Own brands are consolidated and consumers choose smaller formats in the face of high inflation
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Finally, the rise in the cost of living began to subside: in October the Consumer Price Index (CPI) increased by 12.8% annually, below the 13.7% that had risen in September, when it was already showing some moderation. from the previous month. But the changes in habits that high inflation has caused -which makes money yield less- have been taking hold over time.

This is how the panel carried out by the English firm Kantar shows 3,500 households from Arica to Puerto Montt, using the receipts of all their purchases of 75 categories of the basket of immediate consumption products (FMCG). In the last rolling year to September, purchase volume has fallen by 6% and spending has moderated to 2.9%, with basket inflation rising to 9.8%. All in all, home consumption remains 5.5% above the pre-pandemic.

“Own brands continue to gain relevance in this scenario,” says the country manager at Kantar Chile-Worldpanel division, María Paz Román. She explains that the aforementioned added to the economic brands weigh 24.1% within the total value, in contrast to the premium ones that have dropped to 20.3%. There are even 53 categories that are increasing their penetration, that is, the number of own-brand buyers.

The analysis shows that 47% of the categories in the panel increased their average price above basket inflation -9.8%-, and warns that these are the ones with the greatest migration to smaller formats or packaging. And it is that, in their quest to make the budget perform better, in 77% of the products with the highest increase, consumers are preferring smaller formats, since it allows them to make “a lower outlay,” says Román.

“Consumers are very intelligent, and they know that if they buy large formats, the price per unit is lower,” he says. But, he explains that, in a scenario of less liquidity, consumers are choosing to cover the need of the moment.

Offers in sight

The other thing that has increased is the expense under the perception of promotions, by 13%, from 9.5% in the second quarter. The Kantar representative adds that, for this reason, people are going more often to the stores.

This is reflected in the figures: the purchase frequency increased to 0.6% -from the decrease of 1.7% in the previous quarter-, but the purchase per act fell to 6.1%, deepening the drop of 2.9 %. The phenomenon is also related to the fact that people are buying fewer grocery products, which falls from 39% to 36.2%.

In a zoom by socioeconomic group, the extremes are what drive the contraction in volume. In the DE group -fewer resources- spending increases 3.8% and volume falls 2.5%, in a scenario in which they consume 8.4 units per act, that is, 5% less than before.

For the ABC1 group, spending contracted by 1.7%, similar to what happens with volume. With this, 10.3 units per act are purchased, that is, 11.1% less than before.

Households are also prioritizing spending in more basic categories (41% in the second quarter to 45% in the third). For this reason, food -despite the price increases- decreases its demand less than the average, with an increase in frequency and higher receipts (see graph).

In this whole picture, the traditional sales channel continues to gain space -mainly stores and wholesalers- while discounters stand out in the modern channel, and e-commerce has recently recovered. And it is that a wholesaler is 21% cheaper on average, it is 14%, says Román.

To stay

Although inflation has begun to subside, the executive suggests that the new habits will continue.

“In the short and medium term, you will continue to have an even more intelligent consumer, who will visit different stores or different channels even more, seeking to maximize their budget, because regardless of inflation falling, prices have already remained at a much higher level. higher”, says Román, and recalls that the market projects a drop in activity of around 1% of the Gross Domestic Product for next year.

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