The Joy Economy: Why Consumers Are Trading Basics for Big-Ticket Purchases in 2025

Despite their plans to cut back, consumers aren’t tightening their belts – they’re strategically reallocating their spending. McKinsey’s latest ConsumerWise Research reveals a fascinating trend: while people say they intend to reduce spending across most categories, actual consumption data tells a different story. They’re making calculated trade-offs, cutting back on basics to make room for joy-sparking purchases and memorable experiences. This shift in consumer behavior presents challenges and opportunities for brands seeking to capture wallet share.

Data Key Takeaways: 

Consumers continue to spend even if they don’t plan for it. High-ticket items like flights and home decor led with 8% growth, followed by electronics at 6%, while categories like hotels, jewelry, and furniture all grew by 5%. This growth occurred despite strongly negative purchase intentions – for instance, consumers said they would reduce spending on furniture by 32% and home decor by 35%. Meanwhile, basic categories like groceries and restaurants remained flat, suggesting consumers maintain essential spending while increasing their splurges on discretionary items.

Stories from our Lens Library offer context on a few ways consumers navigate spending and how brands can respond.

1 | DIY cost savings: “I try to see where I can cut back by maybe doing it myself, like some self-care instead of, you know, going in to get service for it professionally. I try to learn things on my own. I think that’s the best way to save in any way possible by doing things on your own, and that’s anything.”

Brand Implication: Lean into how-to-do-it-yourself content, especially around elevated at-home meals or self-care.

2 | Reward themselves: “I feel like it kind of just made me realize that now that I’m making my own money, why not just spend some of it on myself? Just to at least enjoy what I work hard for.”

Brand Implication: Invest in experiences or surprise perks that make the purchase worth the splurge and more rewarding.

3 | Prioritize Unique and Memorable: “So if something is new or unique, like maybe a new food item or a new restaurant that I’ve wanted to try, or something that I can’t get at home. Is this something I will remember a week from now, or am I just going to kind of forget in the moment and it won’t have been a big deal then? So I try to rein myself in a little bit and make sure that I’m treating myself, but I’m not just wasting money because I think there’s a very thin line there with some things.”

Brand Implications: Showcase the new and unique and deliver on making it memorable, especially in the travel and hospitality space.

4 | Understand your online footprint: “So, I was so caught up in having the cutest, latest refrigerator. But once I started reading those reviews and it’s such a new technology that I know of on refrigerators, there’s a lot of kinks to be fixed, right? So, after I read the reviews and stuff like that, I came back to my senses and got a regular old trusty refrigerator, two-door refrigerator, no screen on it.”

Brand Implications: Build content to help consumers trust your offering and address negative reviews head-on. 

So far, consumers want to keep spending, but you need to give them solid reasons to spend on your brand. Among our 250 Lens Library members, we are seeing key income, cultural, and location differences emerge that add even more complexity to navigating an already rocky start to consumer confidence 2025. 

Count on us to add context, strategic insights, and brand implications to trending news to help you take on 2025 challenges with more data.

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