U.S. consumers are becoming more selective about their purchases, focusing spending on products they need or strongly want, according to new data from Circana.
Overall retail spending increased 0.8% in August 2026 compared with the same period last year, while unit demand declined 1.7%.
“Consumers are sending a clear message: Value remains paramount, but value is no longer defined by price alone,” said Kiara Barrett, head of global thought leadership at Circana. “Brands and retailers that can deliver both affordability and meaningful benefits, whether through convenience, wellness, innovation, or enjoyment, are best positioned to win.”
Retail food and beverage sales increased 0.2% during the four weeks ending Aug. 29, while unit demand declined 1.8%. Nonedible consumer packaged goods dollar sales increased 1.5%, while units fell 2.2%.
Discretionary general merchandise sales increased 1.4% in dollars, while unit demand was flat compared with the previous year.
Consumers remain active in the marketplace but are becoming more deliberate about when and where they spend. Circana said more back-to-school shopping shifted into August, while changes in the timing of summer retail promotion weeks also affected purchasing patterns. Changes in SNAP benefits are also impacting food and beverage purchases.
According to a recent Circana consumer survey, nearly 60% of shoppers are exercising greater caution or reducing discretionary spending. Another 30% remain selective but continue to spend in categories they consider important.
Most discretionary general merchandise categories continue to face challenged demand. Through Aug. 29, toys and prestige beauty were the only major discretionary categories to record unit growth year over year.
Some categories, however, continue to attract consumers, including frozen desserts, energy drinks, yoga and mat Pilates products, baking tools, beauty products and trading cards. Circana said those categories are benefiting from consumer interest in affordable indulgences, wellness, entertainment and connection.
“Consumers are redefining discretionary spending in such a way that successful brands will need to move beyond competing on price alone,” adds Barrett. “The opportunity lies in helping shoppers justify purchases through meaningful value, emotional benefits, innovation, and experiences that enhance everyday life.”
About Circana
Circana is a leader in providing technology, AI, and data to fast-moving consumer packaged goods companies, durables manufacturers, and retailers seeking to optimize their businesses. Circana’s predictive analytics and technology empower clients to measure their market share, understand the underlying consumer behavior driving it, and accelerate their growth. Circana’s Liquid Data® technology platform is powered by an expansive, high-quality data set and intelligent algorithms trained on six decades of domain expertise. With Circana, clients can take immediate action to future-proof and evolve their growth strategies amid an increasingly complex, fast-paced, and ever-changing economy.
