Consumers: Inflation boosts private label sales

Private label products continue to occupy significant space in consumers‘ cupboards and fridges. The growing trend of private label products seems to attract more and more Greeks.

Vulnerable households, as well as a growing segment of the middle class, are trying to make ends meet by cutting back on all items. According to NielsenIQ, in the context of inflationary pressures, consumers are trying to save money, increasingly choosing private label products, which are generally sold at lower prices than branded products.

Intensifying promotional activities

This, according to NielsenIQ, has led to an increase in their market share, compared to 2021, from +12.7 to +13.6%. Also, retailers and suppliers also seek to maintain or even increase their competitiveness by intensifying in-store promotional activity, which has reached +66.4% for all fast moving consumer goods (FMCGs).

Total sales

As the NielsenIQ research reveals, a 0.9% increase was seen in total sales in value of the organized food retail trade (including food stores over 100 sq.m., mainland Greece & Crete, excluding the islands and the discount outlet market) in the first half of 2022 (YTD data to 19 June 2022), compared to the corresponding period last year.

Growth comes solely from increased prices, as demand shows a negative trend for all major categories, as coded by the company.

Categories

With reference to the course of selected FMCG categories, the trend in value of +0.7% that they note is mainly driven by the categories of food & beverages, which also present the greatest inflationary pressures, at +4.2 %, resulting in sales volumes falling by -2.7%.

However, the individual categories show completely different dynamics.

Indicatively, the categories of olive oil, packaged cheese, and flour are mentioned, the prices of which have increased on average by +22.7%, +9.6% & +9.1% respectively. According to NielsenIQ, the months of May and June have particularly contributed to this increase, which have shown significantly stronger hikes, compared to the first quarter of the year.

The level of prices for the major categories of household care, as well as personal care, has also increased by +3.4% and +2.1% respectively, with the result that consumption has dropped significantly to a rate of -5.3% & -3.6%, also correspondingly. Among the categories that have seen the highest price increases are aluminum foil (+16.7%), but also diapers (+9.0%).