We could all do with a sweet pick-me-up as the economy turns sour
Cadbury’s huge profit leap highlights an intriguing chocolate-related economic quirk.
Despite a dire housing market, stock markets slumping into bear territory and soaring crude oil prices, people are still willing to shell out a bit of their ever-shrinking income for a bar of chocolate.
Talking about the firm’s 46 per cent jump in first half profits, Cadbury chief executive Todd Stitzer said: “No matter how bleak economies look, people always go for treats and that’s why we have seen no real slowdown in the first half and we see confectionery as a robust category in difficult economic conditions.”
And it’s not just Cadbury which is riding high on people’s search for solace in chocolate when economic times get tough. Thorntons recently boasted an annual sales increase of 12 per cent and the $23 billion merger of Mars and Wrigley shows the confectionary sector remains defiantly optimistic.
So while cash-strapped consumers are shunning exotic holidays abroad, ditching their gas guzzlers in favour of cycling to work and switching to Aldi for their weekly shop, they are still reluctant to give up their chocolate fix.
As vices go, it seems chocolate is relatively easy on the pocket, and more importantly, delivers a momentary pick-me-up and a welcome distraction from the onslaught of grim economic news.
But it’s not just chocolate sales that are resilient against a tough financial backdrop – lipstick sales too provide an interesting insight into consumer psychology when we fall on hard times.
When money’s tight, rather than shelling out £300 on a pair of Manolo Blahniks, women opt instead for an affordable luxury which offers a little light relief but does not seriously dent the pocket.
On the same subject, casting a stealthy eye over your colleagues’ attire may furnish you with an indication of where your finances are heading.
Fashion magazines are heralding the return of “cover up” chic for women, with floor-sweeping maxi dresses big this season in styles not seen since the days of stagflation in the seventies. Low-heeled shoes, apparently, are also an indicator of financial distress, as is the fact we’re buying less bold colours.
Despite the eighties fashion revival not showing any signs of going away, sales of coloured tights at Asda are down by 52 per cent and black tights are up 35 per cent compared with last year.
And men too are not immune from a credit-crunch-induced lack of imagination when buying clothes – sales of white shirts are up 29 per cent.
It seems retreating into a cocoon and “comfort dressing” is putting in an appearance beside indulging in comfort eating.
It’s not surprising really – perhaps it’s something to do with an instinctive need to batten down the hatches, hide yourself away and increase your fat stores in case of leaner times ahead.
And intriguingly, or maybe I should say worryingly, weapons are the fastest growing segment of UK manufacturing, according to a report by the EEF manufacturers’ organisation this week.
So are these the effects of the credit crunch - dull clothes, boring shoes, increasing gun sales?
Excuse me while I just pop out to grab myself a Crunchie.
