the bulgarian fmcg market in 2016 -...
TRANSCRIPT
CONSUMER BEHAVIOUR & KEY CATEGORIES
ANGELOS GEORGIOU & NIELSEN BULGARIA TEAM SANDANSKI, 19 MAY 2016
THE BULGARIAN FMCG MARKET IN 2016
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THE BULGARIAN FMCG MARKET: TOPLINE PERFORMANCE & KEY CATEGORY
MOVEMENTS
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FMCG MARKET IN BULGARIA (2015 VS. 2014)
0.3%
-0.4%
0.5% 0.3% 0.1%
-0.8% -0.7%
0.0%
0.9%
2.2%
0.3% 0.1%
2.0%
3.6%
2.7%
0.9%
1.1%
1.9%
0.8%
0.4%
2.0%
2.8%
1.9%
1.0%
2014 2015 Dec-Apr 14 Apr- Aug 14 Aug-Dec 14 Dec-Apr 15 Apr-Aug 15 Aug-Dec 15
-2%
-1%
-1%
0%
1%
1%
2%
2%
3%
3%
4%
4%
Price change Volume change Value change
Source: Nielsen Bulgaria Retail Index
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Value change Volume change
+2.4% +0.5% +1.9%
FMCG MARKET IN BULGARIA (YTD MARCH 2016)
Source: Nielsen Bulgaria Retail Index
Price change
Price inflation is back!
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ALCOHOL ONCE AGAIN DRIVING THE GROWTH, BUT POSITIVE TREND FOR FOOD AND DRUG AS WELL.
Source: Nielsen Bulgaria Retail Index (MAT March 2016 vs. YA)
MAT performance (2016 vs. 2015)
1.5% 1.3%
2.9%
1.1%
2.0%
1.7%
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
Food & N.A. Drink Drug Alcohol
Value
Volume
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IN FOOD THERE IS STRONG PERFORMANCE FROM N.A. BEVERAGES, WHILE CHEESE AND MEAT HAVE NOT RECOVERED YET.
Source: Nielsen Bulgaria Retail Index (MAT March 2016 vs. YA)
BEER
CARBONATED SOFT DRINKS
MEAT PRODUCTS
COFFEE
YOGURT
BOTTLED WATER
WHITE CHEESE
FRUIT JUICES
WHISKY
TABLE WINE
-0.08
-0.06
-0.04
-0.02
0.00
0.02
0.04
0.06
0.08
0.10
0.12
0.14
-0.10 -0.05 0.00 0.05 0.10 0.15 0.20
Top Food Categories in Bulgaria; Growth in Value and Volume
Value change
Vo
lum
e ch
ange
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8 Source: Nielsen Bulgaria Retail Index (MAT February 2016 vs. YA)
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European Average
78 Top 10 105 Denmark 97 U.K. 97 Czech rep. 97 Germany 96 Turkey 95 Ireland 91 Switzerland 86 Sweden 85 Netherlands 83 Austria
Bottom 10 64 France 63 Russia 63 Finland 61 Serbia 61 Hungary 60 Slovakia 59 Italy 53 Greece 50 Belarus 46 Ukraine
73
77
72
77
BG
EUROPE STILL DIVIDED INTO CONFIDENT NORTH WEST AND PESSIMISTIC EAST
Source: Nielsen Global Consumer Confidence Survey (Q1, 2016)
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Job security
serious concern of the Bulgarian consumers and number 2 for Europeans
19% 21%
WORK LIFE BALANCE RETURNS TO THE TOP OF THE “LIST OF CONCERNS” FOR BULGARIANS
BULGARIA EUROPE
Increasing utility bills 5th concern for Europeans 14% 17%
Health
Bulgarian consumers feels the pressure more
24% 17%
Crime
Worries 2x more Bulgarians than Europeans 14% 7%
Work Life Balance
worries every 4th Bulgarian 27% 9%
Main concern for Europe: Terrorism – 22%!
Source: Nielsen Global Consumer Confidence Survey (Q1, 2016)
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THREE TAKE OUTS FROM THIS SESSION
The Bulgarian FMCG market is growing by approximately 2% in Value, slightly outperforming the European average.
Alcohol is leading the way, while there is also positive trend for Food and Drug categories. Price inflation is starting to make a return though, which could become a threat going forward.
Consumer confidence is catching up with the rest of Europe. Combining this with some “healthy” Macroeconomic performance recently it means that Bulgarian consumers are more likely to spend.
DISCOUNTERS & PRIVATE LABEL
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MARKET SHARE DISCOUNT IN EUROPE
9.7% 10.9%
11.8% 13.1%
14.1% 14.6% 15.1% 15.4% 15.4% 15.2% 15.0% 16.0% 16.6% 17.1% 17.1% 17.4% 17.8% 18.5% 18.5% 18.8% 19.2% 19.4% 20.0% 20.6%
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Source: Nielsen Retail Index (Total Europe)
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SHARE OF DISCOUNT STORES IN EUROPE
Less than 15%
15% - 30%
above 30%
8%
10%
10%
16%
11%
17%
22%
17%
43%
15% 13%
62%
41%
42%
13%
27% 20%
24%
26%
20%
21%
EST. 18-19%
9%
8%
8%
2%
12%
24%
11%
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PREDICTABILITY OF DISCOUNT Number of stores required for 1% market share
7.5
10
15
20
25
30
30
30
35
35
35
40
50
60
60
125
140
300
390
425
430
Bulgaria
Slovakia
Ireland
Greece
Hungary
Sweden
Czech Republic
Belgium
Austria
Norway
Finland
Denmark
Netherlands
Switzerland
Portugal
Poland
UK
Spain
Germany
Italy
France
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PRIVATE LABEL
PRIVATE LABEL IS MAINLY A EUROPEAN THING & IT IS GROWING ALMOST EVERYWHERE.
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3.0%
3.5%
3.7%
3.6%
4.4%
4.7%
2016
2015
2014
Volume Value
SHARE OF PRIVATE LABEL IN BULGARIA (2014 – 2016) Over the last 2 years the share of P.L. in Bulgaria has decreased as sales have
dropped by 17% in Value and 21% in Volume.
Source: Nielsen Bulgaria Retail Index (* Alcohol categories are excluded / Lidl’s share is not included)
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THE PRICE DIFFERENCE BETWEEN BRANDED AND P.L. PRODUCTS IN BULGARIA IS 19%, A SMALLER GAP THAT IN U.K. AND SEE REGION
18 Source: Nielsen Retail Index (various European markets)
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56.7%
20.6%
14.7%10.8% 10.0%
6.6% 6.5% 6.0% 5.8% 5.2%0%
10%
20%
30%
40%
50%
60% Ice coffee
Margarine
Spread cheese
Pet food
Milk
Nuts
Baby diapers
Chips
Flour
Croissant
Categories with the highest Value share of Private Label
THERE ARE ONLY 5 CATEGORIES WITH DOUBLE DIGIT SHARE OF PRIVATE LABEL IN BULGARIA
Val Ch. 24.3% -35.2% 36.6% -11.7% 0.6% -28.1% 12.5% -7.7% -44.3% -2.6%
Source: Nielsen Bulgaria Retail Index
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P.L. - Best Performing Categories (Value change vs. 2YA)
CATEGORIES WITH THE BIGGEST GROWTH AND DECLINE IN SALES OF P.L. OVER THE LAST 2 YEARS
P.L. - Worst Performing Categories (Value change vs. 2YA)
-66.9% -63.5%
-47.2% -44.3%
-80.0%
-70.0%
-60.0%
-50.0%
-40.0%
-30.0%
-20.0%
-10.0%
0.0%
Pretzel Sweet Cakes Meat products Flour
37.7%
24.4% 24.3% 24.2%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
Face care Pralines Ice coffee Energy drinks
Source: Nielsen Bulgaria Retail Index (* Categories where P.L. is at least 2% of Value sales)
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BUT P.L. IS NOT ONLY THE “CHEAP, VALUE FOR MONEY” ALTERNATIVE ANYMORE. PREMIUM P.L. IS BOOMING
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DISCOUNTER RELEVANCE
BRAND LOYALTY
NEW GEN P.L
MOVE TO MAINSTREAM
Market fragmentation and low disposable income mean that there is still ground for growth. New player (KAM) entering in June
Although Bulgarian consumers are gradually becoming more rational, they are still the most brand loyal in Europe
P.L. is limited in terms of assortment & positioning. Offering wider choice and distinct price advantage vs. brands will be key
DISCOUNTERS & P.L. – WHAT SHALL WE EXPECT IN FUTURE?
Discounters are becoming more mainstream by increasing the share of brands, investing in non food categories & online and advertising P.L. like brands
