France

General economy

• Although the first quarter of 2009 resembled that of 2008 the French GDP declined in 2009 as a result of the global financial crisis and inflation. Despite this, slight recovery was seen in the second semester.

► Experts now expect a 1.4% growth in 2010 – a much higher figure than was expected just six months ago.
► Inflation stopped due to the falling prices of commodities.
► Unemployment has risen to 9.8% and is expected to continue to rise.
► Private consumption has remained constant in the French economy whilst FMCG products are experiencing a period of growth once again, having declined in 2008.

 

Key drivers in FMCG categories

► In 2009 there were three key categories which spurred on FMCG sales in France – products which are convenient and easy to use (such as Smoked or Canned Fish, Cooked Meats and Pre-packaged Bread), Luxuries or Treats (for example Foie Gras, Chocolate Bars and Alcohol) and Fresh Produce.
► Good weather in 2009 meant that sales of Soft Drinks were high, although families with children were less inclined to buy Soft Drinks.
► Private Labels experienced the highest sales to date.
► Despite the crisis, consumers did continue to buy some of the more expensive products.
► Organic produce and new products continued to perform well.

 

Retail trade

► Having had a very successful year in 2008, hard-discounters suffered in 2009 - their core clientele falling slightly.
► Other retailers have managed to claw back sales from such Discounters with the help of Private Labels which climbed to an all time high in 2009 before levelling off towards the end of the year.
► Leclerc, Carrefour and Système U all increased their market shares over the year. Shoppers were less loyal to their main retailer, mixing more shops to get best bargains.

 

Media

► Media investment slowed down throughout the year with companies freezing their expenditure during the financial crisis.
► FMCG companies were more confident in their advertising, spending 12% more than they did in 2008.
► Internet Advertising was still the most active area in advertising however even this method experienced a slow down in 2009.
► Television remained crucial to Media Planning, increasing by 5%.
► Radio Advertising experienced a 9% increase whilst the press and Outdoor Advertising suffered declines in usage.