The Global Economic Crisis: The Impact On Consumer Attitudes & Behaviors In France

Published by: Datamonitor

Published: Jul. 24, 2009 - 16 Pages

Table of Contents

Overview

Catalyst

Summary

THE FUTURE DECODED

INTRODUCTION: Understanding how 'recessionary mindsets' influence French people's attitudes towards and actual consumption is vital

The 'recessionary mindset' of French consumers is reflected by the widespread belief that they are in a recession

The economic downturn has had an impact on the lifestyles of more than half of French consumers

Key takeouts and implications: a 'recessionary mindset' has not yet been fully matched by a recessionary impact on French consumers' lifestyles

TREND: Low consumer confidence is reflected by a generally negative outlook among French consumers about the general direction of the country

French people have mixed feelings about their quality of life despite being discontent about the country's overall direction

Key takeouts and implications: French consumers' mood towards the direction of the country has dampened slightly but they remain relatively upbeat of their quality of life

TREND: French consumers have lost confidence in their financial security and are being more scrupulous in response

Satisfaction with one's financial situation is low among French consumers

Perceptions about the economy, job security, financial status and the housing market in France are all negative and there is only limited optimism for the six months ahead

French consumers are managing their finances more closely with some even struggling to pay the bills

French consumers are making greater efforts to save and still aspire to be less reluctant on credit

Key takeouts and implications: French consumers have lost satisfaction in their financial situation and there appears to be little optimism of any improvement coming towards the end of 2009

INSIGHT: The global economic crisis has had a negative impact on the emotional wellbeing of French people with levels of stress up and personal happiness down

Stress levels have all been negatively impacted during the financial downturn

Work-life balance has also worsened in combination with the deepening downturn

The happiness levels of French citizens have declined in line with the global economic crisis

Key takeouts and implications: French consumers have lost satisfaction in their financial situation and there is only mild optimism of any improvement coming towards the end of 2009

INSIGHT: French consumers have become increasingly price and value conscious following the global economic downturn

French consumers are becoming more value conscious and therefore are looking to save money when buying groceries

Price consciousness heavily influences where French consumers do their grocery shopping and how they shop but quality is even more important

Key takeouts and implications: the general value consciousness of French consumers has intensified and is reflected by how they determine where to shop

INSIGHT: Brand loyalties are under increasing threat as French shoppers give up brands and increasingly embrace private label

French consumers are beginning to give up some of their favorite brands more so than their global counterparts, as they make more 'considered' consumption choices

Private labels are becoming more attractive to French shoppers in the downturn

Key takeouts and implications: the general value-for-money approach of French consumers, combined with their current reflective consumption patterns, should create an optimal platform for private label growth

INSIGHT: French consumers are embracing money saving tactics when it comes to food and non-alcoholic beverage purchases and preparation

French consumers are adopting various responses to cut back on food and beverage expenditures, particularly preparing more meals at home

A high proportion of French shoppers consider private label food and non-alcoholic beverages to be identical to famous branded equivalents but the majority favors famous brands

Key takeouts and implications: a resurgent desire to cook more often at home has occurred while private label and market leading brand competition in food and non-alcoholic beverages will intensify

INSIGHT: The significant majority of French consumers' personal care regimes and related product choices have been 'recession resistant'

Almost half of French consumers are committed to looking their best in day-to-day life

Price and value conscious personal care/beauty shoppers in France so far have not made notable changes to their personal care shopping and usage in order to save money

French consumers take a balanced and apparently informed approach to private label personal care products

Key takeouts and implications: French consumers' health and beauty regimes are proving to be largely recession resistant

INSIGHT: French consumers' alcohol consumption patterns and preferences have not changed significantly during the downturn

French drinkers are careful about how much they spend on alcohol, but do not perceive that they have been making significant cut backs in the amount they consume

French drinkers appear to have become more value conscious in their at-home alcoholic beverage choices than their out-of-home choices

Private label alcohol is commonplace in France, but this does little to diminish the less favorable perceptions of such drinks

French drinkers value the quality credentials of alcoholic beverage brands above brand image and related attributes

Key takeouts and implications: there has been little to no change in habits and preferences for two thirds of French drinkers, suggesting that alcohol is largely 'recession resistant'

INSIGHT: French consumers' household care buying preferences are heavily shaped by price consciousness irrespective of an economic downturn

Price led value is still the most influential factor for French consumers' household and laundry care purchases, but preferences do reflect other important influences

The private label household care market in France is relatively small but potentially lucrative given shoppers' desire for value

Key takeouts and implications: French consumers strongly associate hygiene and cleanliness with wellbeing and this, combined with their inherent dislike of household chores, is bound to make them somewhat quality conscious

ACTION POINTS

ACTION: Adopt a relentless approach to delivering and communicating better value-for-money than the competition

Actively demonstrate value-for-money by re-appraising marketing initiatives, including slogans

Re-appraise loyalty card schemes

Help customers with practical solutions

Focus on quality to maintain differentiation and prove to consumers that quality really matters

Evaluate and adapt cost structures so that it is feasible to offer value-for-money solutions

Start planning for the longer-term by continually tracking French consumers as an economic recovery begins to become a reality

APPENDIX

Methodology

Further reading and references

Ask the analyst

Datamonitor consulting

Disclaimer

List of Tables

Table 1: Consumer survey: level of satisfaction with the general direction of how things are going and quality of life, in France (compared with the global average), 2009

Table 2: Consumer survey: satisfaction with current financial situation and importance attached to wealth/ income and having finances in good order, in France (compared with the global average), 2009

Table 3: Consumer survey: perceptions of whether broader economic conditions, household's financial situation, job security/confidence and housing market confidence had improved or worsened in the six month previous and how each might change in the proceeding six months, in France, 2009

Table 4: Consumer survey: propensity to feel tense and the extent to which perceived levels of stress have changed in the last six months and are expected to change in the next six months, in France, 2008-09

Table 5: Consumer survey: propensity to feel very tired and the extent to which perceived work-life balance has changed in the last six months and are expected to change in the next six months, in France

Table 6: Consumer survey: happiness levels and the extent to which perceived happiness has changed in the last six months and are expected to change in the next six months, in France, 2008-09

Table 7: Consumer survey: changing value-consciousness and desire to save money when buying groceries among French shoppers, 2009

Table 8: Consumer survey: changing efforts being made to use coupons, change grocery store choice to save money, embrace more disciplined shopping and gather and utilize store price information, among French shoppers, April 2008-April 2009

Table 9: Consumer survey: the relative cost/value and quality consciousness of French and global consumers overall when purchasing food and beverage products in 2008

Table 10: Consumer survey: the extent to which French consumers are making effort to save money by adopting various food and drinks consumption and preparation approaches, 2008-09

Table 11: Consumer survey: perception about the relative superiority or inferiority of private labels versus well known or market leading famous brands in food, soft drinks and hot drinks, in France, 2009

Table 12: Private label food penetration and spend ($ millions) in France, 2002-2012

Table 13: Private label non-alcoholic beverage penetration and spend ($ millions) in France, 2002-2012

Table 14: Consumer survey: the importance attached to looking one's best in day-to-day life, the pressure to look good, and satisfaction with physical attractiveness/ appearance, among French consumers, 2008 and 2009

Table 15: Consumer survey: the extent to which consumers are making an effort to save money by using spas or salons less often, in France, 2008-09

Table 16: Consumer survey: attempts made by French consumers to change their personal care/beauty habits in order to save money, by product category, 2008-09

Table 17: Private label personal care penetration and spend ($ millions) in France, 2002-2012

Table 18: Consumer survey: perception about the relative superiority or inferiority of private labels versus well known or market leading famous brands for grooming/ beauty products, and agreement that such products are good alternatives to well known or market leading famous brands, in France, 2009

Table 19: Consumer survey: attentiveness towards the amount of money spent on alcohol and the degree to which alcoholic beverage consumers in France have cut down on the overall amount of alcohol bought/consumed in 2008-09

Table 20: Total private label alcoholic beverage penetration and spend ($ millions) in France, 2002-2012

Table 21: Consumer survey: the degree to which household and laundry care consumers in France have cut down on the overall amount of alcohol bought/consumed in 2008-09

Table 22: Consumer survey: French attitudes towards doing housework, 2008

Table 23: Private label household care penetration and spend ($m) in France, 2002-2012

Table 24: Consumer survey: perception about the relative superiority or inferiority of private labels versus well known or market leading famous brands for household cleaning/laundry products, and how often such products are purchased to save money, in France, 2009

List of Figures

Figure 1: Datamonitor's Recession and Recovery portal will allow industry players to continually identify emerging opportunities and track what is happening in the French economy as it develops

Figure 2: Almost three-quarters of French consumers believe the country is in recession

Figure 3: One-in-four French consumers feels that their lifestyle has not changed in light of the downturn

Figure 4: From a personal perspective, European and US individuals generally looked at 2008 negatively, but to a lesser extent in Germany

Figure 5: French people are anxious about the direction their country is taking but their perceptions on quality of life are more equivocal

Figure 6: Nearly a half of French consumers are currently dissatisfied with their financial situation

Figure 7: French consumers' negativity about the economy in general is greater than that shown towards their personal economic situation

Figure 8: Only 10% of French consumers expect economic conditions to improve in the period April 2009 through to October 2009 and only 9% think the same about the housing market

Figure 9: Consumers in most major economies in Western Europe and the US, including France, anticipate being less well off going into 2010

Figure 10: French consumers are managing their finances more closely while almost one third of individuals report difficulties in paying all the bills

Figure 11: French consumers are generally reluctant to sustain their reliance on credit and express an increasing desire to save money

Figure 12: The economic downturn has also been accompanied by additional stress levels among French consumers

Figure 13: French consumers are less prone to fatigue than many, but one-quarter has experienced a worsening work-life balance in the period October 2008 to April 2009

Figure 14: Nearly one in five French citizens became less happy during the period October 2008 to April 2009

Figure 15: The overwhelming majority of French consumers are more value conscious following the downturn

Figure 16: Quality of products sold has more influence than lower prices or habit over where people in France do their grocery shopping

Figure 17: Price and value consciousness is influencing where French consumers do their grocery shopping and how they shop

Figure 18: As the downturn has intensified, so too has the extent to which French consumers have been forced to sacrifice some of their favorite brands

Figure 19: Private label range plays a role in where people shop, not just in France, but globally

Figure 20: Almost three-fifths of French shoppers are routinely buying private label/store branded products in an effort to save money

Figure 21: Monoprix's private label advertising seeks to leverage more than just low price

Figure 22: The private label market is impacted by a broad range of drivers and inhibitors

Figure 23: French consumers became increasingly value conscious in their food and beverage choices in 2008, but that was not reflected by a substantial quality compromise

Figure 24: The attributes deemed most influential in what food and beverages French consumers buy also highlight the price consciousness shaping the choices they make

Figure 25: French consumers are adopting various responses to cut back on food and beverage expenditures

Figure 26: There has been little change in the propensity for French consumers to have a takeaway meal at home, but slightly fewer are have been doing so on a daily basis in 2008-09

Figure 27: French consumers' opinions about how famous branded food products, soft drinks and hot drinks compare to private label equivalents favor famous brands

Figure 28: French consumers are appearance conscious and this makes them less willing to trade-down when making personal care choices

Figure 29: French personal care/beauty shoppers became more price and value conscious in 2008, but showed little desire to sacrifice on quality

Figure 30: Personal care/beauty shoppers in France and elsewhere are highly price conscious

Figure 31: More than one-third of French consumers consider private label beauty products to be good alternatives to well known or market leading brands

Figure 32: French consumers are careful about how much they spend on alcohol, but do not perceive that they have been making significant cut bucks in the amount they consume

Figure 33: Value consciousness among French drinkers has had more impact on at-home alcoholic drinks' consumption in 2008-09

Figure 34: French drinkers, perhaps influenced by cultural inertia, are reluctant to opt for cheaper brands and formats of alcoholic beverages

Figure 35: More than one-third of French drinkers are highly influenced by alcohol promotional offers

Figure 36: Almost one third of French drinkers believe that private label alcoholic drinks are good alternatives to market leading or famous brands

Figure 37: Many French consumers admit to having no experience to compare private label with famous brand alcohol beverages

Figure 38: Although French drinkers are price conscious, brand name (as opposed to brand image) has become a strong influence on purchase preferences

Figure 39: Price led value is still the most influential factor for French consumers' household and laundry care purchases

Figure 40: In 2008, French household and laundry care choices were made with greater consideration for cost/ value but consumers showed an ongoing desire for efficacy led quality

Figure 41: More than two-thirds of French consumers are 'frequent' purchasers of household care products on the basis of value-for-money

Figure 42: French consumers value cleanliness, inherently dislike household tasks and seek to minimize the amount of time they spend on such tasks

Figure 43: Just over two in five French consumers regularly purchases private label household care products to save money

Figure 44: A small proportion of French consumers consider private label household and laundry products to be superior to branded equivalents

Figure 45: Carrefour's Discount range is positioned as a range to make customers feel 'very important'

Figure 46: Carrefour also offers multi-buy offers in addition to its value range

Figure 47: Supermarché Mousquetaire is taking a light-hearted approach to value pricing

Figure 48: ATAC supermarkets are helping customers with value recipe suggestions

Figure 49: Lidl is keen to reinforce its private label discount lead in France

Figure 50: Manufacturers and retailers looking to deliver value-for-money must in the provision of factors associated with the PPI, but while also offering consumers lower than expected prices

Figure 51: Datamonitor's Recession and Recovery portal will facilitate forward thinking planning for those leading companies that start planning for the longer-term

Abstract

• Detailed analysis documenting French consumers' 'recessionary mindset' and how this influences perceptions about current and future prospects
• Insights highlighting how the economic downturn has affected perceived quality of life, emotional wellbeing and financial security in Franc
• In-depth analysis of French shoppers' changing price sensitivity, value consciousness and attitudes towards private label across 4 major FMCG sectors
• Countries and categories covered: France; food and non-alcoholic beverages, alcoholic beverages, personal care and household care

• Gain a detailed understanding of changing consumer attitudes and behaviors amid the downturn in order to determine appropriate recessionary strategies
• Obtain country and sector specific insight about pertinent recessionary themes such as private label and consumers' value consciousness
• Assist consumer segmentation and targeting efforts by accessing data from two waves of primary research conducted in August 2008 and April 2009

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