Germany‘s FMCG market during the corona crisis

It is hardly surprising that Germany’s consumer climate, which comprises the economic climate, income expectations, and buying mood, is crashing. And the results are even more substantial than during the financial crisis twelve years ago. GfK’s consumer climate index was still a 9.9 in February 2020 but dropped to 8.3 in March, with a forecast for April at 2.7.

The current situation has of course a significant impact on purchasing behaviors when it comes to fast moving consumer goods (FMCG) in Germany. Overall, Germany’s FMCG market has benefited significantly from the corona crisis, as all stores of the food retail sector are allowed to remain open during the general shutdown. According to GfK, the FMCG market increased by 8.5% in comparison to the same time period in the previous year, with a particularly strong spike in February of 14%. This was already the first impact of the changes in connection with corona. All of the food retail sector’s sales channels benefitted from this trend, especially full-range food providers with an increase of 16% in February alone, in comparison to last year. Looking at the product groups, one can clearly see that all categories benefitted from this trend. However, those products that can be stockpiled already did particularly well in February, including anti-alcoholic beverages, paper goods (especially toilet paper), or other food products like noodles.

Roast coffee, beer, cola beverages

An in-depth analysis of the product groups’ development in March shows several interesting trends. According to GfK, the winners are product groups that are usually also consumed outside of people’s homes under normal conditions, like roast coffee, beer, cola beverages, all experienced a significant boost in comparison to the previous year. Out-of-home consumption is taking place more and more at home during the corona crisis. This trend is a blessing for some and burden for others: Some product groups, like certain kinds of cosmetics, are coming under severe pressure because people have been leaving their homes less frequently since the beginning of the shutdown.

Overall, consumer behavior is changing rapidly in these difficult times. It remains to be seen, where these shutdown-related developments will lead, but also of course which effects will kick in after a potential normalization of the situation.