The Global Economic Crisis: The Impact On Consumer Attitudes & Behaviors In The Netherlands

Table of Contents

OVERVIEW

• Catalyst
• Summary

THE FUTURE DECODED

• INTRODUCTION: Understanding how ' recessionary mindsets' influence Dutch consumers' attitudes towards and actual consumption is vital
  • The ' recessionary mindset' of Dutch consumers in 2008-09 is reflected by the widespread belief that they are in a recession
  • The economic downturn has had an impact on the lifestyles of more than half of Dutch consumers
  • Key takeouts and implications: a ' recessionary mindset' has not been fully matched by a recessionary impact on Dutch consumers lifestyles
• TREND: Dutch citizens remain appreciative of their quality if life even if they are conscious of a worsening economic situation
  • Dutch citizens are generally downbeat about how things are going and this appears to be negatively impacting perceptions about quality of life
  • Key takeouts and implications: the mood towards the direction of Dutch society has further dampened as the economic downturn has deepened, but Dutch citizens remain satisfied with their quality of life
• TREND: Dutch consumers have lost confidence in their financial security and are being more scrupulous in response
  • Satisfaction with one' s financial situation is low among Dutch consumers but negative sentiment is lower than consumers from elsewhere
  • Perceptions about the economy, job security, financial status and the housing market in the Netherlands have all worsened in 2008-09 and there is only limited optimism looking towards the latter end of 2009
  • Dutch consumers are managing their finances more closely with some even struggling to pay the bills
  • Dutch consumers are making greater efforts to save while negative attitudes towards credit prevail
  • Key takeouts and implications: Dutch consumers have lost satisfaction in their financial situation and there is only some optimism of any improvement coming towards the end of 2009
• INSIGHT: The global financial crisis has had a negative impact on the emotional wellbeing of Dutch consumers with levels of stress up and personal happiness down
  • Stress levels have all been negatively impacted during the financial downturn
  • Work-life balance has also worsened in combination with the deepening downturn
  • The happiness levels of Dutch citizens have not been significantly dampened with the global economic crisis
  • Key takeouts and implications: recessionary consumers in the Netherlands have not been demonstrating a significant need for an emotional and physical ' pick-me-up'
• INSIGHT: Dutch consumers have become increasingly price and value consciousness following the global economic downturn
  • Dutch consumers are becoming more value conscious amid the economic crisis and therefore looking to save money when buying groceries
  • Price and value consciousness heavily influences where Dutch consumers do their grocery shopping and how they shop but quality still matters too
  • Key takeouts and implications: value consciousness among Dutch consumers has intensified, albeit less so than elsewhere, and is reflected by how they determine where to shop
• INSIGHT: Quality conscious and comparably confident Dutch shoppers are trying to remain loyal to brands despite the negative impact of the economic downturn
  • Dutch consumers are reluctant to give up some favorite brands as they make more ' considered' choices
  • Private labels are becoming more attractive to Dutch shoppers in the downturn
  • Key takeouts and implications: private label appeals to value conscious Dutch shoppers but they many remain broadly loyal to their favourite brands
• INSIGHT: Dutch consumers are embracing money saving tactics when it comes to food and non-alcoholic beverage purchases and preparation
  • Dutch consumers are adopting various responses to cut back on food and beverage expenditures
  • Many Dutch shoppers consider private label food and non-alcoholic beverages to be identical to famous branded equivalents
  • Key takeouts and implications: a resurging desire to cook more often at home has occurred while private label and market leading brand competition in food and non-alcoholic beverages will intensify
• INSIGHT: The significant majority of Dutch consumers' personal care regimes and related product choices have been ' recession resistant'
  • Over half of Dutch consumers are committed to looking their best in day-to-day life
  • Price and value conscious personal care/beauty shoppers in the Netherlands have not made notable changes to their personal care shopping and usage in order to save money
  • Dutch consumers are largely unaware or indifferent towards private label personal care products
  • Key takeouts and implications: Dutch consumers' health and beauty regimes are proving to be largely recession resistant Since personal appearance is so heavily correlated with self-esteem, consumers are more likely to be emotionally involved with personal care brands because they play a notable role in defining that person both internally (i.e. how he or she feels about him or herself) and externally (i.e. how he or she is perceived by others). As a result, even in uncertain times people are still willing to spend money on making themselves look good and feel good.
• INSIGHT: Dutch consumers' alcohol consumption patterns and preferences have not changed significantly during the downturn
  • Dutch drinkers are careful about how much they spend on alcohol but do not perceive that they have been making significant cut backs in the amount they consume
  • Dutch drinkers appear to have become more value conscious in their at-home alcoholic beverage choices than their out-of-home choices
  • Private label alcohol is relatively prominent in the Netherlands but consumers still express uncertainty about comparative quality against branded equivalents
  • Dutch drinkers are more concerned about the quality credentials of alcoholic beverage brands and are less concerned about brand imageThere is a status that comes from buying what is perceived to be the ' right brand' . Traditionally, an attractive aspect of premium (alcoholic beverage) products has been the chance for a consumer to show their peers the extent of their affluence and good taste. Image-conscious consumers that typically have a desire to link themselves to brands often seek conspicuous, status-enhancing products in order to create an identity and image around themselves. Because alcohol is so often consumed in a more conspicuous setting, marketing (particularly in the case of upscale brands) often emphasizes the status credentials of brands.
  • Key takeouts and implications: there has been little to no change for around eight in 10 Dutch drinkers, suggesting that alcohol preferences and habits in the country are largely ' recession resistant'
• INSIGHT: Dutch consumers' household care buying preferences are heavily shaped by price consciousness irrespective of an economic downturn
  • Price-led value is still the most influential factor for Dutch shoppers' household and laundry care purchases but preferences do reflect other important influences
  • The private label household care market in the Netherlands is small but potentially lucrative given shoppers' desire for value
  • Key takeouts and implications: Dutch consumers associate hygiene and cleanliness with wellbeing and this makes them somewhat quality conscious

ACTION POINTS

• ACTION: Adopt a relentless approach to delivering and communicating better value-for-money than the competition
  • Actively demonstrate value-for-money by re-appraising marketing initiatives, including slogans
  • Ensure that the value gains are instantaneous
  • Focus on quality to maintain differentiation and prove to consumers that quality really matters
  • Evaluate and adapt cost structures so that it is feasible to offer value-for-money solutions
  • Start planning for the longer-term by continually tracking Dutch consumers as an economic recovery begins to become a reality

APPENDIX

• Methodology
• Further reading and references
• Ask the analyst
• Datamonitor consulting
• Disclaimer

TABLES

• Table: Consumer survey: level of satisfaction with "the general direction of how things are going" and "quality of life", in the Netherlands (compared with the global average), 2009
• Table: Consumer survey: satisfaction with current financial situation and importance attached to wealth/ income and having finances in good order, in the Netherlands and globally, 2009
• Table: Consumer survey: perceptions of whether broader economic conditions, household' s financial situation, job security/confidence and housing market confidence had improved or worsened in the six month previous and how each might change in the proceeding six months, in the Netherlands, 2009
• Table: Consumer survey: propensity to feel tense and the extent to which perceived levels of stress have changed in the last six months and are expected to change in the next six months, in the Netherlands, 2008 - 09
• Table: Consumer survey: propensity to feel very tired and the extent to which perceived work-life balance has changed in the last six months and are expected to change in the next six months, in the Netherlands, 2008 - 09
• Table: Consumer survey: happiness levels and the extent to which perceived happiness has changed in the last six months and are expected to change in the next six months, in the Netherlands, 2008 - 09
• Table: Consumer survey: changing value-consciousness and desire to save money when buying groceries among Dutch shoppers, 2009
• Table: Consumer survey: changing efforts being made to use coupons, change grocery store choice to save money, embrace more disciplined shopping and gather and utilize store price information, among Dutch shoppers, April 2008-April 2009
• Table: Consumer survey: the extent to which consumers are making effort to save money by adopting various food and drinks consumption and preparation approaches, in the Netherlands, 2008-09
• Table: Consumer survey: perception about the relative superiority or inferiority of private labels versus well known or market leading famous brands in food, soft drinks and hot drinks, in the Netherlands, 2009
• Table: Total private label food penetration and spend ($ millions) in the Netherlands, 2002-2012
• Table: Private label non-alcoholic beverage penetration and spend ($ millions in the Netherlands, 2002 - 2012
• Table: Consumer survey: the importance attached to looking one' s best in day-to-day life, the pressure to look good, and satisfaction with physical attractiveness/appearance, among Dutch consumers, 2008 and 2009
• Table: Consumer survey: the extent to which consumers are making an effort to save money by using spas or salons less often, in the Netherlands, 2008 - 09
• Table: Consumer survey: attempts made by Dutch consumers to change their personal care/beauty habits in order to save money, by product category, 2008 - 09
• Table: Private label personal care penetration and spend (US$ millions) in the Netherlands, 2002 - 2012
• Table: Consumer survey: perception about private labels versus well known or market leading famous brands for grooming/beauty products in the Netherlands, 2009
• Table: Consumer survey: attentiveness towards the amount of money spent on alcohol and the degree to which alcoholic beverage consumers in the Netherlands have cut down on the overall amount of alcohol bought/consumed in 2008 - 09
• Table: Total private label alcoholic beverage penetration and spend (US$ millions) in the Netherlands, 2002 - 2012
• Table: Consumer survey: the changing degree to which household and laundry care consumers in the Netherlands made product choices with value or cost in mind, 2008
• Table: Consumer survey: attitudes towards doing housework in the Netherlands and globally, 2008
• Table: Private label household care penetration and spend ( US $m) in the Netherlands, 2002 - 2012
• Table: Consumer survey: perception about the relative superiority or inferiority of private labels versus well known or market-leading famous brands for household cleaning/laundry products, and how often such products are purchased to save money, in the Netherlands, 2009

FIGURES

• Figure: Datamonitor' s ' Recession and Recovery' portal will allow industry players to continually identify emerging opportunities and track what is happening in the Dutch economy as it develops
• Figure: Over three-quarters of Dutch consumers believed the country was in recession in April 2009
• Figure: The Dutch have been feeling the impact of the downturn less so than in other countries
• Figure: In the midst of the global economic crisis, Dutch consumers remained comparatively bullish about their perceived purchasing power
• Figure: Dutch consumers are inherently dissatisfied with how things are going in the country but remain largely satisfied with their overall quality of life
• Figure: Dutch GDP and household consumption has recorded negative growth in the first half of 2009
• Figure: In 2009, Dutch citizens have become somewhat ambivalent about their personal financial situation
• Figure: Dutch negativity about the economy at large is greater than that shown towards their personal situation which reflects the comparatively high resilience of Dutch consumers
• Figure: Only 20% of Dutch consumers expected economic conditions to improve by October 2009
• Figure: Both Dutch consumer and industry confidence has shown signs of bottoming out in the second quarter of 2009
• Figure: Dutch consumers are managing their finances more closely while nearly a third of individuals report difficulties in paying all the bills
• Figure: Dutch consumers express ongoing reluctance about using credit to maintain their lifestyles and an increasing desire to save money
• Figure: The economic downturn in the Netherlands has also been accompanied by additional levels of stress
• Figure: Dutch consumers are prone to fatigue, but few perceived they had experienced a worsening work-life balance in the period October 2008 to April 2009 and few expected this scenario to worsen
• Figure: Few Dutch citizens have become less happy as the financial crisis intensified in 20008-09
• Figure: The overwhelming majority of Dutch consumers are more value conscious following the downturn
• Figure: Quality of products sold has more influence than lower prices or habit over where people in the Netherlands so their shopping
• Figure: Dutch consumers have not been particularly active in modifying their approach to shopping in order to save money
• Figure: Even as the downturn has intensified, quality conscious Dutch consumers have tried to maintain brand preferences - more so than their global counterparts
• Figure: Half of Dutch shoppers are routinely buying private label/store branded products in order to save money
• Figure: Private label range plays a role in where people shop, not just in the Netherlands, but globally
• Figure: Private label range is important in shaping the value-for-money considerations of Dutch shoppers
• Figure: The private label market is impacted by a broad range of drivers and inhibitors
• Figure: Dutch consumers became increasingly value conscious in their food and beverage choices in 2008, but that was not reflected by a substantial quality compromise
• Figure: The attributes deemed most influential in what food and beverages Dutch consumers buy reiterate the influence of quality and price in their general decisions
• Figure: Dutch consumers are both quality and price focused in their food shopping orientations
• Figure: Dutch consumers are adopting various responses to cut back on food and beverage expenditure, but none of them to a significant degree
• Figure: There has been little change in the self-reported propensity for Dutch consumers to cook an evening meal at home from scratch
• Figure: There has been little change in the self-reported propensity for Dutch consumers to have a takeaway meal at home
• Figure: Dutch consumers are split on their opinions about how famous branded food products, soft drinks and hot drinks compare to private label equivalents
• Figure: Dutch consumers are appearance conscious and this makes them less willing to trade-down when making personal care choices
• Figure: Dutch personal care/beauty shoppers became more price and value conscious in 2008 but showed little desire to sacrifice on quality
• Figure: Personal care/beauty shoppers in the Netherlands and elsewhere are highly price conscious
• Figure: Nearly two-thirds of Dutch consumers consider private label beauty products to be good alternatives to well known or market leading brands
• Figure: Dutch consumers are careful about how much they spend on alcohol but do not perceive that they have been making significant cut bucks in the amount they consume
• Figure: Value consciousness among Dutch drinkers has had more impact on at-home alcoholic drinks' consumption in 2008 - 09, albeit not to a significant extent
• Figure: Dutch drinkers, perhaps influenced by a sense of entitlement, are reluctant to opt for cheaper brands and formats of alcoholic beverages
• Figure: Nearly one-quarter of Dutch drinkers are highly influenced by alcohol beverage promotional offers
• Figure: Over one-third of Dutch drinkers believe that private label alcoholic drinks are good alternatives to market-leading or famous brands
• Figure: Dutch drinkers are most likely to be skeptical of private label beer compared to wine or spirits
• Figure: Although Dutch drinkers are price conscious, brand name is increasingly shaping preferences
• Figure: Price-led value is still the most influential factor for Dutch consumers' household and laundry care purchases
• Figure: In 2008, Dutch household and laundry care choices were made with greater consideration for cost/value but consumers showed an ongoing desire for efficacy-led quality
• Figure: Dutch consumers value cleanliness, inherently dislike household tasks and seek to minimize the amount of time they spend on such tasks
• Figure: Two-thirds of Dutch consumers are ' frequent' purchasers of household care products on the basis of value-for-money
• Figure: Four-in-ten Dutch consumers regularly purchase private label household care products to save money
• Figure: A small proportion of Dutch consumers consider private label household and laundry products to be superior to branded equivalents
• Figure: Coles' ' Feed Your Family for Under $10' campaign is similar to an approach adopted by Sainsbury' s in the UK
• Figure: Manufacturers and retailers looking to deliver value-for-money must in the provision of factors associated with the PPI, but while also offering consumers lower than expected prices
• Figure: Datamonitor' s Recession and Recovery portal will facilitate forward thinking planning for those leading companies that start planning for the longer-term