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Euro 'Fuelling Price Convergence'
The introduction of the Euro is contributing to a price convergence across Europe for many popular products, according to figures from ACNielsen. Norway is the most expensive country for the products studied, and Germany remains the cheapest, while France and the UK have the smallest range of prices.
The company studied a basket of popular international branded products, and found that the span of prices from cheapest to most expensive country has fallen from 71% in 2002 to 50% today, according to European CEO Frank Martell. 'Among Europe's larger markets, stagnating growth and flat consumer demand combined with an increasing competitive retailing industry are forcing prices down.'
The Euro Price Barometer compares and measures price convergence and divergence trends across Europe, tracking the cost of 160 identical international brand products sold in fifteen European markets - Austria, Belgium, France, Germany, Greece, Italy, Netherlands, Portugal, Spain, Denmark, Great Britain, Norway, Sweden, Finland and Switzerland. Over 25,000 grocery stores and outlets (supermarkets and hypermarkets) are included in the study.
Norway is the most expensive country in Europe to buy international brand products and Denmark is second, reversing their positions from 2003. Germany remains the cheapest, a massive 42.5% cheaper than Norway for these goods.
Sweden is the country with the widest range of price differences (44%, down however from 52% in 2003, partly due to increased retail competition), whereas consumers in the France (12%) and the UK (15%) see the lowest price differences in Europe. In the case of the latter, Nielsen says this has fallen drastically in the last three years (from 37%) due to a combination of retailer consolidation, increase in shopping promotions and intense price wars between major retailers. Martell says that notwithstanding the importance of local factors like taxes, transport and real estate costs, there is an overall trend of price convergence, which may slow in the future but should continue.
ACNielsen is online at www.acnielsen.com.
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