New consumer research from Manhattan Associates has revealed that while Australians remain cautious about big-ticket spending due to cost-of-living pressures, easing interest rates are beginning to lift confidence and create opportunities for retail recovery.

The survey found that 72% of Australians have currently delayed major purchases due to economic uncertainty. Yet despite this caution, the research shows the outlook is still optimistic. A significant 70% of consumers indicated they would increase spending if interest rates continued to fall, a signal that retailers may soon see a release of pent-up demand.

“Consumers are understandably cautious after a long period of high interest rates and rising costs,” said Raghav Sibal, Vice President, APAC at Manhattan Associates.

“But the data shows they are not permanently withdrawing from the market. Instead, they are waiting for the right signals, such as rate relief and stable prices, before resuming larger purchases. That presents both a challenge and an opportunity for retailers.”

Shoppers want stability and value

The research revealed that retailer promotions are more likely to influence Australians’ willingness to spend than further economic intervention. More than a third of consumers (36%) said promotions and discounts would encourage additional spending, while 34% said stable product pricing would give them confidence to shop more. By contrast, only 16% said further rate cuts alone would drive them back to stores.

For retailers, this insight highlights the power of pricing strategies, loyalty programs and customer-centric offers to influence behaviour in the short term, even while broader economic conditions are still evolving.

“Retailers shouldn’t sit back and wait for conditions to improve,” Mr Sibal said.

“Australians are telling us they want value and predictability. Transparent pricing, compelling promotions, and seamless service will be critical to building trust and encouraging people to spend again.”

Retailers urged to prepare now

For retailer, agility will be key explained Mr Sibal.

“Consumers will return, but they’ll do so with sharper expectations. They want retailers who can adapt quickly, whether that’s ensuring the right product availability, offering seamless online-to-offline experiences, or providing meaningful value at the checkout. Retailers who can deliver on all of these fronts will ride the recovery and secure long-term loyalty.”

The findings highlight an urgent need for retailers to focus on supply chain resilience and unified commerce strategies. By better connecting inventory, pricing, and customer engagement across channels, retailers can ensure they are well-placed to capture demand when shoppers re-enter the market.

“Resilient supply chains and unified retail experiences are essential,” Mr Sibal said. “Australian consumers have shown they are waiting for the right moment to spend again. Those retailers who act decisively now to improve operations will be the ones who benefit most when confidence returns.”