2023.04.18

Next stop: Recovery

In tough economic times, we consume new, cheaper brands or buy the branded products we really trust. At least according to the latest digital seminar on consumer technology and consumer goods by the analysis company Growth from Knowledge (GfK). 

On March 29, 2023, GfK organized a seminar entitled "State of Consumer Technology and Durables Webinar – Next stop recovery?" where Nevin Francis, Director Global Strategic Insights at GfK, spoke about global market developments and trends in 2022. Nevin Francis said that consumers do one of two things in tougher economic times, either they choose to purchase products from a different, and cheaper, brand than they usually do, or they buy a brand product they trust - but then they often wait for promotions to buy what they want at a better price, provided that the purchase does not concern must-have products such as refrigerators or vacuum cleaners. 

GfK figures show that 35 percent of consumers in 2022 switched brands to a cheaper alternative when buying a must-have product and that 48 percent of consumers waited for a promotion before buying the product they wanted. 

“Premium products always fare better in tough times than entry-level and mid-range products,” said Nevin Francis. 

As an example of this, he mentioned that hobs decreased by 8 percent in value in 2022 while hobs with built-in fans increased by 12 percent, and refrigerators fell by 6 percent while refrigerators with French doors increased by 3 percent. 

MDA and SDA fared best

GfK reported global sales in value in 2022, and of the seven categories into which consumer technology and sustainable products were divided, MDA and SDA performed best last year, with -6.7 percent and -7.3 percent respectively compared to 2021. Comparing 2022 with 2019, MDA increased by 5 percent and SDA by 16 percent. 

When asked what they would do and focus on in the next few months, if they could only do one thing, the seminar participants responded as follows.

– Focus on needs innovation, such as energy efficiency within MDA, said Nevin Francis. 

“Create as easy a path to purchase as possible,” said Alexander Dehmel, Head of Market Intelligence Germany/Austria GfK. 

– Don't see marketing as a cost but as an investment and build the brand for the long term, said Catherine Gibson, Global Head of Consumer Segmentation and Growth Activation GfK. 

Text: Ola Larsson