Premiumization in the US: What Is Driving Consumer Willingness to Pay More?
Premiumization is no longer about simply charging more for a product positioned as superior. US consumers are looking more closely at what they get for the higher price, whether the difference is noticeable, and whether the product feels worth paying more for.
That is why consumers may still pay more for skincare, wellness products, travel, dining, or functional foods while becoming far more price-conscious in other parts of their spending. The market is becoming increasingly polarized, with premium and value options gaining ground while the mainstream middle faces more pressure. Pasted markdown
For brands, the bigger question is what now drives US consumers’ willingness to pay more. Which products still feel worth trading up for? What makes a premium price feel justified? And where are consumers deciding that the difference simply is not enough?
To understand how premiumization is changing across the US market, and what now makes a premium proposition worth choosing, read on.
How US Consumer Willingness to Pay More Is Changing
US consumers are still willing to trade up, but not across everything they buy. The decision to pay more is becoming more selective, with shoppers weighing where a premium genuinely feels worth it and where a lower-priced option is good enough.
NIQ’s 2026 analysis of the more than $1.1 trillion US FMCG market found that growth is increasingly concentrated at the premium and value ends, while mainstream products are losing share. NIQ describes this as a “barbell” market, where shoppers either pay more for products they believe justify the upgrade or move toward lower-cost alternatives when the difference feels less meaningful.
That makes premiumization trends among US consumers far more dependent on category, benefit, and perceived value. A shopper may pay more for better performance or better experience. In other categories, price may matter more.
For brands, the opportunity is still there. The difference just needs to feel worth the higher price.
Where Consumers Still See Value in Paying More
Premium spending is still holding up in categories where consumers can see a clear reason to spend extra.
Health and wellness are one example. EY’s 2026 US beverage research found that 52% of consumers are willing to pay more for drinks that support their health and wellness goals, while 58% pay closer attention to ingredients. Among Millennials, that willingness rises to 62%, pointing to a stronger link between premium pricing and benefits that feel personally relevant.
Beauty shows a similar pattern. In the first half of 2026, US prestige beauty sales increased 7% to $17.1 billion. Prestige skincare grew 9%, while prestige haircare rose 11%. Fragrance also continued to benefit consumers moving toward higher-concentration and luxury formats.
What stands out across these categories is that the premium is tied to something consumers can recognize, better ingredients, stronger performance, visible results, or a more elevated experience.
That suggests premiumization is not fading so much as becoming more specific. The categories holding up are the ones giving consumers a clear answer to a simple question: what am I getting for the extra money? This is also where consumer willingness to pay becomes most visible.
Who Is Still Choosing Premium in the US
After looking at the categories where consumers are still paying more, the next question is which groups are keeping that demand active.
Income still matters. Market Xcel’s analysis of US consumer spending behavior notes that the top 10% of US households now account for roughly half of total consumer spending, while lower- and middle-income households are more likely to adjust purchases, switch brands, or move toward lower-priced options. That creates very different conditions for premium product buying behavior in the US.
Age can still influence where consumers are willing to spend more, but it is rarely the only factor. What matters just as much is the category itself, how relevant the product or experience feels, and whether the added benefit is strong enough to justify the higher price.
That is why consumer willingness to pay cannot be reduced to a simple younger-versus-older or affluent-versus-value split. Different groups may protect premium spending in very different parts of their budget.
For brands, that makes audience segmentation more important than broad assumptions about affluence. The real opportunity lies in identifying which consumers still see enough relevance, performance, or experience to choose the premium option, and in which categories that willingness is strongest.
Paying More Is Getting Harder to Justify
Consumers may still spend more on the categories they care about most, but the rest of the budget is being watched much more closely.
KPMG’s Summer 2025 Consumer Pulse found that 50% of US consumers were reducing purchases, while 49% were actively looking for discounts and promotions.
That matters because cutting back does not always mean abandoning a category altogether. In many cases, consumers are changing how they buy within it, waiting for promotions, switching brands, choosing smaller pack sizes, or moving toward private-label and lower-priced options.
For premium products, that creates a tougher comparison. A higher-priced option is now being weighed not only against other brands, but against alternatives that may offer enough quality for the job at a lower cost.
The gap becomes harder to defend when the added benefit is small or difficult to notice. Consumers may still protect spending on skincare, wellness, travel, or other areas that feel personally important, while cutting back faster on purchases where the premium feels less meaningful.
So premiumization is not disappearing. It is becoming more concentrated around the products and experiences consumers still feel are worth protecting in their budgets.
What Research Tells Us About Willingness to Pay
As consumers become more careful about where they spend extra, premium brands need more than a higher price point and stronger positioning. They need evidence that the difference is meaningful enough to influence the purchase decision.
That starts with understanding what consumers are actually paying for. In one category, it may be efficacy or ingredients. In another, it could be convenience, service, exclusivity, or a better overall experience. The important part is knowing which of those benefits genuinely increases consumer willingness to pay and where the price begins to feel difficult to justify.
Market Xcel’s CPG market research guide highlights how pricing research can help identify where price resistance begins and how pack size, promotions, and price tiers shape the overall price-value equation.
For premium brands, that moves the conversation beyond finding the highest acceptable price point. The more useful question is which benefits can carry a premium, which audiences are willing to pay for them, and where that willingness starts to weaken.
That brings the discussion back to the central issue: premiumization still has room to grow in the US, but only where the value behind the higher price remains clear enough for consumers to choose it.
Conclusion
The US premium market is becoming more selective. Consumers are still willing to spend more, but only when the difference feels clear and worth it.
Health and wellness, beauty, and experience-led categories continue to see stronger premium demand. Routine purchases face more pressure from promotions, private label, and lower-priced alternatives. Income and age play a role too, but they do not tell the whole story. What matters is how important the product or experience feels to the consumer.
That is why US consumer willingness to pay more now depends less on premium positioning alone and more on relevance, proof, and value.
For brands, the opportunity is still there. The key is understanding what people are actually willing to pay more for and why.
As premium choices become more selective, the brands that understand those differences will be in a better position to price, position, and communicate their offers with more confidence.
That is where research can make the difference.
At Market Xcel, we help brands understand how consumers think about value, price, and premium experiences across categories. Contact us to better understand the psychology behind consumer choices and turn those insights into smarter business decisions.