The Swiss are sweating this summer after a rather chilly winter. The summer of 2018 will most likely be one for the books, with temperatures exceeding those measured in 2003. At the same time, Switzerland is facing some of its driest months in about 100 years, with a rainfall deficit of more than 50% in some places. It is therefore understandable that Swiss consumers are looking for ways to escape the heat: be it by jumping into the cool waters of Switzerland’s many lakes or by consuming refreshing food and beverages.
So which FMCG categories benefited from the glorious summer?
Comparing June - August 2018 with June - August 2016, FMCG growth overall was rather stable (+1%). However, some categories showed significant growth compared to others. Food categories such as ice cream and convenience, in particular, are profiting from this hot summer, with revenue sales increasing by more than 14% compared to the summer of 2016. These categories are typically consumed “on-the-go”, perhaps after a swim in the lake or after an excursion. Consequently, convenience channels have shown a significantly stronger growth in some food categories (like alcoholic beverages) than traditional retailers. Savoury snacks are also showing an increase in value sales of 7%. This might be driven by an increase in the number of barbecues and social events focused around the FIFA World Cup. Along the same line, ready-to-grill meat platters have multiplied their revenue sales by up to 700%. On the other hand, other categories such as sweets (candy, chocolate, etc.) have been struggling with the high temperatures and have been facing decreasing value sales.
Beverages especially have shown a positive development within all sub-categories. Swiss consumers have stated that tap water and store-bought mineral water are their preferred sources of liquid refreshment in the summer. 57% estimated their daily water-intake to be between 1-2 liters, with 34% drinking even more than two liters. It is therefore not surprising that the water category has been growing by 11% compared to the summer of 2016.
Carbonated and non-carbonated soft drinks have shown the highest increase in value sales next to water. This can be explained in part by the many “healthier” options that have become available on the market over the last year, making this category more attractive again. Within the alcoholic segment, the rather small segment of alcopops is showing an impressive value sales increase of 51.6%, driven by younger millennials. Over 35s, on the other hand, prefer beer, cider and spirits.
It can indeed be shown that temperature, as well as hours of sunshine, have a positive influence on some food/beverage categories. However, the slow growth of total FMCG indicates a shift rather than an increase in consumption overall. It is therefore very important for companies to track weather changes in order to be able to react appropriately by applying measures that enable them to profit as much as possible from weather effects.
To reduce the “Soccer Effect” as much as possible in this analysis, we compared the summer of 2018 (World Cup in Russia) with the summer of 2016 (European Championship in France). This allows for a thorough and appropriate comparison of weather effects across different categories.