Italian consumption: low, very low. Indeed, improving.

consumi in Italia
Michele Caprini
06 Aug 2020

In 2020, Italian food consumption will register a fall of 10%. This is the estimate of two weeks ago by Coldiretti, who linked this to the inevitable collapse of the catering sector, not offset by the modest revival in domestic spending.The not very encouraging outlook predicted an overall cut in household and out-of-home food expenditure of €24 billion by the end of the year.  

With the end of the lockdown, the beneficial effect on domestic expenditure from the rush to stockpile, as a result of unfounded fears about supplies running short, gradually faded to return to values slightly above average.

Possible consumption maps

As reported by Confcommercio-Censis, 42.3% of households experienced reductions in work and pay, 23% definitively abandoned the planned purchase of durable goods (furniture, home appliances, cars), and 48% has given up any type of vacation (weekends, Easter, summer holidays).

The forecast of two months ago pointed to an overall reduction in current year spending of €84 billion. According to Confcommercio Studies Office, within the most affected sectors were clothing (-9%), transport (car purchases -16%), entertainment, media and culture (-17%) and, above all, catering and hospitality (-37%). Conversely, food consumption was estimated to grow by 3.6%.

According to FIPE, the leading catering and entertainment trade association with nearly 300,000 members, “There are still many shadows and too few lights two months after the reopening. The average fall in turnover went from 50.3% in the first month of opening to 41.1% in the second. While this is a positive sign, it is not enough to support businesses”.

The ‘augmented consumer’

The GFK survey on ‘Social and consumer climates’, conducted in June on Italian business managers, shows that there is a 44% risk of a lower propensity to purchase among consumers.The market research company talks about the weakening of the impulse to self-concessiveness in purchases, coining the neologism ‘augmented consumer’.The spending of this new consumer supported by greater technological confidence, would be an expression of the habits and needs developed in recent months. From these, the consequent review of consumption priorities and, for many, also of new lifestyles.

Reversal of trend?

The recent edition of the Deloitte ‘Global State of the Consumer Tracker’, which monitors on a fortnightly basis the trend in consumption, notes that consumer confidence has returned to the positive sign.Today, 60% of Italians would be confident in returning to the store and purchasing products. On the other hand, the tendency to order grocery online is falling steeply compared to the volumes seen during the health emergency.

A positive trend also for out-of-home consumption. When bars and restaurants reopened at the end of last May, only 31% of Italians were confident about eating out, while two months later that figure increased to 45%, with younger consumer groups making it jump even further to 51%, six percentage points higher than the national average.

Moreover, in the last two months or so, this consumer segment preferred, more than any other group, take-out food: +3%, compared to an average of -15%.

Similar behaviour towards clothing products, for which spending intentions are higher than for other product categories: +15%, against an average of -10%.

However, also for the Deloitte’s researchers 44% of Italian consumers continue to postpone the most important purchases with 29% of them worried about meeting future payments.

The race for online services

Lastly, the analysis of GoDaddy, one of the most important cloud platforms in the world, which targets the small companies segment, is of no small interest.According to GoDaddy, during the pandemic, a fifth of these Italian enterprises activated online sales and/or delivery services, abandoning, in the great majority of cases, the use of large food delivery companies.

Catering micro-businesses were the most enterprising: for 23% of these the promotion of products and the collection of orders go through WhatsApp, for 14% with an e-commerce channel, for 9% through social media.

A telling Autumn

The next few months will shed more light on the real prospects of the country and the eurozone.Concerns regarding GDP, employment and consumption are self-evident and not worth discussing.Important, if not the most important, could be the level of immunity to the crisis acquired by Italian companies and the distribution sector, which with the time available has not yet been possible to verify.