Nielsen releases consumer survey

A Nielsen study says, 85% of global consumers in an online survey say rising food prices will impact their choice of grocery products. “The challenge for marketers will be introducing new brands and products when food inflation is suppressing the ability for these consumers to grow their shopping baskets.”

“With the global middle class growing by 70 million¹ each year and food prices expected to more than double within 20 years, fast-moving consumer goods (FMCG) companies in many markets are preparing for an unprecedented period of rising demand, economic pressures and aspirationally-driven buying behaviour,” said James Russo, senior vice president, Global Consumer Insights, Nielsen. “FMCG companies focusing solely on consumer income as a barometer of spending habits, however, are unlikely to fulfill their business growth expectations because this is not a middle class only trend. Food inflation impacts all consumer incomes. By looking instead at consumer diversity, spending flexibility and the consumer demand landscape, FMCG companies can better understand real-world buying potential and more accurately scale goods and services to meet the needs of consumers in both developed and developing markets around the world.”

More than 29,000 Internet² respondents in 58 countries were surveyed the Nielsen Global Survey of Inflation Impact.  It served to determine how consumers of different income ranges react to price increases.

Impact of rising food prices on spending

The survey shows that food prices not only impact in-home food products. Areas where all respondents would change their spending include dining out (64%), buying new clothes (55%), spending on snack food (45%), paying for recreation and entertainment (44%) and traveling for vacation (39%).

When asked about likely spending changes to specific food categories, 14% of respondents indicated they would buy more loose, unpackaged, unbranded cereal (such as rice, wheat and grains). About 11% said they would stock up on fresh or frozen fruits and vegetables, and 8% said they would buy more canned fruits and vegetables. More than half of global respondents had no plans to change their spending on staple categories like dairy products (68%), meat and poultry (62%), bread and bakery goods (60%), packaged foods (55%) and fish and seafood (52%). Half of all respondents said they would buy fewer products such as candies, cookies and other sweets (59%), chips and other snack foods (58%), carbonated beverages (53%), alcoholic beverages (49%), prepared meals (48%) and convenience foods (45%).

“Traditional trade is still dominant in many countries, and in these markets, commodity purchases are part of consumers’ daily lives,” said Mr Russo. “The challenge for marketers will be introducing new brands and products when food inflation is suppressing the ability for these consumers to grow their shopping baskets.”

Impact of rising food prices on private label brandsSNEAKERS