1 a summary update of the irish grocery market to 21 st march 2010 a presentation to the national...
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1
A SUMMARY UPDATE OF THE IRISH GROCERY MARKET TO 21ST MARCH 2010
A Presentation to the National Consumer Agency
May 2010
2© Kantar Worldpanel
Headlines
The market declined by 5% in value, losing over €460 million over 52 weeks
Household grocery spend shrunk by 7.5% in the same period
Move away from premium to budget products
Huge shift to products priced under €3
Cross Border share falling back
1
2
3
4
5
3© Kantar Worldpanel
The grocery market has shrunk by 5% year-on-year, falling below 2008 value
€9,047,705 €9,338,228€8,871,597
€2,140,442 €2,116,024 €1,957,723
52 w/e 23Mar 08
52 w/e 22Mar 09
52 w/e 21Mar 10
12 w/e 23Mar 08
12 w/e 22Mar 09
12 w/e 21Mar 10
52 we €000’s
+3.2% - 5%
12 we €000’s
-1.1% -7.5%
4© Kantar Worldpanel
HOW IS THE MARKET PERFORMING ON TRENDED BASIS? % VALUE CHANGE VS. LAST YEAR, 12 WEEKLY AND 4 WEEKLY TRENDED
-2.4
2.2
-1.5
-5.2
-4.0 -4.0
-5.4-6.1
-4.7
-5.7
-7.5
-8.6
-7.0 -6.9
-10
-8
-6
-4
-2
0
2
4
12 w/e 22Mar 09
12 w/e 19Apr 09
12 w/e 17May 09
12 w/e 14Jun 09
12 w/e 12Jul 09
12 w/e 09Aug 09
12 w/e 06Sep 09
12 w/e 04Oct 09
12 w/e 01Nov 09
12 w/e 29Nov 09
12 w/e 27Dec 09
12 w/e 24Jan 10
12 w/e 21Feb 10
12 w/e 21Mar 10
12-weekly % Change
4-weekly % Change
5© Kantar Worldpanel
€6,074
€5,618
52 we 2009 52 we 2010
€1,340
€1,240
12 we 2009 12 we 2010
€449
€418
4 we 2009 4 we 2010
Annual Grocery Spend Quarterly Grocery Spend Monthly Grocery Spend
-7.5% -7.5% -7%
Each household spent €456 less on groceries in the year to 21ST March 2010 versus same period last year
6© Kantar Worldpanel
6
Why are households spending less?C
ontr
ibut
ion
to %
Cha
nge
-7.5%
-6.3%+4%
-5.1%
Deflation Volume per
Household
Store Choice
Promotion or Product
Choice
Spend per Household
7© Kantar Worldpanel
58.1% of basket spend now on items priced under €3 – an increase of 5 points on last year
11.9
9.4
27.7
24.6
18.5
19.2
12.4
13
8.1
9.1
4.9
5.4
16.5
19.4
2010
2009
Under €1 €1-€2 €2-€3 €3-€4 €4-€5 €5-€6 €6+
5 point shift to items under €3
Average grocery basket price bands
8© Kantar Worldpanel
8
Budget products are the only ones showing sales growth within total grocery
24.1
33.7
24.9
8.68.7
% Packs
50.4
-2.6 -2.1-5.8
-10.6-20
-10
0
10
20
30
40
50
60
Budget Standard Good Premium SuperPrem
% Change in sales Share of sales
Median -75% Median -25% Median Price Median +25% Median +75%
9© Kantar Worldpanel
Trading down retailer is becoming less important in driving down household spend
-10
-8
-6
-4
-2
0
2
4
12
w/e
23
Ma
r 0
8
12
w/e
20
Ap
r 0
8
12
w/e
18
Ma
y 0
8
12
w/e
15
Ju
n 0
8
12
w/e
13
Ju
l 08
12
w/e
10
Au
g 0
8
12
w/e
07
Se
p 0
8
12
w/e
05
Oc
t 0
8
12
w/e
02
No
v 0
8
12
w/e
30
No
v 0
8
12
w/e
28
De
c 0
8
12
w/e
25
Ja
n 0
9
12
w/e
22
Fe
b 0
9
12
w/e
22
Ma
r 0
9
12
w/e
19
Ap
r 0
9
12
w/e
17
Ma
y 0
9
12
w/e
14
Ju
n 0
9
12
w/e
12
Ju
l 09
12
w/e
09
Au
g 0
9
12
w/e
06
Se
p 0
9
12
w/e
04
Oc
t 0
9
12
w/e
01
No
v 0
9
12
w/e
29
No
v 0
9
12
w/e
27
De
c 0
9
12
w/e
24
Ja
n 1
0
12
w/e
21
Fe
b 1
0
Volume per Household Store Choice Promotion or Product Choice
Con
trib
utio
n to
% C
hang
e
How are shopper coping strategies changing over time?
10© Kantar Worldpanel
So the gap between deflation and household spend is reducing
-15%
-10%
-5%
0%
5%
10%
15%
12 w
/e 2
3 M
ar 0
8
12 w
/e 2
0 A
pr
08
12 w
/e 1
8 M
ay 0
8
12 w
/e 1
5 Ju
n 0
8
12 w
/e 1
3 Ju
l 08
12 w
/e 1
0 A
ug
08
12 w
/e 0
7 S
ep 0
8
12 w
/e 0
5 O
ct 0
8
12 w
/e 0
2 N
ov
08
12 w
/e 3
0 N
ov
08
12 w
/e 2
8 D
ec 0
8
12 w
/e 2
5 Ja
n 0
9
12 w
/e 2
2 F
eb 0
9
12 w
/e 2
2 M
ar 0
9
12 w
/e 1
9 A
pr
09
12 w
/e 1
7 M
ay 0
9
12 w
/e 1
4 Ju
n 0
9
12 w
/e 1
2 Ju
l 09
12 w
/e 0
9 A
ug
09
12 w
/e 0
6 S
ep 0
9
12 w
/e 0
4 O
ct 0
9
12 w
/e 0
1 N
ov
09
12 w
/e 2
9 N
ov
09
12 w
/e 2
7 D
ec 0
9
12 w
/e 2
4 Ja
n 1
0
12 w
/e 2
1 F
eb 1
0
12 w
/e 2
1 M
ar 1
0
Inflation / Deflation
% Change in Household Spend
10
6 point gap
1 point gap
11© Kantar Worldpanel
Why are shoppers staying down South?
They stocked up over the Christmas period1
Spend per Trip in December €60Spend per Trip in March €53
12© Kantar Worldpanel
0.92
0.89
0.92
0.90
0.88
0.860.86 0.86
0.89
0.92
0.90 0.90
0.880.88
Jan-09
Feb-09
Mar-09
Apr-09
May-09
Jun-09
Jul-09
Aug-09
Sep-09
Oct-09
Nov-09
Dec-09
Jan-10
Feb-10
Why are shoppers staying down South?
Exchange rate advantage continued to erode2
Source: www.x-rates.com
13© Kantar Worldpanel
Why are shoppers staying down South?
Shopping in the Republic is becoming cheaper still3
Cost of basket of 85 commonly purchased branded goods and fresh produce fell by 7% last year
16© Kantar Worldpanel
16
Inflation And Household Spend GrowthTrading up not as high as in previous months
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
02
No
v 0
8
30
No
v 0
8
28
De
c 0
8
25
Ja
n 0
9
22
Fe
b 0
9
22
Ma
r 0
9
19
Ap
r 0
9
17
Ma
y 0
9
14
Ju
n 0
9
12
Ju
l 09
09
Au
g 0
9
06
Se
p 0
9
04
Oct
09
01
No
v 0
9
29
No
v 0
9
27
De
c 0
9
24
Ja
n 1
0
21
Fe
b 1
0
21
Ma
r 1
0
% c
ha
ng
e
12 we Household Spend Growth 12 we InflationGrocery (RST) 12we 21 Mar 2010 (KWP P04)
17© Kantar Worldpanel
While in the UK Standard and Super-Premium offerings are showing strongest growth as shoppers are beginning to trade back up into brands
24
22
34
12
8.8
% Packs
2.5
-0.7
7.5
2.0
-0.6
6.3
-2
-1
0
1
2
3
4
5
6
7
8
AllPurchasing
Budget Standard Good Premium SuperPremium
% Change in sales Share of sales
Median -75% Median -25% Median Price Median +25% Median +75%
18© Kantar Worldpanel
18
Grocery Coping StrategiesConsumers using promotions to trade up in volume and quality
1.8
1.2
0.2
1.6
2.2
0.5
Inflation HH VolumeChange
Store Choice PromotionChoice
Product Choice HH SpendChange
con
trib
utio
n t
o c
ha
ng
e %
pts -
Grocery (RST) 12we 21 Mar 2010 (KWP P04)
19© Kantar Worldpanel
19
-6%
-5%
-4%
-3%
-2%
-1%
0%
1%
2%
3% 2
0 A
pr
08
18
Ma
y 0
8
15
Ju
n 0
8
13
Ju
l 08
10
Au
g 0
8
07
Se
p 0
8
05
Oct
08
02
No
v 0
8
30
No
v 0
8
28
De
c 0
8
25
Ja
n 0
9
22
Fe
b 0
9
22
Ma
r 0
9
19
Ap
r 0
9
17
Ma
y 0
9
14
Ju
n 0
9
12
Ju
l 09
09
Au
g 0
9
06
Se
p 0
9
04
Oct
09
01
No
v 0
9
29
No
v 0
9
27
De
c 0
9
24
Ja
n 1
0
21
Fe
b 1
0
21
Ma
r 1
0
con
trib
utio
n t
o c
ha
ng
e %
pts
Volume change Store Choice Promotions Product Choice
Grocery Coping StrategiesTrading up increasingly driven by volume and less about quality
Grocery (RST) 12we 21 Mar 2010 (KWP P04)
20© Kantar Worldpanel
20
Promotional Mechanics Contribution To Growth% extra free and price cuts drive growth, as full price sales continue to fall
-4%
-2%
0%
2%
4%
6%
8%
10% 2
2 M
ar
09
19
Ap
r 0
9
17
Ma
y 0
9
14
Ju
n 0
9
12
Ju
l 09
09
Au
g 0
9
06
Se
p 0
9
04
Oct
09
01
No
v 0
9
29
No
v 0
9
27
De
c 0
9
24
Ja
n 1
0
21
Fe
b 1
0
21
Ma
r 1
0
Co
ntr
ibu
tion
to
gro
wth
%p
ts
Full price Price reduction Multibuy Y for £X Market growth
Grocery (RST) 12we 21 Mar 2010 (KWP P04)