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Jun 18, 2019

More confidence, more consumption: BGC growth in the first quarter

Confidence Index

  • National confidence index overtakes Europe
  • Volumes recover in FMCG
  • Portugal in the top 10 for value growth among 28 European countries

The climate remains positive in Portugal. The Portuguese are confident and willing to spend. Health, leisure and well-being are now part of their concerns. Everything points to a scenario of growth in FMCG. And that's exactly what happened in the first quarter of 2019. These are the results of Nielsen's Confidence Index and Growth Reporter studies. What will the rest of the year bring?

91 points: Portugal overtakes Europe

Portugal has a Confidence Index of 91 points, one of the highest ever. Reversing their historical pessimism, the Portuguese now show a higher level of optimism than the European average (83 points), surpassing countries such as Spain (88), France (72) and Italy (68).

Health and work-life balance are priorities for consumers. These two concerns are both mentioned by 28% of consumers, leaving employment, rising bills or the economy almost ten percentage points behind. In an increasingly ageing country, the well-being and happiness of parents is also a top concern.

After paying their usual expenses, fewer and fewer Portuguese say they have no money left (although they still represent 1/5 of the population). Of the money they do have left over, more and more are spending it on entertainment away from home, vacations or trips. However, the Portuguese once again point to savings as their main priority (50%).

Volumes recover in Portugal. Europe falls 0.51TP3Q

In previous periods, Nielsen had seen a stabilization of growth in volumes, i.e. consumption itself was not increasing, but only in value. However, in the first quarter of 2019 we saw growth of 1.6% in volume, contrary to what is happening in Europe, where volumes fell by 0.5%.

In terms of value, Portugal also stands out in relation to the European average, making it into the Top 10 countries with the highest growth in value (3.1% in Portugal; 2.4% in Europe). In total, BGC reached almost €2 billion in this period. The price effect also grew by 1.5% in this period, proving that the Portuguese are buying more and at higher prices.

Confidence Index

In this first quarter, Beverages was the most dynamic category, with Alcoholic Beverages growing by 10% and Non-Alcoholic Beverages by 9%, in a period in which there were higher temperatures than in 2018, contributing to the category's greater growth. It should also be noted that, in this analysis, the period corresponding to the first quarter includes December 31, 2018 (unlike the previous year), which contributes to the greater dynamism of Alcoholic Beverages, as well as Food, which gain prominence in these periods.

In total BGC, it was Manufacturer Brands (+4.4%) that stood out the most compared to Distribution Brands (+0.6%).

What will the rest of the year be like?

"The increased level of confidence among Portuguese consumers and their focus on well-being, health and leisure are signs of a change that has already taken place. The Portuguese are more positive, have more money available, and want to spend it on something that brings them some kind of benefit. After a period of some stabilization in volumes and growth in value, we are now seeing growth on both sides: this quarter, consumers bought more and also spent more. For the rest of the year, and given that there have been no increases in population, we don't expect very significant increases in volumes. However, we have identified many opportunities for growth in the value-added categories, which will certainly bring more room for growth in value," comments Ana Paula Barbosa, Retailer Services Director at Nielsen Portugal.


About Nielsen Growth Reporter:
The Nielsen Growth Reporter compares global market dynamics (values and units sold) in the European FMCG sector. It is based on sales monitoring carried out by Nielsen in 28 markets and covers sales made in traditional stores, hyper and supers, and convenience stores. It is based on the widest possible selection of product categories that are continuously measured by Nielsen in each of these countries and channels.
About Nielsen:
Nielsen Holdings plc (NYSE: NLSN) is a global measurement management and data analytics company that provides the most complete and reliable insight into markets and consumers around the world. Nielsen brings together its own data with data from other sources to help its clients around the world understand what is happening now and what will happen in the future, and how best to use that knowledge. For more than 90 years, Nielsen has been providing innovative, scientifically rigorous data and analysis, and continues to develop new ways of answering the most important questions facing the media industries. mediaadvertising, retail and FMCG are currently facing. Nielsen, a Standard & Poors 500 company, is present in more than 100 countries, representing more than 90 percent of the world's population. For more information, visit www.nielsen.com.
[1] The Conference Board® Global Consumer Confidence Survey, conducted in collaboration with Nielsen.

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