Adapting under pressure: Consumer decision-making in times of economic uncertainty and digital transformation

The aim of?this paper is to explore the adaptation process in consumer decision making under economic uncertainty, which relates to inflation, income variability, and digital transformation. Traditional economic theory has a view of consumers as rational actors, striving to maximize utility, but this paper confronts?this understanding and incorporates some insights from behavioral economics and prospect theory. The researchers looked at how demographic and environmental factors, including financial?insecurity, affect consumer behavior in natural settings. The study utilized a?quantitative descriptive research design to collect primary data using an online survey of 400 respondents. Descriptive statistics, Likert scales and cross-tabulations using STATA were used to examine?the relationships between key demographic variables (age, income, employment status, geographic location) and consumer behavioral responses. The research provides evidence that demographic forces affect consumer responses to economic?stress. Specifically, brand switching behaviour of older consumers was more pronounced in the inflationary seasons and middle-income consumers tended to use credit for necessity compared to lower or higher income?classes. Urban consumers also tended to have stronger mobile shopping adaptation compared to?rural customers and students and the unemployed were more likely to rely on the government for assistance in times of economic depression. The current research not only extends the literature on how the economic uncertainty influences consumer behavior, but also offers several important implications for marketers, policy makers, and?financial institutions. The results underline?the importance of personalized actions in favour of the uptake of consumers in tough economic times and technological change. Keywords: Consumer Decision-Making, Economic Uncertainty, Behavioral Economics, Brand Switching, Digital Transformation.