Italy emerging from the Covid-19 pandemic is described in ‘Coop Report 2021. Economy, Consumption and Lifestyles of Today’s and Tomorrow’s Italians‘. The ‘snapshot’ is compiled annually by the Ancc-Coop Study Office, in collaboration with Nomisma and with the support of major analytical facilities. (1)
Coop Report 2021, two surveys
The ‘pulse’ of the situation is taken (in addition to the usual sources) with two different surveys entitled‘Reshaping the future’ conducted in August 2021.
The first involved a sample of 1,500 Italians representative of the over-18 population (18-75 years old). The second rests on the observations of a panel of the Italians.coop website community and involved 1,000 opinion leaders and market makers. From these, 470 top roles (entrepreneurs, CEOs and directors, freelancers) were selected.
Italian pride (and GDP recovery)
86% of respondents say they are proud to be Italian. Optimism comes from brisk GDP (gross domestic product) growth, at around 6 percent, like global growth (with China leading the way). Exports have already surpassed pre Covid levels. And Italy’s newfound appeal abroad is growing, thanks to sports and music successes, but especially Mario Draghi’s premiership.
Online searches associated with the word ‘Italy’ grew by +211 percent. And 60 percent of the international business community say they are convinced of Italy’s increased attractiveness in the next 3 years and 48 percent consider it a possible destination for their future investments.
It’s not all sunshine and roses
However, the good results do not reach large segments of the population. 27 million Italians even in 2021 still experienced daily renunciations and inconveniences, 18 million expect it to last longer, and 5 million fear that sacrifices will debase even food consumption.
Consumption will be the last to restart. The majority of experts surveyed (43 percent) say Italy will return to pre-Covid levels only in 2023. In 2022, 28 percent of Italians expect to have an even lower level of spending than in 2019: they are mainly laid-off workers, young people and women. That is, the classes that are most disadvantaged in employment.
In the first half of 2021, employment rose only +1.8%). And it is feared that underemployment (59 percent), undeclared work (50 percent), and generation gaps (51 percent) will be the main ones to grow.
Desire for ‘green’
The Covid drubbing, and the recent disruptions blamed on climate change, raise awareness that the return to growth must be understood in a sustainable way. 79% of Italians say they are concerned about global warming, and 75% of executives entrust future development to technological and digital innovation.
Green sentiment spills over into food consumption. The Coop Report 2021 reports the emergence of new tribe, the climatarians. These are the consumers (1 in 6 Italians) who say they adjust their diet to reduce their environmental impact.
Sustainability at the table
The sustainable character of food is declined in various ways. For 33 percent it lies in the method of production, for another 33 percent it lies in attention to packaging, for 21 percent it stands for origin and supply chain, and for 9 percent it stands for ethical responsibility.
In consumption, meat consumption falls (reducetarians), the search for local and seasonal products grows. Veg products are also consumed by people who are just looking for a protein alternative to meat, and sales of next-generation vegan products (the beverages, bechamel, ready meals) are doubling.
For 26 percent of respondents, help will come from science and technology. Within 10 years, meat-flavored plant foods, algae-based foods, insect meal and even meat grown in vitro await on the shelves. The revolution is actually already underway. Investments in 2020 alone in next-generation food and beverages amount to 6.2 billion.
Food and Wellness
Another major driver of choice is the intrinsic quality of foods. Certification is sought after by 83%, willing to spend more. The free-from and rich-in segments continue to shine.
On the label, indications of the product’s origin and provenance are decisive for purchase for 39 percent of Italians, for 28 percent so are the nutritional values, and followed by the method of production (for 26 percent).
Branding is not enough
Unconditional trust in the brand still wanes in consumers. The brand continues to lose share, in the wake of the trend initiated by the advent of discount stores (now 20 percent of Gdo sales) and the crisis in other modern distribution channels (from 2013 to the present, the loss of share of big brands is a -9 percent) offset by Mdd (a +9 percent in the same time frame) and also by small producers (+3 percent), evidently quicker in intercepting the new changing needs of consumers.
The recovery for those in the food supply chain is quite different between industry and distribution. Both benefited from the surge in sales during the lockdown, but the food industry maintains profitability performance double that of distribution.
A GDO in transformation
Almost half of the surveyed large-scale retail managers anticipate worsening economic performance and/or having to reinvent their model of business threatened by the long tail of the pandemic recession on household incomes, the assertion of discounters that knows no respite (85 percent expect their sales to increase further), and the intensifying competitive tension among brands.
Future strategies for 45 percent of the sample need to redesign stores, perhaps pursuing an integration of the physical network with new virtual channels (39 percent) and working toward staff retraining (34 percent).
Ecommerce downsizes
Papable measures also include investments to boost online sales, a growing channel, but even after the 2020exploit (+121 percent)e-grocery remains a small segment of overall grocery sales (just above 2 percent of total GDO).
Moreover, after growth in the first half of 2021 of 46% many operators believe in the next 12-18 months that growth will stop or retreat (48%) or be less than 20% (for 43%).
The wave of price increases
In the immediate scenario, the biggest concern for large-scale retailers is the dynamics of buying and selling prices. The Report warns of the risk that food retail will remain squeezed between declining consumer food prices (-0.7 percent in the first half of 2021) and the announced increase in raw material prices and industrial supplier price lists. A gamble from which it will not be easy to get out.
‘A new phase of negotiations with the branded industry has just begun with the beginning of September, demands for an increase have already been made. I want to make it clear they are not always justified, and we will not accept raises that do not have a factual correspondence‘, says Maura Latini, managing director of Coop Italia.‘In this scenario, an organization like Coop has a great responsibility, that of being able to find convergences between what we offer, and I’m thinking of our products, the quality that goes into them and the affordability.’
Defiscalize green products
‘There is a need, as the Coop Report 2021 also shows, to Divert resources and stronger pro-consumer policies by acting, for example, on defiscalization of sustainable products, and there is a need for purposeful legislation for the redevelopment of shopping centers (…) interventions of this kind are also useful in curbing building expansion and land consumption, which continue to grow in Italy‘ says Marco Pedroni, president of Coop Italia and Ancc-Coop (National Association of Consumer Cooperatives) –
2021 with the reopening of out-of-home consumption will inevitably slow down sales. ‘We expect to end the year with retail sales in line with those of 2020. We confirm our will to be a garrison and a reference point for all Italians whatever their social status. Our goal is to provide good, safe and sustainable food for all, accessible to all income groups‘.
The full version of the Coop Report 2021 is available at http://www.italiani.coop.
Notes
(1) The Coop Report 2021 – Economy, Consumption and Lifestyles of the Italians of Today and Tomorrow is prepared by the Study Office of Ancc-Coop (National Association of Consumer Cooperatives) with the scientific collaboration of Nomisma, analysis support from Nielsen and original contributions from Gfk, Gs1-Osservatorio Immagino, Iri Information Resources, Mediobanca Ufficio Studi, Npd, Crif, Tetra Pak Italia.
Professional journalist since January 1995, he has worked for newspapers (Il Messaggero, Paese Sera, La Stampa) and periodicals (NumeroUno, Il Salvagente). She is the author of journalistic surveys on food, she has published the book "Reading labels to know what we eat".
