Germans are changing their consumer behavior in the face of inflation. This is shown by the so-called Future Consumer Index of the consulting company EY, which is exclusively available to WELT. In many cases, only the bare essentials are bought, and consumers are increasingly turning to cheap private labels.
"Especially when it comes to groceries, buyers want inexpensive alternatives to conventional branded products," says Michael Renz, Head of Consumer Goods and Retail at EY Germany. "Many customers now have to think very carefully about what they can still afford when shopping."
According to the study, around three-quarters of the 1,000 Germans surveyed in June are increasingly turning to their own brands for both fresh and processed food. In an international comparison, there are similarly high values in Great Britain alone, where 1000 consumers were also surveyed.
"If the supermarkets and discounters manage to offer high-quality products at lower prices here, this is a great opportunity to sharpen their own brand profile," explains expert Renz. And that is increasingly at the expense of organic products.
"High-priced organic products are having a harder time with the current developments than before the pandemic," says the consultant. Because the price difference to standard products is sometimes very large. "Anyone who has to turn over every euro twice will think twice before reaching for an organic product."
However, the organic boom that has lasted for years does not seem to be over yet. In any case, the Bund Ökologische Lebensmittelwirtschaft (BÖLW) speaks of a "robust market" in the first five months of 2022 at the start of the world's largest industry trade fair Biofach in Nuremberg.
However, since then, inflation has again increased significantly, and fears for one's own finances are also growing. In any case, according to the “Future Consumer Index”, pessimism is increasing in Germany. Only 18 percent of the Germans surveyed believe that their financial situation will improve in the next three years.
Conversely, 35 percent – almost twice as many – expect things to get worse. For comparison: optimists predominate in countries such as India, China and the USA, but also in Sweden, Finland and Italy.
But this doom and gloom doesn't just affect finances. In a number of other areas, too, the world is – in some cases significantly – more confident than the Germans about the coming months, be it in terms of professional development, the effects of climate change or even physical health.
"The consumer mood in Germany is bad - and threatens to slip further," states EY representative Renz. “The current crises are to blame for this: war in Europe, severely gloomy economic prospects, high inflation. And more bad news can be expected, at the latest when the feared gas shortages occur in autumn and winter.”
At least the rising cost of living concerns the Germans surveyed more than the global average. The main concern is the sharp rise in costs for electricity, gas and water - and that this will have a very strong impact on life over the next year.
So the Germans keep their money together and want to save. And when in doubt, that means doing without. Already 55 percent of the consumers surveyed from Germany plan to spend less money on non-essential products in the coming months. But the Germans have plenty of company, as the global average is 51 percent.
In an international comparison, the Germans are on par with the plan to increasingly rely on own brands. However, the priorities in this project differ widely.
Domestic consumers want to switch to cheap alternatives, mainly when it comes to fresh and processed food - which is the complete opposite of consumer behavior in the Corona crisis. In countries like Japan, India or China, on the other hand, far fewer consumers are eligible, the same applies to Sweden, Finland and Italy.
However, when it comes to alcoholic beverages, Germans remain largely loyal to their favorite brands. 33 percent of the Germans surveyed plan to buy more of their own brands of beer, schnapps and the like in the future. However, this value is not even half as high as in the food sector, where the corresponding plan exists for over 70 percent of the participants.
The British and Indians, for example, are significantly less sensitive to alcohol. The same applies to clothing, shoes and accessories. In this segment, two-thirds of Indians and around half of Britons and Americans state that they want to pay less attention to branded goods in the future. In Germany, this is an issue for 44 percent of those surveyed, which is almost the average of the nine countries participating in the “Consumer Index” this time.
However, Germans may also be forced to change their purchasing behavior for certain products due to a lack of availability. Three out of five respondents in Germany now say that they wanted to buy a product but it was not in stock.
In the last survey in February 2022, this value was still 36 percent. The situation in Germany is thus developing against the global trend: while in February every second person worldwide said that certain products were not in stock, this proportion fell slightly in June to 46 percent.
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