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Q1 Consumer
2019
Market Monitor
UCD Michael Smurfit
Graduate Business School
01 Consumer Market Monitor Q4 2019
Introduction
Consumer
Market Monitor
The Consumer Market Monitor is a publication It is based on data from the Central Statistics
provided by the Marketing Institute of Ireland Office (CSO), the Central Bank, the European
in collaboration with the UCD Michael Smurfit Commission, and other secondary sources. The
Graduate Business School. added value rests in the fact that the information
is brought together in a single location and
It is designed to track key indicators of confidence presented in a way that is easy to use for market
and activity in the Irish consumer market as a analysis and sales planning. The accompanying
resource for marketers and the wider business editorial also highlights important trends and
community. The consumer market accounts for linkages that point to emerging opportunities
over 50% of GNP so it is an important indicator and threats.
of the health of the economy.
It is published on the Marketing Institute website
It relies on a model of consumer behaviour which and the UCD Smurfit School website and is
sees economic variables such as income levels, updated every quarter. This edition covers Q4
taxes, interest rates and exchange rates influencing of 2019 and reviews the year as a whole.
consumer confidence which, in turn, influences
consumer behaviour including spending, saving
and borrowing.
The Author
Mary Lambkin is a Fellow of the
Contents
Marketing Institute of Ireland, and one of
Ireland’s leading marketing academics. 01 Consumer Market Monitor
As Professor of Marketing at University
College Dublin, she teaches courses to 02 Executive Summary Income Consumer Behaviour Model
undergraduate and postgraduate students Savings
and is involved in a range of research 12 Consumer Confidence
projects under the general heading of
marketing strategy. 14 Consumer Incomes & Spending
Mary has written extensively on this 16 Personal Spending On Goods/Services
subject in academic journals, and also
Taxes
writes commentaries on marketing topics 18 Personal Borrowing
of contemporary interest for professional
publications. 19 Residential Property Sales
Spending
She has served as Head of the Marketing Consumer
22 Service Index Confidence
Group, as Dean of the UCD Business
School and as a member of the Governing
Authority of the university at various times,
25 Sales of Private Cars
Interest Rates
and also holds a number of positions in
companies and professional organisations 28 Retail Sales Index
outside the university.
The Author
Borrowing
Exchange Rates
Mary Lambkin
02 Consumer Market Monitor Q4 2019 03 Consumer Market Monitor Q4 2019
Introduction Introduction
Executive Summary
The Irish economy is continuing to grow strongly, encourage consumers to release some of that
with consumer spending providing the main wealth for spending.
stimulus together with property investment.
Personal spending grew by 3.4% in 2018 and Irish consumers are also beginning to supplement
by 3.3% in 2019, a strong performance that their incomes by taking on some debt, mainly
exceeded estimates. to support the purchase and furnishing of
homes. Following a decade of deleveraging
Consumer demand is expected to remain strong with repayments exceeding new borrowing
this year and next driven by continuing growth every year, borrowing is beginning to increase
in employment and incomes, but also helped by again at a modest rate. New lending of €2 billion
the removal of uncertainty in relation to Brexit. was advanced to Irish households in 2019, an
increase of 2%. €1.2 billion of this was for the
There are now 2.33 million people at work, up purchase of residential property with the balance
54,000 (2.4%) year-on-year, and up by 500,000 for other personal consumption.
(28%) from the low point in 2012. Employment
is expected to continue growing this year but at Credit and borrowing are not major contributors
a moderating rate as the economy approaches to recent spending, however, unlike in the last
full employment. Forecast growth of 1.5% in boom. The ratio of debt/disposable income of
4%
2020 and 2021 will add another 70,000 people Irish households has continued to fall, down from
to the workforce. 215% at the peak in 2012 to 115% in September
2019, a reduction of almost 50%. Also, savings
Earnings growth has also played a part in recent are continuing to increase – bank deposits grew
years as wages have begun to rise. Wages by almost €6 billion (+5.5%) in 2019.
increased by 2.5% per annum from 2015 to
2017, by 3.5% in 2018 and 2019, and are An estimated 57,000 homes were sold in 2019
forecast to rise 4% this year and next, as the which was 4% higher than 2018. In contrast, the
labour market tightens. number of mortgages approved was up 7% in
the year indicating that demand is still stronger
The combination of more people at work and than supply. 65% of those mortgages went to
higher wages has led to substantial increases first time buyers showing that this is still the
in the amount of disposable income circulating predominant need.
in the economy. Aggregate disposable income
increased by 5% a year from 2015 to 2017, The market for cars is the most troubled sector wth has
Earnings gro
by 6% in 2018 and 2019 amounting to €117 right now; sales of new cars were down by -6.5% part in
also played a
billion for the year. This momentum is continuing in 2019 to a total of 113,305. This continues the as wages
recent years
in 2020 although forecasters suggest some negative trend of the previous two years, with to rise.
have begun
ased by
Wages incre
moderation as employment growth slows. sales down -10.5% in 2017 and -4.6% in 2018.
num from
Growth of even 3% would lead to aggregate
2.5% per an
7, by 3.5%
disposable income of €120 billion for this year. In contrast, the number of imported used cars 2015 to 201
2019, and
has been increasing every year since 2005, with in 2018 and
to rise 4%
Consumer spending has also been boosted sales of 109,000 in 2019, almost equalling new are forecast
next, as the
by improving household finances, mainly as car sales. this year and
t tightens.
a result of the increasing value of peoples’ labour marke
homes. Household wealth stood at €800 billion In sum, car registrations have been more or less
in September 2019, equivalent to €470,000 per static for the past three years at about 220,000
household or €163,000 per person. This is up per annum (222,000 in 2019). This compares to a
80% from the lowest point in 2012. Perceptions total of 240,000 in 2007, of which 180,745 (75%)
of increasing wealth build confidence and were new cars.
04 05 Consumer Market Monitor Q4 2019
Introduction
A final point to note is the broad-based as a whole and the momentum is continuing this
deterioration in the UK consumer economy on year, although perhaps at a slowing rate.
foot of Brexit. There has been a weakening in
virtually every metric tracked in this monitor, from There are now 2.33 million people at work, up
property to cars to retail and services from mid- 55,000 (2.4%) year-on-year, and up by 500,000
2016 to the end of 2019. Recent data show that or 28% from the low in 2012. Growth is expected
this negative trend may be easing, however, with to continue this year and next, but at a slightly
more clarity around Brexit and a slight lift in the lower rate of 1.7% and 1.5%, but this will add
value of Sterling. another 70,000 people to the workforce.
Consumer Confidence Earnings growth has also played a significant role
Consumer confidence began to recover in 2013 in recent years; wages increased by about 2.5%
and increased steadily for five years in response per annum from 2015 to 2017, and by 3.5% in
to positive economic data. By 2017, confidence 2018 and 2019. Average weekly earnings stood at
among Irish consumers was well ahead of the €768 last year, equivalent to annual pay of €40,000.
previous peak in 2007 and was also significantly
higher than that of our European neighbours. Household wealth has also recovered well from
the recession, standing at €800 billion in 2019,
Confidence dropped through 2018 reflecting €470,000 per household or €163,000 per person.
-6
continuing worries about the negative implications This is up by 80% from the trough of €430 billion
of a “hard Brexit”. This downward trend continued in Q2 2012.
through 2019 and, by the end of the year,
confidence here was only marginally higher than Household spending grew by 3.4% in 2018 to
the UK and the wider EU. Confidence has picked €105 billion, and this positive trend continued in
up in January 2020, however, and the picture 2019 with spending up by 3.3% to a total of €108
looks more promising for the rest of this year. billion. Household spending is forecast to grow
by a slightly lower rate this year, of 2.7%, to about
Consumer confidence in the UK has been €111 billion, and by a further 2.4% in 2021.
consistently negative since Q2 2016, reaching
a low of -14 in November 2019. It picked up Consumer Borrowing
slightly in December (-11), however, and again Borrowing by Irish households grew at a record
in January 2020 (-9), suggesting that the tide level from 2000 onwards and peaked in 2008 at
op
ce dr ies
may be turning now that Brexit has actually €150 billion. It then declined steadily - down 40%
de n rr
nfi happened. by December 2016 to €88 billion. This downward
8 s aw co inuing wo
201 ing con ”. Thist trend levelled off in 2017, after almost a decade,
t it d
reflec ard Brex continue Consumer confidence in the EU has also been the first sign of a return to normal conditions.
h d
of a “ ward tren d, by the e relatively weak for several years although slightly Household debt increased by 2% per annum
n c
down h 2019 a confiden stronger than the UK (-8). in the last two years and stood at €92 billion in
g r,
throu f the yea arginally e December 2019.
h
end o as only mUK and t Consumer Incomes and Spending
w e as
here than th dence h , The disposable income of Irish households rose by Loans for house purchase, which account for 83%
r fi 0
highe EU. Con uary 202 6% in 2018 to a total of €110 billion, significantly of all household loans, peaked in 2008 at €125
r n
wide up in Ja e picture overtaking the last peak of €101 million in 2007. billion but reduced to a low of €73 Billion by 2016,
e d th r
pick er, and ising fo Increasing numbers in employment together with a cumulative decline of 40%. Mortgage lending
v m
howe more pro ear. pay increases drove this growth. has resumed growth since then, increasing by
y
looks st of this over €1 billion in 2018 (+1.4%) and by €1.5 billion
e
the r Disposable income grew by a further 6% in 2019 in 2019 (1.6%).
reaching an estimated €117 billion for the year
2.33 million
06 Consumer Market Monitor Q4 2019 07
Introduction
Lending for other consumption accounts for 17% showing modest growth from 2011 onwards,
people
at work
of total borrowing. This category peaked in 2008 and recovering more rapidly in recent years. The
at €30 billion but declined to €13 billion by mid- index overtook the 2007 peak in 2014, and made
2016, a reduction of 60%. It resumed growth in further gains in 2015, 2016, and 2017, up by
2017 amounting to €15 billion by December 2019. 4+% per annum.
The indebtedness of Irish households is continuing Services growth accelerated in 2018, up 8%, and
to reduce; the ratio of debt/disposable income of this strength continued through 2019 which was
Irish households has fallen from 215% in 2012 to up by 7% year-on-year, although it tapered off as
115% in September 2019, a reduction of almost the year unfolded (from 10.8% to 2%). This was
50%. Household deposits also have continued to closely matched by Vat returns which were up
grow, up by €6 billion or 5.5% in 2019. 7% in 2018 and by a further 6.2% in 2019 to a
total of €15 billion.
Residential Property There are now 2.
33 million
There were 57,000 homes sold to private The fortunes of individual service sectors people at work, up
54,000
households in 2019, an increase of 4% on the have varied widely, however, Information/ (2.4%) year-on-ye
ar, and
55,000 sold in 2018 which, in turn, was up communication services did best, up by an up by 500,000 (2
8%) from
6% on the 52,000 sold in 2017. This seems a astonishing 28% in 2019. Other services were up the low point in 20
12.
modest rate of growth with such a high level of by 12%, and accommodation and food service Employment is ex
pected to
demand for living accommodation. were also strong, up 3% and 9% respectively in continue growing
this year
2019. but at a moderat
ing rate as
There were 32,835 mortgages drawn down in the economy appr
oaches
2019 which was 7% higher than the 30,630 in Car Sales full employment.
Forecast
the previous year. 65% of those mortgages went Following the recession, sales of new cars began growth of 1.5% in
2020
to first time buyers demonstrating that this is still to recover in 2014, and grew substantially in and 2021 will add
another
the predominant need. 2015 and 2016, to 143,000 units. This positive 70,000 people to
the
trend was short lived, however, reversing steadily workforce.
New homes are playing an increasing part in since then.
fulfilling that need -10,300 were sold in 2018
compared to 8,800 in 2017. 20,000 new homes Sales of new cars were down by -6.5% in 2019
were completed in 2019 and housing starts to a total of 113,305. This continues the negative
rose to 26,000 suggesting a higher completion trend of the previous three years, with sales down
rate in 2020. -10.5% in 2017, by -4.6% in 2018.
There were 1.24 million residential properties In contrast, there has been a substantial increase
sold in the UK in in 2016 but the market slowed in the number of imported used cars every year
to 1.2 million in 2017 and 2018. 2019 was since 2005, with sales of 109,000 in 2019 almost
weaker again, at 1.19 million but the market is equalling new car sales.
expected to strengthen this year to about 1.21
million units. In sum, car registrations have been more or less
static for the past three years at about 220,000
Services per annum (222,000 in 2019). This compares to
The services sector recovered more quickly a total of 240,000 in 2007 of which 180,745 were
from the recession than the retail sector, new cars.
08 09 Consumer Market Monitor Q4 2019
Introduction
Retail Spending
Retail sales (excluding the motor trade) were
strong in 2019, up by 4.3% in volume and
2.7% in value. This continued the positive
trend from 2018 when sales were up by
3.7% in volume and 2.7% in value but was
lower than 2017 (+5.8% in volume and
+3.5% in value). Sales revenue for 2019
amounted to €47 billion which was back to Department stores
the levels last seen in 2007. Bar sales up 4.0% down -2.7% in
in volume and 2.6% volume but down
Online sales represented just 3.3% of total Fuel down -0.4% in value -5.5% in value
sales for traditional (bricks and mortar)
retailers operating in Ireland, although it was and in volume
higher in some categories such as books and down by
(13.5%). This does not include online retail -1.8% in value
sales going to exclusively digital retailers (eg
Amazon) which amounted to about 11% of
total retail sales.
Household equipment continued to be Household equipment
the fastest growing category this year, up up 10.8% in volume
by 11% in volume and 4% in value in Q4, and 3.2% in value
year-on-year. Sub-categories within that
- electrical goods and furnishings - did
exceptionally well, up by 12% and 7%
respectively.
Supermarkets and other food stores also Non-specialised
performed well, as did pharmaceuticals stores (supermarkets)
and cosmetics. Department stores and up 3.6% in volume
newsagents were the weakest categories and 3.0% in value
in Q4, down by -2.7% and -4.5% in volume Books, newspapers
respectively.
and stationery up
0.1% in volume and Food sales up 3.6%
1.9% in value in volume and up
2.9% in value;
Re
ta Pharmaceuticals and
in 2 il sale
vol 0 s
um 19, u were cosmetics up 3.9%
Sal e an p by stro Motor trades up
in volume and 1.6%
am es rev d 2.7 4.3% ng 5.7% in volume and
o % in value
wh unted enue in va in 7.1% in value
ich for 2 lue
w to . Clothing, footwear
leve as b €47 b 019
ls la ack illio
and textiles up 4.4%
in 2 st se to th n
007 en e in volume and 1.9%
.
in value
11 Consumer Market Monitor Q4 2019
Analysis
Consumer & Retail
Analysis
12 Consumer Market Monitor Q4 2019 13 Consumer Market Monitor Q4 2019
Consumer Analysis Consumer Analysis
Consumer Confidence Consumer Confidence
Annual Quarterly
Consumer Confidence January 2008 - December 2019 Consumer Confidence Quarter 1 2013 - Quarter 4 2019
Europe United Kingdom Ireland Europe United Kingdom Ireland
40.00
20.00
30.00
10.00
20.00
0.00 10.00
-10.00 0.00
-10.00
-20.00
-20.00
-30.00
-30.00
-40.00 -40.00
-50.00
2013 Q1
Q2
Q3
Q4
2014 Q1
Q2
Q3
Q4
2015 Q1
Q2
Q3
Q4
2016 Q1
Q2
Q3
Q4
2017 Q1
Q2
Q3
Q4
2018 Q1
Q2
Q3
Q4
2019 Q1
Q2
Q3
Q4
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Consumer confidence in Ireland fell dramatically Consumer confidence in the UK has been Consumer confidence in Ireland fell slightly in Consumer confidence in the UK has been
in 2009 as the financial crisis unfolded, and negative since Q2 2016, reaching a low of -14 2016, reflecting uncertainty about Brexit, but negative since Q2 2016, reaching a new low of
remained low from 2009 to 2012. Confidence in November 2019. Consumer confidence in picked up again in 2017 in response to strong -14 in November 2019. It has recovered slightly
picked up in 2013 and rose further through 2014 the EU has also been relatively weak but a few employment data, reaching a significantly higher in January 2020, however, as Brexit finally
and 2015 due to a steady flow of good news on points stronger than the UK. level than neighbouring countries. happened, reducing the uncertainty faced by
employment.01 At this point, we were well ahead British consumers.
of the last peak in 2007 and of our European In contrast, confidence has been very high in Confidence dropped through 2018 reflecting
neighbours. the US, ending the year 2019 at an historically continuing worries about a “hard Brexit” and Consumer confidence in the EU has also been
high level of 132, fuelled by good news on negative implications for the economy. This muted for several years, consistently in negative
Confidence fell slightly through 2016 reflecting employment and the stock market.02 downward trend continued through 2019 and, territory, although slightly better than the UK.
uncertainly about Brexit, but it steadied again by the end of the year, confidence here was only
in 2017 and finished the year well above our marginally higher than the UK and the wider In contrast, American consumer confidence has
neighbours. This positivity eroded slightly in EU. Confidence has picked up in January 2020, been very strong, reached 132 in November
2018, and fell significantly through 2019 as however, now that Brexit has happened, and 2019, the highest level in 18 years.
anxiety about Brexit reached its zenith. the picture looks more promising for the rest of
this year.
01. www.independent.ie/business/irish/irish-consumer-sentiment-nears-eightyear-high-in-december-30892291.html
02. https://markets.businessinsider.com/news/stocks/us-consumer-confidence-beats-forecasts-at-highest-level-since-august-2020-1-1028851474
14 Consumer Market Monitor Q4 2019 15 Consumer Market Monitor Q4 2019
Consumer Analysis Consumer Analysis
Consumer Incomes and Spending
Annual
Disposable Incomes and Household Spending
€Billions - Current Disposable Income Household Spending
120,000
100,000
80,000
111bn
60,000
40,000
20,000
Billion €0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Disposable income in Ireland increased by 60% Net worth per capita stood at €163,000 in Q2
from 2002 to 2008 -from €65bn to €104bn, due 2019, or €470,000 per household.05 Household Personal consum
to growing employment and rising incomes.03 deposits have also been increasing, to €6 billion er
spending grew by
This trend reversed in 2009 and fell steadily until (+5.5%) in 2019, the largest increase since 2008.06 3.4%
in 2018 to €105 bi
2012, down -15% (-7.5% in real terms), as a llion,
and this positive
result of the recession.04 Household spending closely mirrors income, trend
continued in 2019
and increased by 48% from 2002 to 2008, from with
spending up by 3%
Conditions stabilised in 2013 and disposable €62bn to €95bn.07 Spending then declined to a to
a total of €108 bi
income rose by 3% in 2014. It continued to rise in low of €84 billion in 2011, down -15% (-7.5% llion.
Consumer spendi
2015, 2016 and 2017, by about 5% per annum. in real terms). ng is
forecast to grow
Growth accelerated in 2018 with income up by by a
slightly lower rate
6% to €110 billion, and up again by 6% in 2019 Household spending began to recover in 2014 this
year, of 2.7%, to
to around €117 billion. and was up by 3-4% per year in 2016 and 2017. about
€111 billion, and
Spending rose 5% in 2018, to €99 billion, and by a
further 2.4% in 20
Household wealth has also recovered, to €800 that momentum continued in 2019 with spending 21.
billion in January 2020, up 85% from 2012. up by a further 6% to €104 billion.08
03. CSO Institutional Sector Accounts, Q2, 2019
04. http://danmclaughlin.ie/blog/record-rise-in-irish-household-real-incomes-in-2015/
05. https://www.centralbank.ie/statistics/data-and-analysis/financial-accounts
06. https://www.centralbank.ie/docs/default-source/statistics/data-and-analysis/financial-accounts/quarterly-financial-accounts-for-ireland-q2-2019.pdf?sfvrsn=2
07. Household spending accounts for 92% of all personal spending
08. CSO Institutional Sector Accounts, Q3, 2019
16 Consumer Market Monitor Q4 2019 17 Consumer Market Monitor Q4 2019
Consumer Analysis Consumer Analysis
Personal Spending on Goods/Services Personal Spending on Goods/Services
Annual Quarterly
Personal Spending on Goods/Services 2009 - 2019 Personal Spending on Goods/Services Quarter 1 2013 - Quarter 4 2019
€ Millions € Millions
120,000 30,000
110,000 25,000
112,000
107,000
100,000
20,000
99,865
98,613
90,000
92,377
15,000
90,928
90,136
90,985
89,445
88,783
88,898
80,000
10,000
70,000
5,000
60,000
0
50,000
2013 Q1
Q2
Q3
Q4
2014 Q1
Q2
Q3
Q4
2015 Q1
Q2
Q3
Q4
2016 Q1
Q2
Q3
Q4
2017 Q1
Q2
Q3
Q4
2018 Q1
Q2
Q3
Q4
2019 Q1
Q2
Q3
Q4
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Personal spending rose rapidly from 2000 to by 3.3% for the full year 2019 to a total of €112 Personal spending peaks in the fourth quarter Consumer spending is estimated to have grown
2007, by 6% per year. Spending declined over billion. Growth is forecast to slow this year and each year, in the run up to Christmas. This peak 3.3% for the full year 2019 to a total of €112
the next five years, down -7% in real terms from next as Brexit unfolds, to 2.7% in 2020 and 2.4% reached an all-time high in Q4 of 2007 but billion. Growth is expected to slow this year
2007 to 2013.09 in 2021.11 declined for six years after that. as Brexit unfolds, to 2.7% this year and 2.4%
in 2021.
Personal spending grew by 2% in 2014, by 4.5% Consumer spending in the UK fell -4% from the Consumer spending turned a corner in 2014,
in 2015, and by 3.8% in 2016.10 Spending was 2007 peak to the trough in 2011, from £955 when it grew by 2%, and it grew by +4% in 2015 Personal spending in the UK has been weak since
softer in 2017, up by 2.8%, but picked up again to £916 billion. Spending rallied between 2012 and 2016.13 The pre-Christmas peak in 2016 2016, down from 1.9% in 2017, to 1.8% in 2018
in 2018. and 2016, up 2-3% per year. However, it slowed surpassed the previous peak of 2007. Growth and to 1.6% in 2019.14 Consumer spending in the
following the Brexit vote to 1.6% in 2017, 1.8% continued in 2017 but at a slightly lower rate, EU increased by 1.5% in 2018 and by the same
Personal consumer spending grew by 3.4% in 2018 and 1.1% in 2019.12 up by 2.8% to almost €104 billion. rate this year, following growth of around 2% for
in 2018 to €107 billion, and this positive trend several previous years.15
continued in 2019 with spending up by 3.4 % US consumer spending has been growing Personal consumer spending grew by 3.4%
in the year to September in constant terms. The steadily for a number of years, up by an annual in 2018 to €107 billion, and this positive trend US consumer spending grew by 3.5% in 2018
fourth quarter was also strong so it is estimated rate of around 3.5%. continued in 2019 with spending up by 3.4% supported by a robust labour market, and this
that personal consumer spending has grown to the end of September in constant terms. rate of growth is continuing in 2019.16
09. http://www.ibec.ie/IBEC/Press/PressPublicationsdoclib3.nsf/vPages/Newsroom~irish-
economy-in-new-post-recovery-phase-08-01-2018/$file/Ibec+Economic+Outlook+Q4+2018.pdf 13. Central Bank of Ireland, Quarterly Economic Bulletin, Quarter 1, 2017
10. Central Bank of Ireland, Quarterly Economic Bulletin, Quarter 4, 2018. 14. https://uk.reuters.com/article/uk-britain-consumers/uk-consumer-spending-growth-in-2019-to-be-slowest-in-six-years-ey-item-club-idUKKCN1TO0ZW
11. https://www.centralbank.ie/docs/default-source/publications/quarterly-bulletins/qb-archive/2019/quarterly-bulletin-q4-2019.pdf#page=12 15. https://ec.europa.eu/eurostat/documents/2995521/10059905/2-06092019-AP-EN.pdf/cc94624f-af21-4849-bcb0-b144ad7f9597
12. https://www.ons.gov.uk/economy/nationalaccounts/satelliteaccounts/bulletins/consumertrends/julytoseptember2019 16. https://www.cnbc.com/2019/10/31/consumer-income-and-spending-rise-slightly-in-september.html18 Consumer Market Monitor Q4 2019 19 Consumer Market Monitor Q4 2019
Consumer Analysis Consumer Analysis
Personal Borrowing Residential Property Sales
Quarterly Annual
Personal Borrowing Quarter 1 2013 - Quarter 4 2019 Number of Homes Sold 2009 - 2019
Total Credit House Mortgage Finance Other Personal Loans and Consumer Credit Number of Transactions
160,000
90,000
140,000 80,000
120,000 70,000
100,000 60,000
57,000
50,000
55,000
52,000
80,000
48,350
48,250
40,000
42,000
60,000
30,000
32,378
30,000
40,000
27,600
26,000
20,000
25,400
20,000
10,000
0 0
2013 Q1
Q2
Q3
Q4
2014 Q1
Q2
Q3
Q4
2015 Q1
Q2
Q3
Q4
2016 Q1
Q2
Q3
Q4
2017 Q1
Q2
Q3
Q4
2018 Q1
Q2
Q3
Q4
2019 Q1
Q2
Q3
Q4
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
2009 was the worst year of the recession in terms Sales of residential properties in the UK have
Borrowing by Irish households grew at a record increasing by over €1 billion in 2018 (+1.4%) and of residential property sales, with just 25,4000 been depressed by Brexit worries, down -1%
level from 2000 and peaked in mid-2008 at €150 by €1.5 billion in 2019 (1.6%). homes sold. The number of mortgages issued in 2017, -2.8% in 2018, and by a further 1% in
billion. It then declined steadily- down 40% to also fell to a low of 9,700 in 2011, having peaked 2019, from 1.24 million transactions in 2016 to
€88 billion by December 2016. Lending for other consumption accounts for 17% at 85,000 in 2005.19 1.19 million in 2019.21
of total borrowing. This category peaked in 2008
The downward trend finally reversed in 2017 with at €30 billion but declined to €13 billion by mid- 2014 was the first year to see a significant lift in The number of home sales has been more or
debt increasing by 2%, the first sign of a return to 2016, a reduction of 60%. It resumed growth in the market, with 42,000 homes sold and 19,125 less flat for the last five years at around 6 million
normal conditions.17 Household debt increased 2017 amounting to €15 billion by December 2019. new mortgages issued, an increase of 50%. This per annum, about 10% of which are new builds.22
by 2% per annum in the last two years and stood upward trend continued in 2015, with 48,250
at €92 billion in December 2019. The indebtedness of Irish households is sales and 22,767 new mortgages issued, up 19%.
continuing to reduce; the ratio of debt/disposable
Loans for house purchase, which account for income of Irish households has fallen from 215% Sales were flat in 2016, at 48,350, while there
83% of all household loans, peaked in 2008 at in 2012 to 115% in 2019, a reduction of 40%. were 23,589 mortgages issued. Sales grew to
€125 billion but reduced to a low of €73 Billion Household deposits also have continued to grow, 52,000 (+8%) in 2017, and were up by 5% in
by 2016, a cumulative decline of 40%. Mortgage up by €6 billion or 5.5% in 2019.18 2018 to 55,000 units, and by a further 4% in
lending has resumed growth since then, 2019 to an estimated 57,000.20
19. Data are not available for sales of residential properties prior to 2010, so we used the number of mortgages issued for house purchase as a proxy, adjusted
for cash sales. New loans for purchase of private homes. Excludes top-ups and buy-to-let
20. https://media.myhome.ie/content/propertyreport/2018/Q42018/MyHomePropertyReportQ4-2018.pdf
17. http://www.rte.ie/news/business/2016/0818/810205-household-debt/ 21. https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/674611/UK_Tables_Jan_2018__cir_.pdf
18. https://www.centralbank.ie/news/article/quarterly-financial-accounts-q3-2019 22. https://www.statista.com/statistics/275156/total-home-sales-in-the-united-states-from-2009/20 Consumer Market Monitor Q4 2019 21 Consumer Market Monitor Q4 2019
Consumer Analysis Consumer Analysis
Residential Property Sales
Quarterly
Number of Homes Sold Quarter 1 2012 - Quarter 4 2019
Number of Homes Sold
18,000
16,000
14,000
12,000
+4%
10,000
8,000
6,000
4,000
2,000
0
2012 Q1
Q2
Q3
Q4
2013 Q1
Q2
Q3
Q4
2014 Q1
Q2
Q3
Q4
2015 Q1
Q2
Q3
Q4
2016 Q1
Q2
Q3
Q4
2017 Q1
Q2
Q3
Q4
2018 Q1
Q2
Q3
Q4
2019 Q1
Q2
Q3
Q4
There were 48,350 sales of private residential New homes are playing a part in fulfilling that
properties in 2016, down 4% on 2015, partly need - new homes accounted for about 11,000 There were 57
because of a shortage of supply; just 19,400 sales in 2019 which means about half of the ,000 homes
sold to private
homes or 1% of the national housing stock was 20,000 units completed were actually sold. This households
in 2019, an in
for sale in Q4 2016. compared to 10,300 new homes sold in 2018
crease
of 4% on the
and 8,800 in 2017. Housing starts rose to 26,000
55,000
sold in 2018 w
There were 57,000 homes sold to private in 2019 suggesting a higher completion rate in hich, in
turn, was up 6
households in 2019, an increase of 4% on the 2020, but buyers have to be able to raise the % on the
52,000 sold in
55,000 sold in 2018 which, in turn, was up funds to purchase them.23 2017. This
seems a mod
6% on the 52,000 sold in 2017. This seems a
est rate of
growth with s
modest rate of growth under conditions of high There were 1.24 million residential properties
uch a high
level of deman
demand in the market. sold in the UK in in 2016 but the market slowed
d for living
accommodati
to 1.2 million in 2017 and 2018. 2019 was
on.
There were 32,835 mortgages drawn down in weaker again, at 1.19 million, but the market is
2019 which was 7% higher than the 30,630 in expected to strengthen this year to about 1.21
the previous year. 65% of those mortgages went million units.24
to first time buyers demonstrating that this is still
the predominant need.
23. https://media.myhome.ie/content/propertyreport/2019/q42019/MyHomePropertyReportQ4-2019.pdf
24. https://www.ons.gov.uk/peoplepopulationandcommunity/housing22 Consumer Market Monitor Q4 2019 23 Consumer Market Monitor Q4 2019
Consumer Analysis Consumer Analysis
Services Index Services Index
Annual Quarterly
Services Index 2009 - 2019 Services Index Quarter 1 2013 - Quarter 4 2019
Services Index Services Index
180 180.0
160 160.0
140 140.0
137.6
120 120.0
127.4
125.5
124.6
118.1
100 100.0
111.7
107.3
106
102.4
99.9
103.3
80 80.0
60 60.0
40 40.0
20 20.0
0 0.0
2013 Q1
Q2
Q3
Q4
2014 Q1
Q2
Q3
Q4
2015 Q1
Q2
Q3
Q4
2016 Q1
Q2
Q3
Q4
2017 Q1
Q2
Q3
Q4
2018 Q1
Q2
Q3
Q4
2019 Q1
Q2
Q3
Q4
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
The services sector accounts for about 40% of up by 7% year-on-year, although it tapered off as The services sector has a marked seasonal The fortunes of individual service sectors
all personal consumer spending, with retailing the year unfolded (from 10.8% to 2%). This was trend, with the highest sales occurring in have varied widely, however, Information/
accounting for another 40%, and housing closely matched by Vat returns which were up Q4 each year, reflecting the spending pre- communication services did best, up by
the remainder. The services sector includes 7% in 2018 and by a further 6.2% in 2019 to a Christmas and New Year. an astonishing 28% in 2019. Other services
accommodation and food service, professional total of €15 billion. were up by 12%, and accommodation and
and technical services, information and The service index grew through 2014, 2015, food service were also strong, up 3% and
communication, wholesaling and transportation. The fortunes of individual service sectors have 2016 and 2017 by 4% per annum on average. 9% respectively in 2019.
varied widely, however, Information/communication
The services sector recovered more quickly services did best, up by an astonishing 28% Services growth accelerated in 2018, up 8%, The UK Services Index grew steadily from
from the recent recession than the retail sector, in 2019. Other services were up by 12%, and and this strength continued through 2019 which 2009, up by around 3% per year. This levelled
showing modest growth from 2011 onwards, and accommodation and food service were also was up by 7% year-on-year. This was closely off in 2017, to 1.3%, and that weaker trend
recovering more rapidly in recent years. The index strong, up 3% and 9% respectively in 2019. matched by Vat returns which were up 7% in continued through 2018, with growth at a
overtook the 2007 peak in 2014 and made further 2018 and by a further 6.2% in 2019 for a total record low of 1.2% in 2019.26
gains since then with growth averaging 4% per The UK Services Index grew steadily from 2009, of €15 billion.
annum for the three years to 2017. up by around 3% per year. This levelled off in
2017, to 1.3%, and that weaker trend continued
Services growth accelerated in 2018, up 8%, and through 2018, with growth at a record low of
this strength continued through 2019 which was 1.2% in 2019.25
25. https://www.ons.gov.uk/economy/economicoutputandproductivity/output/bulletins/indexofservices/november2019 26. https://www.ons.gov.uk/economy/economicoutputandproductivity/output/bulletins/indexofservices/november201924 Consumer Market Monitor Q4 2019 25 Consumer Market Monitor Q4 2019
Consumer Analysis Consumer Analysis
Sales of Private Cars
Annual
Sales of Private Cars 2009 - 2019
New Private Cars Imported Secondhand cars Total
300,000
250,000
200,000
-6.5%
150,000
100,000
50,000
0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
New car sales peaked in 2007 with 180,754 sold. 2017 and 2018 at about 220,000, with 2019 at
Sales of new cars Sales dropped dramatically since then, with the 222,000.
were
down by -6.5% in lowest point in 2009 when just 54,432 new cars
2019
to a total of 113,30 were sold. Sales remained sluggish from 2010 to In addition, private sales of used cars amounted
5.
This continues th 2013, averaging 75,000 per year. to 350,000 in 2013, 425,000 in 2014 (+ 22%),
e
negative trend of 450,000 in 2015 (+6%), and 475,000 in 2016
the
previous three ye The market picked up in 2014 with 92,361 new (+6%) which was a peak. Private sales of used
ars,
with sales down cars sold (+30%) and in 2015 to 121,110 (+31%). cars have declined steadily since then to 430,000
-10.5%
in 2017, by -4.6% 142,688 new cars were sold in 2016, a smaller in 2018.27
in
2018. increase of 18%.
Sales of new cars in the UK reached a 12-year
Sales of new cars fell by -10.5% in 2017, to high in 2016, at 2.7 million, but sales fell in 2017
127,045, and dropped by a further -4.6% in 2018 to 2.54 million (-5.4%), to 2.37 million in 2018
to 121,157. This was due to a major increase (-6.8%), and to 2.3 million in 2019 (-2.4%).28
in imports of used cars, totalling 99,456 in Sales to private buyers were even weaker at
2018, double that of 2015. Taking new cars and 1.05 million (-3.2%).29
imported used cars together, sales were flat in
27. https://www.cartell.ie/2019/08/used-car-sales-down-4-2/
28. https://www.carmagazine.co.uk/car-news/industry-news/uk-2017-car-sales-analysis-winners-and-losers/
29. https://www.best-selling-cars.com/britain-uk/2019-full-year-britain-new-car-market-overview-and-analysis/26 Consumer Market Monitor Q4 2019 27 Consumer Market Monitor Q4 2019
Consumer Analysis Consumer Analysis
Sales of Private Cars
Quarterly
Sales of Private Cars Quarter 1 2013 - Quarter 4 2019
New Private Cars Secondhand Private Cars Total
120,000
110,000
100,000
90,000
80,000
70,000
60,000
50,000
222,000
40,000
30,000
20,000
10,000
0
2013 Q1
Q2
Q3
Q4
2014 Q1
Q2
Q3
Q4
2015 Q1
Q2
Q3
Q4
2016 Q1
Q2
Q3
Q4
2017 Q1
Q2
Q3
Q4
2018 Q1
Q2
Q3
Q4
2019 Q1
Q2
Q3
Q4
Sales of new cars have traditionally been In sum, car registrations have been more or less
concentrated in January and February. 65% static for the past three years at about 220,000
of sales are still occurring in the first half of per annum (222,000 in 2019). This compares
the year under the dual registration system.30 to a total of 240,000 in 2007 of which 180,745
were new cars.
New car sales began to recover in 2014, and In sum, car regist
grew strongly in 2015 and 2016, to a total of Sales of other used cars (excluding imports) are rations
have been more or
142,688. This trend reversed in 2017, with also down in recent years, suggesting a general less
static for the past
new car sales down -10.5% to 127,045. Sales weakness in the motor trade. Approximately, three
years at about 22
weakened further in 2018, down -4.6% to 410,000 cars changed hands privately in 2019 0,000
per annum (222,0
121,157. and this was 4% down on 2018. 00 in
2019). This compa
res to
a total of 240,000
Sales of new cars were down further in 2019 to Sales of new cars in the UK reached a 12-year in 2007
of which 180,745
a total of 113,305 (-6.5%). In contrast, there has high in 2016, at 2.7 million, but sales fell in 2017 were
new cars.
been a substantial increase in the number of to 2.54 million (-5.4%), to 2.37 million in 2018
imported used cars every year since 2005, with (-6.8%), and to 2.3 million in 2019 (-2.4%).31
sales of 109,000 in 2019 almost equalling new Sales to private buyers were even weaker at
car sales. 1.05 million (-3.2%).32
30. http://www.rte.ie/news/2015/0811/720529-new-cars-licensed-in-july-up-over-50-on-last-year/
31. https://www.carmagazine.co.uk/car-news/industry-news/uk-2017-car-sales-analysis-winners-and-losers/
32. https://www.best-selling-cars.com/britain-uk/2019-full-year-britain-new-car-market-overview-and-analysis/28 Consumer Market Monitor Q4 2019 29 Consumer Market Monitor Q4 2019
Consumer Analysis Consumer Analysis
Retail Sales Retail Sales
Annual Quarterly
Retail Sales Index 2009 - 2019 Retail Sales Index Quarter 1 2013 - Quarter 4 2019
Base 2005 = 100 Value Volume Series 1 Series 2
130 160.0
132.3
150.0
125
120
140.0
120.3
130.0
113.7
110
113.6
108
108.6
120.0
105.8
104.2
100 104.1
102
102
110.0
102.3
100.3
99.8
99.65
99
97.4
97.4
95.7
96
95.8
100.0
90
90.0
80 80.0
2013 Q1
Q2
Q3
Q4
2014 Q1
Q2
Q3
Q4
2015 Q1
Q2
Q3
Q4
2016 Q1
Q2
Q3
Q4
2017 Q1
Q2
Q3
Q4
2018 Q1
Q2
Q3
Q4
2019 Q1
Q2
Q3
Q4
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Following the recession, retail sales stabilised in Retail sales in the UK remained flat from 2008 Retail sales have a major seasonal peak in Household equipment continued to be the
2012 and 2013 and resumed growth in 2014 until 2012, picked up in 2013 and 2014 and November-December, 50% above the monthly fastest growing category this year, up by 11%
and has grown steadily each year since then. accelerated in 2015 and 2016, with volume up average for the rest of the year. Sales growth in volume and 4% in value in Q4, year-on-year.
The years from 2015 to 2017 averaged growth 5% per annum.33 Growth fell back in 2017 and was strong in 2016 and 2017, up 5% in volume Sub-categories within that - electrical goods
of 4% per annum in real, volume terms, reaching 2018, to 2%, and softened further in 2019 to and 3% in value on average. and furnishings - did exceptionally well, up by
a total of €45 billion in 2018, close to the last 1.6%.. Online sales accounted for 19% in 2019 12% and 7% respectively.
peak in 2007. up 6% year-on-year.34 Retail sales remained strong in 2019, up by 4.3%
in volume and 2.7% in value. This continued the Supermarkets and other food stores also
Retail sales remained strong in 2019, up by US retail sales have grown by 3-4% per annum positive trend from 2018 when sales were up by performed well, as did pharmaceuticals and
4.3% in volume and 2.7% in value. Retail sales for the last decade. Sales were up by 5% in 3.7% in volume and 2.7% in value but was lower cosmetics. Department stores and newsagents
revenue for 2019 amounted to approximately 2017, by 4.3% in 2018 and by a strong rate of than 2017 (+5.8% in volume and +3.5% in value). were the weakest categories in Q4, down by
€47 billion, back to the level last seen in 2007. 5.8% in 2019. Online sales accounted for 9% of Sales revenue for 2019 amounted to €47 billion -2.7% and -4.5% in volume respectively.
total retail but grew at a rate of 19% in 2019.35 which was back to the levels last seen in 2007.
Online sales have been taking an increasing Retail sales in the UK grew strongly in 2015
share of retail each year, amounting to €5 billion Online sales represented just 3.3% of total and 2016, up 5% per annum but this softened
in 2018, or 11%. sales for traditional (bricks and mortar) retailers to 2% in 2017 and 2.7% in 2018. Sales picked
operating in Ireland, although it was higher in up in 2019, up 3.4% in Q2, y-on-y. Online sales
some categories such as books (13.5%). This accounted for 19% in June 2019, up 8% year-
does not include online retail sales going to on-year.36
exclusively digital retailers (eg Amazon) which
amounted to about 11% of total retail sales.
33. http://www.ons.gov.uk/ons/rel/rsi/retail-sales/november-2018/stb-rsi-nov-15.html
34. https://www.ons.gov.uk/businessindustryandtrade/retailindustry/bulletins/retailsales/december2019
35. https://www.statista.com/statistics/379112/e-commerce-share-of-retail-sales-in-us/ 36. https://www.ons.gov.uk/businessindustryandtrade/retailindustry/bulletins/retailsales/june20192019 The Consumer Market Monitor is published by: The Marketing Institute of Ireland The Marketing Institute is the professional body for Ireland’s marketing people. It exists “to enable marketers to build great brands and great careers”. It does this by sharing best practice, insights and expert content, building the community of marketers, and aiding marketers in career progression. The three themes of content, community and career underpin all Institute activities. The Marketing Institute also owns and operates the All Ireland Marketing Awards, the CMO Summit, and DMX Dublin, Ireland’s largest marketing conference. The Marketing Institute of Ireland South County Business Park, Leopardstown, Dublin 18, Ireland Email: info@mii.ie, Web: www.mii.ie Contact: Gaelle Robert Email: gaelle@mii.ie UCD Michael Smurfit Graduate Business School The UCD Michael Smurfit Graduate Business School is Ireland’s leading business school and research centre offering world-class business programmes that equip students to become future industry leaders. It is the only business school in Ireland, and one of an elite group of schools worldwide, to hold the ‘triple crown’ of accreditation from three centres of business and academic excellence- EQUIS, AACSB and AMBA. Academic programmes at UCD Smurfit School consistently rank among the world’s best and are accredited by the most internationally respected organisations. The Masters in International Business Management is ranked 7th in the world by the Financial Times and the school is ranked 24th among leading European business schools. Engagement efforts have resulted in one of the world’s top, business school, alumni communities with over 75,000 professionals around the globe in over 35 international chapters. Along with academic administration, leadership derives from two advisory boards, the Irish Advisory Board and the North American Advisory Board. The UCD Michael Smurfit Graduate Business School is one of four constituent parts of The UCD College of Business and offers postgraduate courses, including the MBA and a wide range of MScs in business, to approximately 1,300 students per year. The Michael Smurfit Graduate Business School opened a campus solely dedicated to graduate business education in 1991 and grew most recently with a new centre for PhD research in 2017. UCD Michael Smurfit Graduate Business School University College Dublin, Carysfort Avenue, Blackrock Co. Dublin, Ireland Email: info@smurfitschool.ie, Web: www.smurfitschool.ie Contact: Professor Mary Lambkin Email: mary.lambkin@ucd.ie
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