Are equipment investments nearing the home stretch?
Private label trend doesn’t take off in Canada
Consumers to companies: Where’s the green?
In downhill economy, new products fight an uphill battle
SOURCES FOR CURRENT RESIN PRICES


Are equipment investments nearing the home stretch?

A large majority of plastics processors has held off on spending this year, but they won’t hold out much longer, suggests one study.

While financial analysts have described the economic turmoil of late as a perfect storm, a Townsend Solutions-Plastics Technology joint study suggests now is the calm before another storm-an investing storm. Responses from 490 plastics processors indicated that more than 61% have held off spending so far this year, but the same percentage said they’d be ready to pull the trigger on investing as soon as business conditions improved.

Timing the market can be a difficult and risky proposition, but the study suggests processors anticipate business conditions will improve relatively soon. Nearly 18% of processors surveyed said they expect to buy new primary or auxiliary equipment in the next three months, another 33% said they’d be buying within the next four to six months, and 54% said they expect to buy in the next seven to 12 months. The study also showed that 46% of respondents plan on purchasing molds/tooling before the end of 2009, suggesting that new product launches delayed by the current economic crisis may be freeing up in the near future.

Private label trend doesn’t take off in Canada

Canadian brand names hold their own even as U.S. consumers shift to store brands.

Despite the shift to store brands in the U.S., Canadian national brands are still holding their share (81.2%) as they capitalize on consumers’ need for value through increased feature pricing activity, according to Nielsen’s Economic Current report for April. Over the past year, unit sales on feature price increased 8% for national brands, now accounting for 38.5% of unit sales. Canadian private-label sales remained flat, reporting a 1% decline in feature price sales. By comparison, unit sales across store brands in the U.S. increased by 6.4%.

The Nielsen study also found that, like their American neighbors, Canadian consumers have changed their shopping habits to save cash. Over half (55%) of Canadian respondents mentioned they had switched to less expensive brands at the grocery store. Also, Canadian shoppers still shy away from multiple store visits: Those surveyed are making 4% fewer shopping trips. However, those consumers are spending 6% more, an increase that’s driven mostly by rising prices.

Consumers to companies: Where’s the green?

Now convinced of the value of purchasing green products from responsible companies, consumers want to know if products live up to green expectations.

According to a BBMG Conscious Consumer report titled “Redefining Value in a New Economy,” 23% of U.S. consumers say they have “no way of knowing” if a product is green or actually does what it claims. In contrast, 77% of those surveyed agree that they “can make a positive difference by purchasing products from socially or environmentally responsible companies,” and they actively seek information to verify green claims.

To find the necessary information, the report says that consumers have a number of strategies to get to the bottom of green claims. To research and verify green claims, 29% of consumers are most likely to turn to consumer reports, 28% are most likely to look at certification seals or labels on products, and 27% of respondents are most likely to consider the list of ingredients on products. Conversely, 11% of those surveyed were least likely to look to statements on product packaging and only 5% were least likely to believe company advertising.

Numbers from the study support the thinking that green benefits have moved to the top of shoppers’ agendas. Compared to the previous year’s study, the number of respondents that considered energy efficiency “very important” grew to 47%, up six points from 2007 numbers. Likewise, 29% of those surveyed considered a “made from recycled materials” claim very important, an increase of seven percentage points from the year before.

The report also revealed that two-thirds of Americans agree that “even in tough economic times, it is important to purchase products with social and environmental benefits” and 51% say that they are willing to pay more for them. By contrast, 66% of those surveyed said price plays a very important part in their purchase decision.

In downhill economy, new products fight an uphill battle

The large majority of consumers are less likely to try grocery, personal, household and beauty products in a slowing economy.

Consumers around the globe shy away from new consumer goods products when they sense the economy is slowing down says a recent Ipsos Marketing study. The survey found that 59% of global consumers are less likely to try new grocery and personal products, 62% are less likely to try new household products and a stunning 70% of global consumers are less likely to try new beauty products.

The survey found that new products aren’t the only endangered species on store shelves during an economic downturn. Established brands are in danger of low repeat, a fact of retail life supported by the finding that 80% of global consumers are very or somewhat likely to switch from their usual brands to lower-priced brands or brands that are on sale during an economic downturn. Moreover, 72% of consumers say they would switch to store or generic brands.

In its research, Ipsos Marketing wrote that one area on which marketers can (and must) focus is value, a characteristic that quickly gains priority for consumers during an economic downturn. While pricing does not necessarily need to change, consumer perceptions about expensiveness versus benefits-like those expressed through product packaging-should be considered to make sure consumers think the value really is there.

SOURCES FOR CURRENT RESIN PRICES
Chemical Market Associates Inc.
DeWitt & Co. Inc.
ICIS
IDES Inc.
Plastics News