Paris, March 14, 2024. French consumers’ spending on FMCG and T&D products reached €238.6 billion in 2023. Revenues increased by +6% compared to €225.2 in 2022. Due to the high level of inflation, sales of FMCG products are increasing the most significantly (+8.8% between 2023 and 2022). On the contrary, French consumers lowered their purchases for non-essential goods, so spending on non-food products reduced slightly (-1.0% between 2023 and 2022 – €63.9 billion in 2023 vs. €64.6 billion in 2022).  

The NIQ Retail Spend Barometer combines data from NielsenIQ and GfK. It provides a complete view of retail turnover in France and spending on consumer goods (food, beverages, fresh and hygiene products) and non-food products (technical goods, household appliances, DIY-gardening). This cross-functional, multi-channel overview, based on actual sales data, is unique to date. It will be published quarterly. 

“Market dynamics and consumer behavior are changing faster and faster. In a competitive environment, fragmented data and a dose of intuition are no longer enough, says Michael McLaughlin, president of Global Retail at NielsenIQ. The strength of NielsenIQ and our Full View™ approach, based on our multiple data sources, allow us to provide a comprehensive understanding of market developments and consumer trends in France, Europe and globally. ” 

Inflation boosts FMCG sales 

According to the barometer, spending on food (groceries and beverages) showed the largest increase (+9.4%). The peak in spending occured in the first quarter of 2023 (up +11.7% year-on-year) and fell to 6.4% in the last quarter. Expenses in home & personal care products followed with an increase of +7.6% and finally those for fresh products (+7%). Obviously, the unprecedented annual inflation rate of +12.2%, with a monthly peak of +13.6% in April 2023, contributes significantly to these increases. 

Recent NielsenIQ studies reinforce the barometer’s findings and give perspectives. In particular, they showed that 1 out of 2 French households declared being weakened by the purchasing power crisis in 2023. 2023 was also a pivotal year for private labels as their market shares reached its highest level since 2017 at 20.9% in volume. Today, 1 out of 2 products purchased by families comes from a private label. With the long-lasting inflationary crisis, private labels are now part of the daily lives of French people. Among their top 10 strategies to save money, search for best prices is n°1. 47% of them compare prices more carefully, 44% buy more on discounts, 38% buy less meat and fish. 2023 was an unprecedented year that might have transformed the French FMCG market on the long-term. 

“2023 did not meant the same for all consumers. 22% of French ones still limit spending on food and other daily essentials. Consumers are arbitrating and trying to limit waste. They became vigilant when shopping, looking for opportunities to save money at all means. To manage their budget more efficiently, they tend to divide purchases into smaller carts while increasing frequency of their visits in points of sale or even changing from their usual store. Spending constraints are expected to be a significant factor influencing the market in 2024 and beyond,” comments Daniel Ducrocq, Retail Lead for Western Europe, NielsenIQ. 

Trade-offs at work on Tech&Durables markets 

Non-food markets reported a decline in 2023 results. Despite notable drops in last quarter spendings of -2.9%, French consumers spent €63.960 billion in Tech and Durable goods in 2023, a rather slight decrease of -1.0% compared to 2022. Turnover generated in DIY/Gardening and Technical Goods respectively represents 1 ⁄ 3 of French non-food markets. 

Spendings on DIY-Construction-Gardening-Petcare are the only ones increasing by +2.5%. In regards, Technical goods markets (Consumer Electronics, Telecoms, IT-Office) fell by -4.9% in value while spendings for household appliances showed a contained decline of -1.6%. 

According to the barometer, non-food markets performances were relatively stable in the 1st half of the year: -0.9% in Q1, stable in Q2 and Q3. Over this period, spending on DIY-Gardening-Construction products maintained a quite dynamic level of activity, largely due to the increase in average paid prices: +3.0% in Q1 and Q3, up to +6.0% in Q2. Thus, this compensated the decrease of technical goods markets in Q1: -0.9% in household appliances and -6.7% in high-tech & IT products. 

Historically, the last quarter is the peak season for T&D markets. However, Q4 activity contracted as market faced a strong historical effect (Football World Cup in Qatar combined with Black Friday and end-of-the-year discounts) and still significant pressure from inflation on consumers’ budgets. All product lines showed negative performances, ranging from -0.8% in household appliances to -3.9% in consumer electronics / IT / telecoms. 

According to recent GfK studies, Tech Stores capture 56% of Domestic Appliances and Technical Goods category turnover and continue to gain market share. French consumers prefer to buy in stores (€7 out of 10 spent). Aside from this key fact, E-commerce sales (excluding marketplaces) reached a certain plateau and represent 29% of total revenue. 

As far as DIY/Gardening categories are concerned, consumers’ preferred channel remains unsurprisingly DIY Specialized stores, along with Garden Centers and Motor Gardening Specialists. E-commerce is arising : first sales records for Garden/Decoration markets estimate the online channel at less than 10% of revenue generated. 

Some nuances can be observed depending on the product categories. On the one hand, clear decline in sales for Telecoms markets (-4% in new smartphones), consumer electronics (-5% in Televisions, -5% in Audio) and Computers ones (-12% in laptop sales). At the same time, dynamic remains for Photo and Hybrid Digital Cameras (+17%), Bluetooth headband headsets (+16%) and Gaming IT Accessories (+7%). Last but not least, stars of the year on domestic appliances markets are undoubtedly oil-free fryers, which turnover increased by +113%, followed by wet and dry vacuum cleaners (+31%). 

In DIY / Garden markets, the scope is large and product sales highly weather-sensitive. On the one hand, categories in decline such as watering products (-6%), barbecues (-8%) and HVAC (-13%).On the other hand, Products for Garden increased – including insecticides (+3%), Motorized garden (+1%) and Paint/Decoration (+2%). 

“Until now, non-food markets were under the influence of high levels of equipment triggered by the pandemic and lockdowns in 2020/2021. Since then, household confidence has been at half-mast, the economic and social context got tense, so French consumers are cautious, arbitrating spending and postponing their projects. For example, 1 out of 3 real estate projects has been postponed, whether on the purchase/move side or renovation work. Together, these factors have a huge impact on durable goods sales,” adds Daniel Ducrocq.   

For more information, please visit NIQ Retail Spend Barometer (nielseniq.com) 

About the study   

The NIQ Retail Spend Barometer examines consumer spending on FMCG and T&D products in Germany. It tracks real sales figures and measures changes in past purchase trends. The FMCG categories covered include food, groceries, perishables and near-food, and the T&D categories include technical consumer goods, household appliances and DIY. The data comes from NielsenIQ and GfK retail market measurement, which together measure the sales of over 350,000 retail partners worldwide.

About NielsenIQ 

NIQ is the world’s leading consumer intelligence company, delivering the most complete understanding of consumer buying behavior and revealing new pathways to growth. In 2023, NIQ combined with GfK, bringing together the two industry leaders with unparalleled global reach. With a holistic retail read and the most comprehensive consumer insights—delivered with advanced analytics through state-of-the-art platforms—NIQ delivers the Full View™. 

NIQ, is an Advent International portfolio company with operations in 100+ markets, covering more than 90 percent of the world’s population. For more information, visit www.NIQ.com. 

About GfK | a NielsenIQ company 

GfK has earned the trust of our clients around the world by solving critical questions in their decision-making process. In 2023, GfK combined with NIQ, bringing together the two industry leaders with unparaAbout lleled global reach. Together, we fuel client’s growth by providing a complete understanding of their consumers’ buying behavior, and the dynamics impacting their markets, brands and media trends. With a holistic retail read and the most comprehensive consumer insights – delivered with advanced analytics through state-of-the-art platforms – NIQ and GfK deliver the Full View™.