MANILA – According to a study by Kantar Worldpanel, Filipinos are choosing more premium items, particularly for personal care products. The world leader in consumer knowledge and behavior analysis notes that 24% of categories in the fast moving consumer goods (FMCG) segment showed an ‘uptrading’ trend, manifested the most in facial care, colognes, hair colorants, hair styling, talcum powder, toothpaste, razor, and liquid soap product lines.
The study, based on 3,000 respondents across urban and rural areas, reveals that Filipinos are ‘uptrading’ or choosing more premium products with additional benefits compared to traditional product lines they patronized in the past.
“Our data from February 2014-January 2015 shows that consumers are now more receptive to facial care products with anti-aging benefits, which are five times more expensive than average facial care products. Moisturizers are also becoming in-demand as consumers spend more on this product compared to astringents or exfoliants and facial washes,” said Lourdes Deocareza, New Business Development head at Kantar Worldpanel Philippines.
She added that liquid soaps from relatively higher priced brands are also gaining in popularity compared to regular bath bar soaps, with an 8% increase in sales in 2015.
‘Uptrading’ is likewise seen in the food category. Kantar Worldpanel reveals that Filipinos are showing an affinity with expensive cooking oil such as palm oil and canola oil. Meanwhile, newer formats of cheese products like grated cheese, though priced higher, are gaining more customers. The same trend has been seen in seasoning powder, baby food, mayonnaise, and sugar.
According to the study, urban and rural consumers are both ‘uptrading’. The study also presents a difference in categories of the premium items rural and urban homes choose to spend their money on, with the food category being the only one with identical ‘uptrading’ rates for both urban and rural homes.
The inclination towards premium items interestingly cuts across income classes. Upper class homes choose high-end cosmetics/make up, hand and body lotions, juices and tea products, while DE homes lean toward more premium facial care, milk powder, and toothpaste items.
Kantar Worldpanel anticipates the ‘uptrading’ trend to continue. “Consumers are becoming more aware of the different brands and products that are available for them to choose from, especially with the advent of social media and digital advertising. At the same time, consumers are now more sophisticated, seeking additional product benefits beyond just the basics,” said Deocareza.
