, brands would do well to slow down and ask sharper questions. The kind that reveal not just what’s happening, but why – and what to do about it. Here are four we discussed during the episode that remain critical:
- What emotional need are we solving right now?
- Is it comfort, escape, belonging, achievement, reliability? That answer may have changed in the last six months – and your messaging might need to catch up.
- Are we assuming loyalty that no longer exists?
- In a downturn, loyalty becomes highly transactional. Brands that mistake past performance for current relevance risk losing share fast.
- Where are our customers trading down – or trading off?
- Don’t just look at your competitors. Look at adjacent categories. If someone chooses Netflix over new clothes this month, that’s not your direct rival – but it is your lost revenue.
- Are we speaking to today’s mood, or yesterday’s market?
- Brand tone, creative, and offers all need recalibration. Even subtle mismatches in tone (“celebration” vs. “reassurance”) can alienate a stressed-out buyer.
Resilience Isn’t Luck – It’s Strategy
Some brands will do just fine. Others will emerge stronger. But it won’t be by accident.
In our discussion, Michael highlighted a few categories and players demonstrating resilience – not because they avoided the storm, but because they designed for it:
- Brands with clear value tiers – from Quince’s luxury-at-access pricing to Farfetch’s curated premium experience – are giving consumers something worth stretching for.
- Platforms that align with identity or purpose, like Depop (youth, sustainability, creativity), continue to grow even when the broader market pulls back.
- High-trust, low-friction players are winning when consumers hesitate. Clear return policies, strong product guarantees, and smart UX aren’t just hygiene – they’re performance drivers now.
Resilience doesn’t mean doing everything. It means doing the right things – and being ruthless about focus.
The Role of Psychology (and Why It’s Often Underestimated)
If you strip away the spreadsheets, the truth is this: consumer confidence is psychology, not math. And right now, that psychology is fragile.
Tariff speculation. Interest rate fatigue. Election noise. Unstable pricing in essentials like groceries. It all adds up to one thing: a sense of unease. And unease doesn’t just affect big-ticket items. It ripples through everyday choices, slowly constricting the field of what feels “safe” to buy.
Brands that understand this – really understand it – will adjust not just their offers, but their tone, timing, and storytelling. They’ll use empathy as a strategic asset. Not as window dressing.
A Final Note: This Isn’t About Panic. It’s About Precision.
If there’s one takeaway from our conversation with Michael Gunther, it’s this: consumer behavior doesn’t lie – but it doesrequire interpretation. Especially now.
This episode may have been recorded when the signals looked a little different, but the methods we discussed still hold. Look past the headlines. Read between the receipts. Focus on behavior, not noise. And above all, plan for a market shaped by caution, complexity, and rapidly shifting expectations.
In other words: don’t just ask what people are buying. Ask why they’re still buying anything at all.
