As inflation continues to squeeze household budgets, with consumer prices rising by 8.5%, American shoppers have made "saving money" their top priority. Yet contrary to expectations, the retail market hasn't collapsed. Savvy merchants are discovering that by understanding shifting consumer psychology and adapting their strategies, they can uncover new growth opportunities even in challenging economic conditions. This analysis focuses on two key categories—toys and beauty products—to reveal emerging trends that cross-border e-commerce sellers should note.
E-Commerce: The Inflation-Era Safe Haven
With prices soaring, consumers have become more deliberate in their spending, comparing options more carefully than ever. Online platforms, offering both variety and price transparency, have emerged as the preferred shopping destination. U.S. Commerce Department data confirms this shift: after surging nearly 50% during the pandemic's early days, e-commerce spending has maintained steady growth. In Q2 of this year, online sales reached $252.14 billion, up 7.3% year-over-year—outpacing physical stores for the first time. Today, more than $1 of every $5 in retail spending flows through digital channels, accounting for 20% of total sales.
Spending Priorities: Essentials First, But Self-Care Endures
Inflation has visibly reshaped consumption patterns, with clothing, footwear, beauty products, and back-to-school items dominating budgets. Health concerns during the pandemic also boosted demand for fitness and wellness goods. Surprisingly, however, "self-care" spending hasn't significantly declined. According to NPD Group, high-income U.S. households spent nearly $9 billion on beauty products in the first half of the year, a 14% increase. Generation X and millennial consumers are driving this trend, maintaining consistent usage while trading up to premium products. This suggests that even under financial strain, the desire for quality-of-life purchases persists.
Toys: Online Channels Fuel Growth
The toy category saw sales rise 2% year-over-year in the first half of 2023. While this growth pales next to the pandemic-era spikes of 18% (2020) and 20% (2021), it demonstrates remarkable resilience given inflationary pressures. Notably, online sales are accelerating faster than overall growth. Industry experts predict toys will outperform other general merchandise categories in the latter half of the year—a clear signal for e-commerce sellers to prioritize digital channels.
Back-to-School: Social Media Drives Promotional Success
Beyond Black Friday and Christmas, back-to-school season remains a critical sales period. The National Retail Federation projects U.S. spending could match last year's record $37 billion, averaging $864 per family. Though inflation has led half of parents to plan cutbacks—focusing mostly on essentials—retailers are responding aggressively. Major chains have amplified marketing efforts, turning to Facebook and TikTok livestreams to attract shoppers. Examples include Dick's Sporting Goods hosting Snapchat shopping events, Macy's targeting core audiences via TikTok, and Walmart combining livestreams with back-to-school fashion showcases. These cases prove that social media-driven campaigns can effectively boost seasonal sales.
Pet Products: Standing Out in a Crowded Market
With National Dog Day (August 26) approaching, pet-related searches—for food, beds, collars, toys, and treats—typically surge in Western markets. But this sector is fiercely competitive, dominated by global brands and established domestic sellers like Tianyuan Pet and Yuanfei Pet. To compete, merchants must identify niche segments—such as smart pet tech, health-focused foods, or customized services—and pair them with tailored marketing strategies.
Conclusion: Adapting to Consumer Psychology
In a volatile market, cross-border sellers must stay attuned to shifting trends and adjust strategies accordingly. During inflationary periods, understanding psychological needs becomes especially critical. Delivering high-value, quality products and experiences will separate winners from competitors. Agility and consumer insight are the ultimate keys to sustainable growth.