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Cross-Category Trends

Cross-Category Trends

People are in the mood to shop

Consumer sentiment is on the up and as confidence rises, so does people’s willingness to hit the shops and get spending. An interest rate cut by the European Central Bank in September 2019 has been attributed, at least in part, to the growing interest in buying, having made credit more affordable and, at the same time, saving less attractive. This comes at a time when salaries have been rising at above-inflation rates and employment is at record highs, so there are more people with more money in their pockets. With German exports slowing, domestic household spending is becoming increasingly important for many domestic brands.

E-commerce still has room to grow

The near-infinite choice available online has helped make Germany the second-biggest e-commerce market in Europe, after the UK. Over 90 percent of Germans say they shop online at least occasionally, mainly for the extensive range available rather than in the hope of finding cheaper prices. The pace of growth in online sales is expected to slow now, but there remains scope to encourage people to shop in new categories – grocery sales online, for instance, are well behind neighboring markets. There is also an opportunity to encourage more frequent purchasing, perhaps as consumers make the switch from buying on a computer to buying via mobile phone.

Green is the new black

Concern about the environment is growing around the world, and German consumers are at the leading edge when it comes to making and demanding change. And, contrary to what many people might expect, it’s not just the young who are worried. In fact, in Germany, over-50s represent about two-thirds of the people we call “eco-actives” – those most keen to make changes to their lives in order to improve the environment. They are shunning plastic bags and drink bottles in big numbers, shunning products sold in plastic packaging, and reducing the meat they consume. German consumers won’t shower a brand with love simply for doing what they see as “the right thing” by the environment – whether that’s reducing plastic, using recycled packaging or cleaning up its supply chain. These things are increasingly just expected.

The payment is space hotting up

Cash is falling out of favor in Germany, with 2019’s share of card transactions in the retail market having overtaken cash payments for the first time ever. This is a shift that has happened much sooner in other developed economies because cards save people the hassle of withdrawing and carrying cash, but in Germany, cash has lingered longer, a fact attributed to a consumer unwillingness to have their every move and purchase tracked. Now that cards account for the majority of purchases, this indicates there is potential for digital payment methods to take off, particularly among younger consumers, who are driving demand for e-payment options globally. These people are not just looking for a different option when they checkout online; they’re seeking greater financial control and looking for payment technology that helps them manage their (increasingly digital) lifestyle, as well as complete a purchase.

Healthy choices and creating opportunities

A desire to be healthy is not only leading to growing interest in exercise but also affecting the way people eat – and what and when they choose to eat. Around the world, people increasingly say they try to start the day with a healthy breakfast, and they’re choosing lighter options for their other main meals, with fewer courses, and cooking methods they believe are better for them. There’s also a rise in snacking, but not snacking as we’ve known it before. Rather than reaching for potato chips or a sweet treat, snackers are looking for fresh fruit and other healthy snacks between meals. Brands and retailers have a big opportunity to satisfy this rising appetite for healthier food and drink, especially when consumers are on the go.