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Greek Consumers Cut Alcohol, Fast Food as Austerity Bites

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However, the shift in personal spending habits could very well enrich the Greek populace in other, non-material ways.

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Over the weekend, Athens newspaper Kathimerini ran a headline reading: "Alcohol and fast food are first to go for Greek consumers."

Quoting a recent study by the Boston Consulting Group, Kathimerini reports 58% of Greeks "are planning to reduce their food budget," beginning with spirits (70% of respondents), beer (71% of respondents), and fast food (71% of respondents).

According to BCG, "more Greeks today are spending what little they have left on the absolute essentials, such as dairy and fresh produce, and displaying a consumer behavior pattern that is usually associated with lower-income groups."

However, the shift in personal spending habits could very well enrich the Greek populace in other, non-material ways.

The BCG survey found that "the economic crisis has helped Greeks rediscover the joys of entertaining or visiting friends at home rather than going out for a meal or drinks."

Will a coming wholesale shift in Greek dining habits have a material effect on brands such as McDonald's (MCD) and Pizza Hut (YUM)? Will a company like Diageo (DEO) be hurt by a decrease in liquor consumption among Greeks? And what of InBev (BUD) or Molson Coors (TAP)?

"I do think that the big multinational brands are at risk, since I actually think Greeks will cut back on 'international' fast food," says President of Financial Insyghts LLC and Minyanville contributor Peter Atwater. "It's kind of ironic, because foreign countries see these companies as being American, but talk to any American small business owner and they'd tell you that they might as well be from overseas -- 'they aren't hiring here, they don't pay taxes here…'"

Atwater mentions a "migration to intangibles from tangible assets," which represents an "inwardness that goes right along with social mood."

"Nationalism, protectionism, etc. are all signs of the same migration," he explains. "But there are good things that can come out of this, too. Learning to borrow things versus buying them; spending time dining in with friends and family."

Findings by Gallup in the 2008 Healthways Happiness-Stress Index buttress this point, which underscored "the crucial role of spending time with friends and family" in determining one's "daily emotional well-being."



From Gallup:

Of the more than 140,000 Americans Gallup-Healthways has surveyed so far, the individuals who report being alone all day (zero hours of social time) perform the poorest on the Happiness-Stress Index, with only 32% experiencing much enjoyment/happiness and nearly as many experiencing intense stress and worry (27%). This results in a happiness-stress ratio of 1-to-1. The reverse is true for those who devote a large part of their day to social time, with the happiness-stress ratio rising for each additional hour of time spent socializing up to six to seven hours -- at which point the happiness-stress ratio peaks. Among those who report spending six to seven hours of social time with family and friends on any given day, those experiencing a lot of enjoyment and happiness (54%) outnumber those experiencing extreme stress and worry (5%) by a ratio of 12-to-1.

The food and beverage industries with operations in Greece have already begun introducing products "aimed at enhancing the experience of staying in, such as machines that make a wide variety of coffees, beer brewing kits, barbecues and foodstuffs that help bring fine dining into the home."

Considering that Greece was found by the UN's Food and Agriculture Organisation to have the "most dramatic" obesity problem in the entire European Union (75.6% overweight, 26.2% obese), a return to a more traditional Mediterranean diet may be another positive side effect of the nation's economic woes.

It could also conceivably elevate Greeks on the Happiness-Stress Index.

As former Italian Agriculture minister Paolo de Castro said after the FAO report was released, "The Mediterranean diet is a heritage that should be protected and shared. Science has long recognised the unusual health properties of the diet, which has strengthened and accompanied the common cultural identity of Mediterranean countries."

"I think you are going to see a lot changes on the food front" says Atwater. "To me the whole farm-to-table restaurant movement, the rise in CSA's [Community Supported Agriculture] and the boom in farmers markets are all indicators of a shift away from 'multinational' food. And it fits right in with changing social mood."
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