The rise of premium consumption in Portugal

Lisbon, February 2019 - With greater purchasing power and a growing willingness to buy products with superior features at higher prices, consumers all over the world are increasingly looking for products premium. The internet is becoming a popular destination for consumers globally, with exclusive product ranges and unique opportunities driving local and international sales for online retailers, according to a new global report by Nielsen.

The study "Changing Consumer Prosperity", which reveals the behavior of consumers and their spending on products premiumconcluded that consumers around the world are increasingly choosing to buy higher-end products from local and international retailers online.

As far as Portuguese consumers are concerned, 21% claim to buy products premium in local retailers' online stores (+3 percentage points compared to 2016) and 17% say they do the same, but opt for an international retailer (+4 pp versus 2016). Regarding the purchase of products premium in local physical stores, the numbers are still overwhelming (89%), well above the European average of 60%.

For Ana Paula Barbosa, Retailer Vertical Director at Nielsen Portugal, "this new context is an opportunity for the consumer, who has access to more quality products, but also for physical stores, online stores and manufacturers, from the largest to the smallest. The consumption of premium It is, in fact, an opportunity that leaves no one out and all players will be able to take advantage of this new reality."

Premium products... Why?

For the Portuguese, what makes a product premium is above all its highest quality (62%), the function or performance (53%), customer service (50%) and offering or doing something unique and differentiating (43%). In fact, the vast majority of national consumers say they would be willing to pay a price premium for products with these characteristics.

It should also be noted that around 1/3 of consumers say they are "highly willing" to pay more for natural, organic and sustainable products.

According to the Nielsen report, the choice of range products premium in a wide variety of categories. Compared to the rest of the world, Portuguese consumers attach significant importance to quality fresh products such as meat, fish and seafood. 36% of those surveyed consider buying this type of product in segments premium. Clothing, electronic goods and various categories of personal care are also among the top products for which the Portuguese are most willing to buy at higher prices.

 

 

When it's time to try a new product premiumHalf of Portuguese consumers rely on recommendations from friends or family. This is followed by research into a particular product (33%), impulse buying (23%) and online (22%), television (21%) and in-store (21%) advertising.

"Among the most varied studies produced by Nielsen, we have been able to identify three major factors that have driven the 'premiumization' of consumption. Firstly, changes in the standard of living of consumers in Portugal, who in the last five years consider that they have significantly improved their financial conditions and are now more willing to buy. On the other hand, the proliferation of spaces (physical or digital) where you can find the most varied assortments of products premium in all categories of all sizes. And finally, in response to their increasingly busy lifestyles, consumers' concerns end up being intrinsically related to health and well-being, as well as to a more balanced and happier life, with more time for what they love most," explains Ana Paula Barbosa.

"The market has kept pace with this new reality, with a significant range of products on offer premium and niche segments, which have been gaining ground both in Portugal and around the world, especially in categories related to these new consumer needs," he concludes.