There is already a crisis-related psychosis in many circles, fuelled by the pessimistic news about the soaring unemployment and salary declines, says Mircea Kivu, sociologist and general manager of the Marketing and Polls Institute (IMAS). Under the circumstances, he says, ”the consumer behaviour cannot but change, even though the individuals are not affected in any way by the crisis on a personal level.”

Though analysts and various institutions are pessimistic about the Romanian economy, the overall state of mind among the average consumers seems closer to cautiousness rather than anything else. Two thirds of the respondents of a survey conducted by market research company 360insights between January 15-February 15, 2009 on a sample of 800 people living in cities say they have no concrete information and do not know exactly what the crisis is, while more than half of them believe even now that everything might be just a momentary exaggeration of the media, because they are not feeling its effects directly.

A key element that makes people more cautious about their spending is the concern for their job.

Retailers confirm the decline of traffic in stores. Ilan Laufer, general manager and principal shareholder of Retail Group (the rental broker of Cocor Luxury Store), says that the retailers with which he has discussed lately have noticed a change in the overall consumer spending trends – especially on the electrical and IT, clothing, footwear or accessories segments. ”Sales are much lower in the first two months of this year than in the same time of 2008, with declines ranging from 20 to 50%.”

The higher the price, the faster the sales decline, which explains the order in which retailers are affected.

Real estate consultants say such changes occur especially outside the capital. Razvan Gheorghe, general manager of Cushman & Wakefield Romania said a little while ago that those who had opened stores outside Bucharest were the hardest hit, which is especially true for the fashion, restaurant and coffee shop businesses. ”Consumers are no longer going out as often as they used to; everything more expensive than the massmarket isn’t selling any more.”

Durable goods, electronics and home appliances started to show signs of a slowdown in sales as early as the end of last year, says Ciprian Moga, managing director of iQuest Consulting, a retail advisory firm. Once among top sellers, home appliances are not doing any better on hypermarkets’ shelves, either. Tjieerd Jegen, chief executive of the Real Romania network says that when it comes to non-food products and especially home appliances and IT products, customers focus on promotional offers mostly.

The fast moving consumer goods market is the least affected by the crisis psychosis and is not experiencing dramatic changes. 360insights’ research director Mihaela Alexandru says that the products consumers are unwilling to give up, for which they plan the lowest expense cuts, are food (11% of the respondents), utilities (24%) and personal care products (28%).

Shachar Shaine, chief executive of United Romanian Breweries Bereprod, the bottler of Tuborg and Carlsberg brands, is one of the few happy managers, because he can boast a 3% increase so far this year compared with the same time last year. The growth, however, comes from the retail segment, because the on-premise segment is seeing stagnation, as people prefer to drink at home rather than go out to do it.