As inflation continues to affect everyday life, Filipinos have adapted their shopping habits to cope with rising costs, according to reports from the country's largest retail chain, SM Investments Corporation. Despite economic pressures, consumer spending in SM's stores and malls remained steady in the first half of 2026, contributing to a 6% rise in consolidated revenues to P339.2 billion and an 8% increase in net income to P45.9 billion. SM Retail alone saw a net income of P8.9 billion, marking a 5% growth. This resilience comes amid a broader economic slowdown, with GDP growth in the second quarter of 2026 reaching just 2.3%, compared to a 2.8% expansion in household consumption. The shift in consumer behavior is evident in how shoppers approach their purchases. While overall spending remains stable, there are noticeable changes in purchasing patterns. In food retail, the number of transactions has increased, yet the average amount spent per transaction has stayed roughly the same. This suggests that households are making more frequent trips to buy essentials but are managing their budgets carefully. SM Retail President Jonathan Ng noted that “people have to shop, people have to eat,” emphasizing the necessity of grocery shopping despite financial constraints. Conversely, non-food categories show different trends. Transaction volumes remain unchanged, but the average basket size has grown. This indicates that consumers are being more selective when visiting malls and stores, choosing fewer but more expensive items. Ng described this trend as a sign that shoppers are becoming “more intentional” in their decisions, prioritizing value and quality over quantity. To accommodate these changing preferences, SM has introduced a “good, better, best” pricing strategy across its stores. This approach allows customers to choose among different price tiers, ensuring that even with limited disposable income, they can find options that fit their budgets. SMIC President and CEO Frederic DyBuncio explained that prices have been adjusted in line with inflation, which has averaged 5% over seven months, with food, housing, and transportation driving the majority of the increase. Higher fuel costs have also impacted logistics and supplier pricing, further influencing retail costs. Despite these challenges, Filipinos have not entirely abandoned discretionary spending. Specialty retail segments such as home, fashion, and children's products have shown growth, reflecting continued interest in personal and family-related purchases. SM Prime, the company's mall division, reported an 8% increase in mall revenues to P41.8 billion, driven by improved tenant performance and higher occupancy rates. The shift in leisure spending has also been notable, with many families opting for local vacations instead of international travel due to fluctuating fuel prices and a weaker peso. Malls have benefited from this trend, offering air-conditioned environments and diverse dining and entertainment options that encourage extended visits and additional spending. SM Supermalls President Steven Tan highlighted the positive effects of this shift, noting that consumers are increasingly choosing to spend locally rather than abroad. This change in behavior underscores the adaptability of Filipino consumers in the face of economic uncertainty, demonstrating both resilience and strategic decision-making in daily life.
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