As turmoil in the Eurozone continues, consumers are maintaining the hard-nosed approach to shopping that they adopted post-recession. With increasing uncertainty about the global economy, combined with a rising cost of living, not only food prices, shoppers all over Europe are changing what and how they buy. 

We can see the impact in the shopper research that we conduct for clients across Europe. Nearly three quarters of shoppers, 73% of consumers across Europe, have introduced an element of planning into their routine weekly or monthly shop to combat the impulse to spend more when in-store. People are writing shopping lists and finding and using discount vouchers with far more regularity. It is also shaping other shopping patterns: the frequency of shopping and destination (to save petrol) or the number of store visited. Shoppers in France, Portugal, Greece and Italy tend to take advantage of the one-stop shop at the larger superstores whereas consumers in Germany and the UK are more likely to plan stops at multiple retail outlets and take better advantage of discounts.  

But even with a more discerning approach to shopping, the recession didn't show an immediate impact on consumers' food purchases. Shoppers tended to cut spend in other areas such as out-of-home treats or non-food purchases where they were able to benefit from an increase in the number of promotions available to them. With the exception of the UK and Germany, most European countries showed an increase in the cost of the weekly grocery shop and the number of items purchased as people changed their social behaviour, spending more time cooking at home for friends and family rather than eating out.  

Only now is the full impact of the perilous economic situation starting to hit shoppers. In the UK and Germany we saw for the first time this year a decline in the volume of food and non-food items that consumers are purchasing in their weekly shop at the same time as a continued rise in the cost of the weekly basket. Households are struggling to contain everyday expenditure in their squeezed budgets. There appears to be a limit to how far the weekly grocery budget can stretch as consumers grapple with the rising cost of food prices. 

You might expect consumers to simply be switching to retailers' own-label brands in an attempt to keep the rising cost of their weekly supermarket shop in check. Yet our research shows that consumers in Europe are shopping much more discerningly than this. Own label is growing in most markets but only slowly and not in all categories or countries. The sustained recessionary pressure is not the end of brands – although it is clearly a major stimulus for consumers to revisit the value they are getting from their current product repertoire. The same rather sophisticated approach to locating value is even evident in strong national brand markets like the US. Here, although value growth continued, the unit share of private label dipped this year as retailers made stronger price increases - evidence that the recessionary shopper is a careful judge of value.

This same careful judgement has been seen over the last few years in the UK where until recently the relentless rise in promotional expenditure by brands has pushed a mature retailer own-label offer back in many categories. The national brands have been using seemingly ever more aggressive price promotions to appeal to the consumer demand for saving. 

However, this dangerous strategy looks to be reaching its limit as levels of promotion have flattened and manufacturers have sought to put through price increases to recover eroded margins and exploding commodity costs. The result is a sign that shoppers' search for value has moved on again – to own label and to restricting their overall budgetary spend.    

The good news is that we have recently detected a pause in promotional escalation across Europe. The challenge is that this suggests that the pressure will simply move to other aspects of the marketing offer – brand choice, category choice, volume, everyday prices – any area that will enable shoppers to maintain control of their spend and realise maximum value.

Value is a unique equation in each category and for each consumer segment. As consumers look beyond the cheapest headline to the best value for money, they'll spend more if they think it's worth it. This perception of value is incredibly important and one that brands need to leverage. The focus cannot simply be on using sales volumes to achieve profit. A strategy based on volume growth is more likely to fail in these conditions than succeed as the growth will be too expensive in the face of a more value sensitive consumer.

We expect shoppers to consume less in the future but to look more closely at the value and factors of what they buy. Factors such as sustainability, health, environment and even convenience will become increasingly important. Nonetheless, brands do provide a valuable shortcut for consumers' decision-making process and we expect that, even as share of voice for private-label products continues to grow, those brands that sustain their meaning and relevance will still play a strong role. 

We are entering an era of conscientious consumption where brands need to look at the real value that the product gives to the consumer and then leverage each price point to achieve the best margin and deliver the most return - with different, perhaps lower, volumes of sale. People still want to buy brands that they trust but they no longer do so indiscriminately – if they ever did.