The amount consumers across Europe spent on everyday items, such as food, drinks and toiletries, rose by just 0.2% in the first quarter of 2017 - the lowest level for at least eight years due to the timing of Easter which negatively affected year-on-year comparisons.
Nielsen data on grocery retailers across 21 European countries shows that this 0.2% year-on-year increase in takings at the tills for fast-moving consumer goods (FMCGs) reflected a 0.9% increase in the prices shoppers paid but a -0.7% fall in the volume of items they bought.
“The price inflation figure is what’s important, the low overall sales growth and volume decline is purely a function of the Easter timing,” said Olivier Deschamps, Senior Vice President Retailer Services Europe. “The 0.9% growth in prices paid by shoppers remained stable compared to the 1% across 2016, which indicates there’s little inflationary pressure across the European grocery market.”
Turkey had the highest year-on-year growth in takings at the tills (+11.6%), followed by Slovakia (+3.9%) and Hungary (+3.4%). One of the biggest declines is in Greece (-7.3%) where sales have been negative since the start of 2016 which reflects continued economic challenges and a fall in GDP.
Spain’s growth rate (+2.2%) was the highest among the big five western European markets, followed by Italy (+0.7%). Germany and the UK had the lowest growth among this group (-1.5%), and the third lowest among all 21 countries.
“Most of the Big 5 Western European countries continue to have low growth, particularly Germany and the UK, while the strongest momentum continues to be in Eastern Europe, Portugal and Spain,” says Deschamps.
“In the UK, although inflation returned to the economy overall, the intense supermarket price war has held back grocery inflation as people continue to shop around for savings, visiting more stores more often and spending less on bigger baskets. The consumer mind-set will inevitably move towards uncertainty as Brexit gains momentum but there hasn’t yet been any dramatic change in grocery purchasing behaviour so far this year.”
Unit Value Change = the change in the price paid by a shopper for a unit (item), as a result of price inflation, and/or the shopper substituting a unit of one value for a unit of a different value.
Nominal Value Growth (or the change in takings at the tills) = Unit Value Change + Volume Change
The Nielsen Growth Reporter compares overall market dynamics (value and unit growth) in the FMCG sector across Europe. It is based on the sales measurement that Nielsen performs in 21 European markets, and covers sales in grocery, hypermarket, supermarket, discount and convenience channels. It’s based on the widest possible basket of product categories that are continuously measured by Nielsen in each of these countries and channels.
Nielsen Holdings plc (NYSE: NLSN) is a global performance management company that provides a comprehensive understanding of what consumers Watch and Buy. Nielsen’s Watch segment provides media and advertising clients with Total Audience measurement services across all devices where content — video, audio and text — is consumed. The Buy segment offers consumer packaged goods manufacturers and retailers the industry’s only global view of retail performance measurement. By integrating information from its Watch and Buy segments and other data sources, Nielsen provides its clients with both world-class measurement as well as analytics that help improve performance. Nielsen, an S&P 500 company, has operations in over 100 countries that cover more than 90 percent of the world’s population. www.nielsen.com