Posted onOctober 26, 2013
Rising food prices will prompt more than a third of UK consumers to buy more own-label food and drink products, reveals research from consumer insight organisation Nielsen.
Up to 39% of UK shoppers planned to buy more own-label food and drink products as food prices rise, according to the research. But only 5% planned to buy more branded goods.
Own-label products account for about 16% of global fast moving consumer goods value share, said Nielsen.
James Russo, Nielsen senior vice president for global consumer insights, said: “Own-label brands have a potential advantage during inflationary times. However, the price must be right and marketing must be effective for private-label brands to succeed. Packaging impacts trust and quality perceptions, especially when own-labels extend beyond commodity or low-risk product categories.”
When asked about specific food categories, 13% of UK shoppers said they planned to buy more loose, unpackaged, unbranded cereal, such as rice, wheat and grains.
Frozen fruits and vegetables
While 8% of consumers said they would stock up on fresh or frozen fruits and vegetables, 7% said they planned to buy more canned fruits and vegetables.
But 82% of respondents reported no plans to change their spending on staples, such as dairy products. More than 70% said they would not change purchase of meat and poultry and nearly 80% said their bread and bakery goods purchases would remain unchanged.
The results contrasted with discretionary categories. Only 37% of UK respondents and 26% of those on the continent said they would buy the same amount of alcoholic beverages if food prices rise.
More than eight-in-10 (81%) of UK shoppers and 85% of global consumers confirmed that rising food prices would influence their choice of grocery products.
“When it comes to rising food prices, nearly everyone feels the pain,” said Russo. “Determining which product categories have staying power and which are more vulnerable is critical as consumers make trade-offs and tough in-store decisions.
‘Stretch their budgets’
“Likewise, as consumers continually look for ways to stretch their budgets and find the best value for money, marketers need to identify retailers that will satisfy the unique demands of consumers around the world.”
Food was not the only product that would be impacted by rising food prices. Nearly two-thirds (63%) of UK respondents said they would cut spending on new clothes, while 60% said they would dine out less often.
More than half (54%) said they would cut back on snack foods and 37% said they would spend less on holiday travel.
The Nielsen Global Survey of Inflation Impact canvassed the views of more than 29,000 internet respondents in 58 countries.
Rising food prices in numbers
- 81 – percent of UK consumers said rising food prices will impact their choice of grocery products.
- Four – in 10 Brits will shop more for own-label brands as food prices rise.
- Three – in 10 Brits will shop more at discount stores.
- 54 – percentage who will cut back on snacks.