Introduction
82% of Spanish consumers believe that they are currently living in a recession. This is indicative of an intensifying 'recessionary mindset' influencing consumer behavior. Symptomatic of falling consumer confidence is the fact that more than four-in-ten Spanish consumers experienced a worsening financial situation, falling job security and falling confidence in the housing industry in 2008-09.
Scope
*Detailed analysis documenting Spanish 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 Spain
*In-depth analysis of Spanish shoppers' changing price sensitivity, value consciousness and attitudes towards private label across 4 major FMCG segments
*Countries and segments covered: Spain; food and non-alcoholic beverages, alcoholic beverages, personal care and household care
Key Market Facts
53% of Spanish consumers feel that their lifestyle has been impacted by the recession. Suddenly, they have been forced to re-evaluate their spending, including where they do their grocery shopping as well as their in-store choices
55% of Spanish shoppers are 'frequent buyers' of private label products. Many are now likely to consider private label products to be on a par, if not better than industry leading brands across segments
For two thirds of Spanish shoppers, lower prices have a high amount of influence over where people do their shopping. Nevertheless, the quality of products sold has more influence over their (changeable) grocery shopping destinations. This is symptomatic of the intensifying value-consciousness across FMCG product segments
Why Should You Buy This Report?
*Gain a detailed understanding of changing consumer attitudes and behaviors amid the downturn in order to determine appropriate recessionary strategies
*Obtain country and segment specific insight about pertinent recessionary themes such as private label and consumers' value consciousness
*Assist consumer key market segments and targeting efforts by accessing data from two waves of primary research conducted in August 2008 and April 2009
Consumer Trends Industry in Spain
Overview 1
Catalyst 1
Summary 1
Data table of Contents 2
Data table of figures 3
Data table of tables 4
THE FUTURE DECODED 5
INTRODUCTION: Understanding how 'recessionary mindsets' influence Spaniards' attitudes towards and actual consumption is vital 5
Economic experts believe that the Spanish economy is trapped in an unfavorable situation with poor conditions for recovery 5
The 'recessionary mindset' of Spanish consumers is reflected by the widespread belief that they're in a recession 6
The economic downturn has had an impact on the lifestyles of more than half of Spanish consumers 7
Key takeouts and implications: a 'recessionary mindset' has not yet been fully matched by a recessionary impact on Spaniards' lifestyles 8
TREND: Spanish consumers are adopting a negative outlook about the country's direction but are more content with their quality of life 8
Spaniards are polarized about their quality of life and have a genuine feeling of disgruntlement about the direction of events in Spain 8
Key takeouts and implications: Spaniards are highly skeptical about the direction of events in Spain but they remain upbeat of their quality of life, more so than in other nations 11
TREND: Spanish consumers have lost confidence in their financial security and are being more prudent in response 11
Satisfaction with one's financial situation is low among Spanish consumers, but they are less motivated by material wealth 12
Perceptions about the economy, job security, financial status and the housing industry in Spain have all worsened with little cause for optimism in the short term 13
Spaniards are managing their finances more closely with some even struggling to pay the bills 17
Spaniards are making greater efforts to save and still aspire to be less reluctant on credit 18
Key takeouts and implications: Spaniards have lost satisfaction in their financial situation and there is much pessimism and polarized opinion about any improvement coming towards the end of 2009 19
INSIGHT: The global economic crisis has had a negative impact on the emotional wellbeing of Spaniards with levels of stress up and personal happiness down 20
Stress levels have all been negatively impacted during the financial downturn 20
Work-life balance has also worsened in combination with the deepening downturn 22
The happiness levels of Spanish citizens have declined in line with the global economic crisis 24
Key takeouts and implications: Spaniards have lost satisfaction in their financial situation and it is having an impact on happiness and well-being 26
INSIGHT: Spanish consumers have become increasingly price and value conscious following the global economic downturn 27
Spanish consumers are becoming more value conscious and therefore looking to save money when buying groceries 27
Value-for-money (the combination of product quality and an appealing price point) is vital for Spanish consumers when they are shopping and has more influence than short-lived promotions 29
Key takeouts and implications: the general value consciousness of Spaniards has intensified with a continued focus on quality and is reflected by how they determine where to shop 31
INSIGHT: Brand loyalties are under increasing threat as Spanish shoppers give up brands and increasingly embrace private label 32
Spanish consumers are beginning to give up some of their favorite brands as they make more 'considered' choices 33
Private labels are becoming more attractive to Spanish shoppers in the downturn 33
Key takeouts and implications: the general value consciousness of Spaniards, combined with their value-for money purchasing behavior, will create an optimal platform for private label growth 38
INSIGHT: Spanish consumers are embracing money saving tactics when it comes to food and non-alcoholic beverage purchases and preparation 39
Spanish consumers are adopting various responses to cut back on food and beverage spending s, particularly preparing more meals at home 40
Many Spanish shoppers consider private label food and non-alcoholic beverages to be identical to famous branded equivalents 46
Key takeouts and implications: a strengthening desire to cook more often at home has occurred while private label and industry leading brand competition in food and non-alcoholic beverages will intensify 49
INSIGHT: Spaniards' personal care regimes matter greatly and are unlikely to compromised greatly by recession 49
Two thirds of Spanish consumers believe in looking their best in day-to-day life 50
Price and value conscious personal care/beauty shoppers in Spain have not made notable changes to their personal care shopping and usage in order to save money 51
Spaniards are largely unaware or indifferent towards private label personal care products 54
Key takeouts and implications: Spaniards believe in looking good and are committed to taking care of their appearance with private label products proving popular in Spain 56
INSIGHT: Spaniards' alcohol consumption patterns and preferences have not changed significantly during the downturn 57
Spanish consumers pay moderate attention to how much they spend on alcohol, but perceive that they have been making minor cut backs in the amount they consume 58
Spanish drinkers appear to be more value conscious in their at-home alcoholic beverage choices than their out-of-home choices - a trend which has strengthened recently 59
Private label is a strong niche within the alcoholic drinks industry without dominating or being entirely appealing to Spanish consumers 62
Spanish consumers are accepting of private label in general but not when buying alcoholic drinks 64
Key takeouts and implications: there has been little to no change for just over half of Spanish drinkers suggesting that alcohol is relatively 'recession resistant' 65
INSIGHT: Spaniards' household care buying preferences are heavily shaped by price consciousness irrespective of an economic downturn 66
Price led value is still the most influential factor for Spaniards' household and laundry care purchases but preferences do reflect other important influences 66
The private label household care industry in Spain is one of the largest in EUR pe in absolute value and has the highest penetration rate demonstrating Spanish shoppers' desire for value 70
Key takeouts and implications: Spaniards recognize a strong link between hygiene and cleanliness with wellbeing but feel little connection with products they use and just want to finish chores quickly 73
ACTION POINTS 74
ACTION: Adopt a relentless approach to delivering and communicating better value-for-money than the competition 74
Actively demonstrate value-for-money by re-appraising industry ing initiatives, including slogans 74
Ensure that the value gains are instantaneous 75
Focus on quality to maintain differentiation and prove to consumers that quality really matters 76
Evaluate and adapt cost structures so that it is feasible to offer value-for-money solutions 77
APPENDIX 79
Methodology 79
Further reading and references 80
Ask the analyst 81
Datamonitor consulting 81
Disclaimer 81
List of Tables
Data table 1: Consumer survey: level of satisfaction with "the general direction of how things are going" and "quality of life", in Spain (compared with the global average), 2009 10
Data table 2: Consumer survey: satisfaction with current financial situation and importance attached to wealth/ income and having finances in good order, in Spain (compared with the global average), 2009 13
Data table 3: Consumer survey: perceptions of whether broader economic conditions, household's financial situation, job security/confidence and housing industry confidence had improved or worsened in the six month previous and how each might change in the proceeding six months, in Spain, 2009 17
Data 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 Spain, 2008-09 21
Data 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 Spain 23
Data 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 Spain, 2008-09 25
Data table 7: Consumer survey: changing value-consciousness and desire to save money when buying groceries among Spanish shoppers, 2009 29
Data 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 Spanish shoppers, April 2008-April 2009 31
Data table 9: Consumer survey: the relative cost/value and quality consciousness of Australians and global consumers overall when purchasing food and beverage products in 2008 41
Data table 10: Consumer survey: the extent to which Spanish consumers are making effort to save money by adopting various food and drinks consumption and preparation approaches, 2008-09 44
Data table 11: Consumer survey: perception about the relative superiority or inferiority of private labels versus well known or industry leading famous brands in food, soft drinks and hot drinks, in Spain, 2009 48
Data table 12: Private label food penetration and spend ($ millions) in Spain, from 2002 to 2012 48
Data table 13: Private label non-alcoholic beverage penetration and spend ($ millions) in Australia, from 2002 to 2012 48
Data 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 Spanish consumers, 2008 and 2009 51
Data table 15: Consumer survey: the extent to which consumers are making an effort to save money by using spas or salons less often, in Spain, 2008-09 53
Data table 16: Consumer survey: attempts made by Spaniards to change their personal care/beauty habits in order to save money, by product category, 2008-09 54
Data table 17: Private label personal care penetration and spend ($ millions) in Spain, from 2002 to 2012 55
Data table 18: Consumer survey: perception about the relative superiority or inferiority of private labels versus well known or industry leading famous brands for grooming/ beauty products, and agreement that such products are good alternatives to well known or industry leading famous brands, in Spain, 2009 55
Data table 19: Consumer survey: attentiveness towards the amount of money spent on alcohol and the degree to which alcoholic beverage consumers in Spain have cut down on the overall amount of alcohol bought/consumed in 2008-09 59
Data table 20: Total private label alcoholic beverage penetration and spend ($ millions) in Spain, from 2002 to 2012 63
Data table 21: Consumer survey: the degree to which household and laundry care consumers in Spain have bought products on the basis of cost and have bought on the basis of higher quality in 2008-09 68
Data table 22: Consumer survey: Spanish attitudes towards doing housework, 2008 69
Data table 23: Private label household care penetration and spend ($m) in Spain, from 2002 to 2012 71
Data table 24: Consumer survey: perception about the relative superiority or inferiority of private labels versus well known or industry leading famous brands for household cleaning/laundry products, and how often such products are purchased to save money, in Spain, 2009 73
List of Figures
Chart 1: Datamonitor's Recession and Recovery portal will allow market players to continually identify emerging opportunities and track what is happening in the Spanish economy as it develops 5
Chart 2: More than four fifths of Spanish consumers believe the country is in recession with a large proportion opting to state they 'strongly agree' 6
Chart 3: Almost one-in-three Spaniards feels that their lifestyle has not changed in light of the downturn 7
Chart 4: From a personal perspective, EUR pean and US individuals generally looked at 2008 negatively, including those in Spain 9
Chart 5: Spaniards have strong negative feelings about the direction of events in their country but are still mainly positive about their quality of life 10
Chart 6: Almost a half of Spanish consumers are currently dissatisfied with their financial situation 12
Chart 7: Spaniards are concerned about the general economy which is heavily motivated by the negativity surrounding the national property industry 14
Chart 8: The highest proportion of Spanish consumers believes that the economy will decline further 16
Chart 9: Spanish consumers are managing their finances more closely while almost one third of individuals report difficulties in paying all the bills 18
Chart 10: Spaniards are generally reluctant to sustain their reliance on credit and express an increasing desire to save money 19
Chart 11: The economic downturn has also been accompanied by additional stress levels among Spaniards 22
Chart 12: Spaniards often feel tiredness while one in five has experienced a worsening work-life balance in the period October 2008 to April 2009 24
Chart 13: More than one in five Spanish citizens feels they have experienced reduced happiness during the period October 2008 to April 2009 26
Chart 14: The overwhelming majority of Spanish consumers is more value conscious following the downturn 28
Chart 15: Quality of products sold has more influence than lower prices or habit over where people in Spain do their shopping 30
Chart 16: A growing propensity to become more 'mission focused' is one of the more significant changes in Spanish shopper behavior in recent times 31
Chart 17: As the downturn has intensified, so too has the extent to which consumers have been forced to sacrifice some of their favorite brands 33
Chart 18: Private label range plays a role in where people shop, not just in Spain, but globally 36
Chart 19: More than half of Spanish shoppers are routinely buying private label/store branded products in an effort to save money 37
Chart 20: The private label industry is impacted by a broad range of drivers and inhibitors 38
Chart 21: Spaniards became increasingly value conscious in their food and beverage choices in 2008, and were more accepting than many of a need to compromise on quality 41
Chart 22: The attributes deemed most influential in what food and beverages Spaniards buy also highlight the price consciousness shaping the choices they make 42
Chart 23: Spanish consumers are adopting various responses to cut back on food and beverage spending s 43
Chart 24: There has been a minor shift in the actual self-reported propensity for Spanish consumers to cook an evening meal at home from scratch in 2008-09 45
Chart 25: There has been little change in the propensity for Spaniards to have a takeaway meal at home in 2008-09 46
Chart 26: Spanish consumers show divergent opinions about how famous branded products, compare with private label equivalents in food, soft drinks and hot drinks categories 47
Chart 27: Spanish consumers are appearance conscious and this makes them less willing to trade-down when making personal care choices 50
Chart 28: Spanish personal care/beauty shoppers became more price and value conscious in 2008 but showed little desire to sacrifice on quality 52
Chart 29: Personal care/beauty shoppers in Spain and elsewhere make purchase price a high priority 53
Chart 30: Almost half of Spanish consumers consider private label beauty products to be good alternatives to well known or industry leading brands 56
Chart 31: Spanish consumers are moderately careful about how much they spend on alcohol and have been making moderate cut bucks in the amount they consume in 2008-09 58
Chart 32: Value consciousness among Spanish drinkers has had more impact on out-of-home alcoholic drinks' consumption in 2008-09 60
Chart 33: Spanish drinkers, perhaps influenced by a sense of entitlement, are reluctant to opt for cheaper brands and formats of alcoholic beverages 61
Chart 34: Two in five Spanish drinkers are highly influenced by alcohol beverage promotional offers 62
Chart 35: Only 25% of Spanish drinkers believe that private label alcoholic drinks are good alternatives to industry leading or famous brands 63
Chart 36: Spaniards largely see private label alcohol beverages as inferior to famous brands 64
Chart 37: Despite recession, Spanish drinkers say they are now less motivated by price, but the appeal of well-known brands has grown, as consumers seek to avoid wasting money 65
Chart 38: Price led value is still the most influential factor for Spaniards' household and laundry care purchases 67
Chart 39: In 2008, Spanish household and laundry care choices were made with greater consideration for cost / value but consumers showed an ongoing desire for efficacy led quality 68
Chart 40: Spaniards value cleanliness, inherently dislike household tasks and seek to minimize the amount of time they spend on such tasks 69
Chart 41: More than two-thirds of Spaniards are 'frequent' purchasers of household care products on the basis of value-for-money 70
Chart 42: Just over two in five Spaniards regularly purchases private label household care products to save money 71
Chart 43: A small proportion of Spaniards considers private label household and laundry products to be superior to branded equivalents 72
Chart 44: Major grocery discounters in Spain are trying to position themselves as the perfect intersect of quality and value-for-money 75
Chart 45: Mercadona in Spain is exploring new ways to make its loyalty card more compelling with pre-payment options 76
Chart 46: Manufacturers and distribution ers 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 77
