CONSUMER SPENDING on food grew last month for the first time following 17 consecutive months of decline, the latest market figures show.
While the increase was just 0.5 per cent, further tentative signs of recovery could be seen in a levelling out of consumer confidence, according to Tom Harper, managing director of market research firm Nielsen Ireland.
“The worst is over and we’re coming out of it,” he told the National Dairy Council (NDC) annual conference yesterday. However, Mr Harper warned retailers that consumers were “stressed out” and shopping more than ever in search of value, and that this habit would stay with them when the slump was over.
The growth of discount stores such as Lidl and Aldi and a rise in the popularity of own-label goods would continue, even in a declining market, he predicted.
Five years ago, one-third of consumers said they did one big shop a week, but by 2010 this figure had declined to 6 per cent as shoppers divided their purchases between different stores.
Mr Harper said that the largest multiple, Tesco, had held its own in the face of competition from the discounters but Dunnes Stores was not doing so well. In 2005, consumers perceived Tesco and Dunnes to be the cheapest retailers but today, when asked the same question, 35 per cent said Lidl was cheapest, 28 per cent named Tesco and 21 per cent said Aldi.
Although prices were broadly similar in Tesco and Dunnes, consumers perceived Tesco to be cheaper, he said.
As consumers grew into the habit of choosing own-label goods over well-known brands, there was a danger that the word “Irish” would fall off the packets of some well-known home-manufactured goods.
Prof Pat Wall of UCD’s department of public health told the conference that the Irish agriculture sector needed to defend the worth of its products more vigorously. Dairy products and red meat had been vilified, yet Irish milk was unique in its quality.