Nielsen’s State of the Nation data reveals the latest trends in the Irish retail sector
London, UK - 29th May 2019 - New Nielsen data released today uncovers several trends in the retail sector in Ireland, including sales growth of healthy versions of ‘junk’ food. The research also indicates that Irish millennials are far behind other demographics in terms of awareness of sustainability issues, despite Ireland being the sixth best country in the EU at recycling.
Health is consumers’ second biggest concern (22%), according to SOTN. The health and wellness industry in Ireland continues to grow apace, its value standing today at €2.8 billion, having increased 5% over the past year. Limiting sugar remains the number one health concern for consumers, ahead of getting five portions of fruit and vegetables a day. Limiting salt has jumped one place to the third biggest concern for Irish consumers since last year, as has having a low or zero fat diet (fourth biggest).
The data points to an interesting behavioural insight, showing that consumers, while wanting to have a healthier diet, still wish to ‘indulge’ (or feel like they are indulging). Rather than modifying diets, Irish consumers are simply turning to ‘healthier’ versions of traditionally unhealthy categories. For example, ‘healthy’ crisps (such as those that are baked rather than fried) are growing at nearly three times the normal rate of traditional crisps (+13%), and no added sugar variants of soft drinks are growing at +27%. This compares with just +14% for the rest of the category. Non-alcoholic beer also grew a whopping +92%.
Fresh meals (ie ready-made chilled meals) and granola bars are also growing, pointing to convenience being an important factor for cash-rich, time-poor consumers.
Nielsen’s data shows that there is still huge growth among the discounters, which have grown 5% in value over the past year, and reached 20% market share last year. Discounters, such as Aldi and Lidl, have traditionally focused on private label, but as they expand their range to include many more branded products, Irish consumers now see them as offering a ‘full trolley shop’. This is a step change in the Irish retail landscape as discounters focus on branded ranges to compete directly with traditional supermarkets - it also presents a big opportunity for brands.
The discounters’ positioning of ‘swap and save’ may be the reason for consumers increasingly spending with them, given that SOTN data reveals that the economy is consumers’ number one concern (24%).
Sustainability was another big trend revealed at SOTN. Ireland ranks the sixth highest country in the EU for recycling, with 88% of Irish consumers actively recycling all the plastic packaging they can.
However, there is a big opportunity for retailers to educate millennials more, as they are the least engaged of all demographics when it comes to recycling. 90% of consumers also think that retailers should do more to reduce the amount of plastic packaging used on grocery products.
“The state of the economy continues to be a point of concern for consumers. While they are still spending, there appears to be a latent sense of trepidation feeding into their spending habits,” said Karen Mooney, Ireland Leader at Nielsen.
Mooney continued: “Amidst a turbulent economic climate, where consumers are switching to cheaper brands and products to mitigate against falling disposable income, there’s an opportunity for retailers to tap into key behavioural trends like healthier versions of old favourites. This part of the category is growing at great speed, as conflicted consumers looking to be healthier still want to enjoy the foods that aren’t so good for them. Being aware of this trend, as well as the fact that consumers are looking to the industry to drive sustainable initiatives, will mean retailers retain custom and stay relevant in a squeezed market.”