The constant escalation of inflation resulting from the war in Ukraine has generated a “new scenario” of prices. Since the beginning of the conflict, the price of some products – especially food and fuel – has reached record highs and this has forced many consumers to look for new ways to reduce expenses. Consuming more white label products, sharing a car or buying second-hand clothes have been some of the solutions. Experts confirm that the invasion has caused changes in consumption patterns, but they deny that some companies have “taken advantage” of the general rise in prices to make cash. For their part, consumer associations question this and denounce “unfair” practices by some manufacturers.
The war in Ukraine broke out in a context in which prices were already climbing as a result of the economic recovery after the pandemic. “It’s as if an injury catches you untrained, catches you badly and makes you recover worse”, compares the professor of the EAE Business School, Àlex Alegret. Thus, although the Spanish government approved in March a first package of measures to reverse the general rise in costs, prices continued to rise and hit a ceiling in the summer.
«In the end, you have a pocket, some money goes into it, and with this money you have to organize your life. And it all starts with sleeping, eating, drinking and getting dressed. If you keep raising the price of everything, then obviously you will pay for it, but you have less and less,” sums up Alegret, who remembers that wages have not risen in the same way that prices have. This would explain, according to the business school professor, that many consumers have been forced to look for alternatives to spend less and have changed their buying habits.
Rise of white marks
The shopping basket is one of the things that has skyrocketed in price over the last year. In fact, according to an analysis by the consumer association Facua, one in four foods has risen by more than 30% in the last twelve months. Along the same lines, a study by the association of manufacturers and distributors Aecoc indicates that seven out of ten consumers are now paying more attention to prices and promotions when making their purchases and almost nine out of ten admit to having changed their usual brands for cheaper ones. A clear effect of this is the increase in white marks.
«What the consumer does is to control their expenses much more so that their budget is stretched further, we all plan our purchases more”, explains Aecoc’s strategy and marketing manager, Rosario Pedrosa. He also points out that buyers are “more unfaithful” both to their usual brands and to the establishments they frequent with the aim of finding the best prices. “The consumer is now a hunter of opportunities”, he emphasizes. “The price becomes an important variable”, he adds.
Less quantity, same price
The rise in food prices has caused some manufacturers to engage in “unfair” and “opaque” practices to avoid raising the price of products. This is what the Organization of Consumers and Users (OCU) has reported to the National Markets and Competition Commission (CNMC). In particular, the consumer association filed a complaint in June against six companies of packaged products that offered less quantity charging the same price, a phenomenon known as “reduflation”. “The typical example is the bag of potatoes, which used to be full and now half is air”, exemplifies the spokesperson of the OCU in Catalonia, Esther Lorente.
The organization assures that it has not yet received a response from the CNMC, but warns that redufflation is a practice that is becoming “standardized” among packaged products in the current context of inflation. It also indicates that it is not only found in food, but has also been detected in personal hygiene or cleaning products. Lorente points out that the association will make sure to denounce this type of practice and get sanctions imposed. “We will be very much on top so that coercive fines are applied and that it is not more economical for the brands to pay the fine than to continue carrying out these practices”, he defends.
Use of shared car
Aside from food, fuel has also shot up in price over the last year -in the summer they exceeded the threshold of two euros per litre-. While to reduce costs some users have chosen to use public transport, bearing in mind that the rates are frozen and that Renfe tickets are subsidized, others have chosen to share a car using applications such as Blablacar.
This is the case of Eva, from Palafrugell (Baix Empordà), who usually goes to Barcelona two or three times a week for work. He has been using the application for half a year now and says he has managed to save up to 300 euros a month. Exactly, what the diesel cost him to go and return to Barcelona. “It’s not a business for me, but it does help me pay what I would spend on fuel if I made the trip alone, leaving aside all the other expenses associated with the vehicle”, he specifies (such as maintenance, insurance or tire wear).
On average, Eva usually wears between two and three people per trip. Not only residents of Palafrugell, because if necessary – and as long as it doesn’t mean wasting too much time – he also collects them in other municipalities he has to pass through on his way to Barcelona (for example, Palamós). As for passengers, he assures that there are all kinds. “From those who go to Barcelona for work or to study, to those who decide to go there for the day, those who have a doctor’s appointment or those who have to go to the airport to catch a plane”, explain.
Those who get into their car pay 11 euros per journey (of which, 2 have the application left). Eva explains that, in the case of those who live in Palafrugell, using Blablacar is a good option because she is not the only one who saves costs; the others, too. “Palafrugell and Barcelona are not well connected”, he says. And specifically: “If you go by bus you can make a journey of three hours and it costs you 18 euros; and if you choose to take the train, you have to go to Girona or some town that has a station, like Flaçà, and you can spend more time being patient because you may encounter delays».
According to Eva, options like Blablacar will boom in the face of the fuel crisis. “I think they will be used more and more”, he says. And as an example, he cites what a passenger told him during the last return trip he made. “He explained to me that, that day alone, there were up to fifteen vehicles covering the journey between Barcelona and the place where he lived, which in this case was Palamós”, he concludes.
In fact, the platform’s data confirms this because during 2022 the use of Blablacar in Catalonia increased by 80% compared to the previous year and by 35% compared to 2019, before the pandemic. In relation to users, they grew by 39% year-on-year, to more than 800,000. The figure is equivalent to almost one in ten Catalans using the application in 2022. Blablacar admits that one of the “most relevant” factors to explain the growth of the last year was the rise in fuel prices.
Second-hand clothing stores
With the goal of saving, one sector that has also seen an increase in sales is that of second-hand clothing stores. The Humana foundation, for example, has found that the consumption of second-hand clothes in Barcelona has grown by 25% in the last year and in 2022 it will exceed one million customers in one financial year for the first time. “These are quality pieces at affordable prices, and in this context of inflation, prices are a major factor in attracting customers,” explains Humana’s spokesperson, Joan Carles Montes, who also points to greater environmental awareness among consumers as a factor to consider. The foundation sells clothes that come from donations and has 22 stores in the Catalan capital.
Regarding the price, Montes explains that they are “indisputably cheaper” than conventional clothing stores. In particular, he points out that a piece bought at Humana costs at least a third of what a new one is worth. For her part, Amanda, a regular consumer of second-hand clothes, admits that the price difference is “quite pronounced”, so that it allows “a lot” of savings. He also welcomes the fact that second-hand clothing stores make it possible to acquire quality pieces in a “more accessible” way.
“Reuse involves saving both energy and economic resources and more and more groups, mainly young people, are opting for second-hand clothes”, says the foundation’s spokesperson. In the same vein, Amanda believes that inflation has favored the consumption of second-hand clothes, but she says that she also notices a “tendency” among young people to wear this type of clothing.
New habits that will stick
After all, one of the questions that is on the table is whether these changes that have arrived astride inflation have come to stay. Both the OCU and Aecoc agree that these new habits in consumption patterns will remain at least during the first half of 2023, as there are still products that have skyrocketed in price compared to last year. In the case of second-hand clothes, Humana assures that it perceives that acquiring used pieces is an “alternative” that is gaining more and more weight in the big fast-fashion chains.
For his part, the professor at the EAE Business School predicts that when inflation passes there will be a “correction” of consumption habits, but he believes that some trends will remain. “Just like what happened with electronic commerce and the pandemic, that there was a slowdown”, compares Alegret. “Whenever we try new things there are generations that get hooked. We just have to see how we consume television, I grew up watching Super3 and my children no longer watch TV,” he says.