sustainability strategies revolution private label behaviour inflation established markets deflation...
TRANSCRIPT
Sus
tain
abili
ty
Stra
tegi
es
Revol
utio
n
Privat
e La
bel
BehaviourInfla
tion
Established MarketsDeflationImpactSocial Media
Growth
Flat Lining
Global
Shopper Attitudes
Shopping
Convenience
Innovation
Localisation
Till Roll
Big 4
Post Recession
Media
PrioritiesP
enetrationM
ythsA
dvertisingD
igitalTrade C
hannelsG
rocery
Sh
opper In
divi
dua
ls
Insi
ght
Pric
ing
Inst
rum
enta
lity
Tren
dsB
aske
t Siz
eB
rand
sM
edia
Spe
nd
Life
Sta
ge
Change
Market D
ynamics
Crossroads
Households
Demographics
Consumer
Consumption
Online
Retail Landscapes
Income
DiscountersEvolution
SegmentationFrequencyAttitudesEstablished Brands
RetailersSuperm
arkets
Promotions
Simplicity
Household S
izeARE BRANDS THE BLUEPRINT FOR SUCCESS?
THE PRODUCE MARKET IS ARGUABLY EXPERIENCING ONE OF HER TOUGHEST PERIODS
• VOLUMES ARE DECLINING PER HOUSEHOLD OVER 5 YEARS
• DEFLATION HAS ERODED NEARLY £1/2 BILLION IN THE LAST YEAR
• THE DISCOUNTERS ARE DRIVING SPEND AWAY FROM THE MAJOR MULTIPLES
SO WHY LOOK TO BRANDS?
• THEY ALL OUTPERFORM THEIR MARKETS
• THEY DRIVE INCREMENTAL VALUE
• THEY PROVIDE SOLUTIONS
Long Term Volume Decline
102Number of times we purchase produce per year.
-11kgsDecline in produce volume of average household over 5 years
Potatoes
Apples
Pears
Brassicas
Legumes
Citrus
Bananas
Tropical Fruits
Root Crops
Salads
Soft Fruit
-300 -250 -200 -150 -100 -50 0 50 100
-281
-20
-12
-11
0
8
14
36
44
70
79
LONG TERM VOLUME CHANGE – KEY MARKETSMillions KGs
28%% of produce market in long term decline
Deflation
6-J
an
-13
3-F
eb
-13
3-M
ar-
13
31
-Ma
r-1
3
28
-Ap
r-1
3
26
-Ma
y-1
3
23
-Ju
n-1
3
21
-Ju
l-1
3
18
-Au
g-1
3
15
-Se
p-1
3
13
-Oct
-13
10
-No
v-1
3
8-D
ec-
13
5-J
an
-14
2-F
eb
-14
2-M
ar-
14
30
-Ma
r-1
4
27
-Ap
r-1
4
25
-Ma
y-1
4
22
-Ju
n-1
4
20
-Ju
l-1
4
17
-Au
g-1
4
14
-Se
p-1
4
12
-Oct
-14
9-N
ov-
14
7-D
ec-
14-1%
0%
1%
2%
3%
4%
5%Inflation
% c
ha
ng
eINFLATION GOES INTO REVERSE FOR THE FIRST TIME THIS CENTURY
PRODUCE PRICES 2014 -4.7%
-£486 mn
-13.1-11.8
-10.4
-8.0
-2.4 -2.3 -1.6 -1.0 -0.9
0.2 0.2
Average Price (£)/(g) | Yr on Yr % Change Total Produce | 52 w/e
THE BIG CATEGORIES ARE SLASHING PRICES
% PRICE/KG CHANGE YOY
PRODUCE TYPICALLY ACCOUNTS FOR 10% OF TOTAL GROCERY VALUE
BUT IN THE LATEST 12 WEEKS
7%
The Impact of The Discounters
8.3%
of Total Grocery
13% of produce volume
10% of produce value
90p
89p
89p
£1
PRODUCE POTATOES
£114mn £10mn
£66mn £6mn
SWITCHING GAINS
Sus
tain
abili
ty
Stra
tegi
es
Revol
utio
n
Privat
e La
bel
BehaviourInfla
tion
Established MarketsDeflationImpactSocial Media
Growth
Flat Lining
Global
Shopper Attitudes
Shopping
Convenience
Innovation
Localisation
Till Roll
Big 4
Post Recession
Media
PrioritiesP
enetrationM
ythsA
dvertisingD
igitalTrade C
hannelsG
rocery
Sh
opper In
divi
dua
ls
Insi
ght
Pric
ing
Inst
rum
enta
lity
Tren
dsB
aske
t Siz
eB
rand
sM
edia
Spe
nd
Life
Sta
ge
Change
Market D
ynamics
Crossroads
Households
Demographics
Consumer
Consumption
Online
Retail Landscapes
Income
DiscountersEvolution
SegmentationFrequencyAttitudesEstablished Brands
RetailersSuperm
arkets
Promotions
Simplicity
Household S
ize
SHOULD WE LOOK TO BRANDS?
These brands make up about 90% of the Branded Produce
market
VALUE +5% VOLUME +18%
BRANDED PRODUCE IS WORTH £291MN IN THE LAST YEAR
Basket Size
+6.8%
Frequency
+9.7%
© Kantar Worldpanel
22
BRANDVALUE
BRAND%CHANGE
CATEGORY % CHANGE
£108mn
+10%
-1.3%
£59mn
+4%
+2%
£19mn
+30%
-9%
£43mn
+3%
-14%
£9.9mn
+38%
-14%
+3%Value
Growth
+23%Volume Growth
4% more likely to be an AB SHOPPER
10% more likely to be
a 45-65 yr old
+25%More
Shoppers
£7.7mn in switching gains from
other Potato varieties
£1.2mn in incremental
spend added to category
BRANDS DRIVE VALUE FOR RETAILERS
Pink Lady Florette Bartlett Greenvale Farm Scotty Tenderstem
Category Arrivals Shoppers WonShoppers Held Total Switching
GREAT NEWS FOR THE CATEGORY - ALL THE BRANDS ARE DRIVING INCREMENTAL GROWTH
• AWP £ in Total Produce per Branded Buyer
Tenderstem
Greenvale Farms
Pink Lady
Bartlett
Florette
Scotty
Total0 50 100 150 200 250 300 350 400 450 500
451.06
400.92
371.24
350.54
340.66
335.35
277.37
GREAT NEWS FOR RETAILERS 1 - THOSE WHO BUY BRANDS IN PRODUCE SPEND A LOT MORE ON THE CATEGORY…
78% more
GREAT NEWS FOR RETAILERS 2 ….AND THEY SPEND A LOT MORE ON TOTAL GROCERY ALSOBRANDED PRODUCE BUYER VS AVERAGE PRODUCE BUYER (TOTAL GROCERY)
BRANDS ARE A POINT OF DIFFERENCE
45 50 55 60 65 70 7525
27
29
31
33
35
37
39
41
43
45
% of Class ABC1
% o
f H
ou
se
wiv
es
Ag
ed
Un
de
r 4
5
4 we 29 Jan 06
BrandedBroccoli
Leafy Salads
Potatoes
Apples
EACH BRAND FINDS ITS OWN SPOT IN THE MARKET
Sus
tain
abili
ty
Stra
tegi
es
Revol
utio
n
Privat
e La
bel
BehaviourInfla
tion
Established MarketsDeflationImpactSocial Media
Growth
Flat Lining
Global
Shopper Attitudes
Shopping
Convenience
Innovation
Localisation
Till Roll
Big 4
Post Recession
Media
PrioritiesP
enetrationM
ythsA
dvertisingD
igitalTrade C
hannelsG
rocery
Sh
opper In
divi
dua
ls
Insi
ght
Pric
ing
Inst
rum
enta
lity
Tren
dsB
aske
t Siz
eB
rand
sM
edia
Spe
nd
Life
Sta
ge
Change
Market D
ynamics
Crossroads
Households
Demographics
Consumer
Consumption
Online
Retail Landscapes
Income
DiscountersEvolution
SegmentationFrequencyAttitudesEstablished Brands
RetailersSuperm
arkets
Promotions
Simplicity
Household S
ize
CONCLUSIONNOT NECESSARILY TO LAUNCH A BRAND
IT’S NOT ABOUT PRICING & PROMOTIONSPROVIDE SOLUTIONSYOU NEED TO HELP THE RETAILERS IN PRODUCE
BUT TO THINK LIKE A BRAND
Sus
tain
abili
ty
Stra
tegi
es
Revol
utio
n
Privat
e La
bel
BehaviourInfla
tion
Established MarketsDeflationImpactSocial Media
Growth
Flat Lining
Global
Shopper Attitudes
Shopping
Convenience
Innovation
Localisation
Till Roll
Big 4
Post Recession
Media
PrioritiesP
enetrationM
ythsA
dvertisingD
igitalTrade C
hannelsG
rocery
Sh
opper In
divi
dua
ls
Insi
ght
Pric
ing
Inst
rum
enta
lity
Tren
dsB
aske
t Siz
eB
rand
sM
edia
Spe
nd
Life
Sta
ge
Change
Market D
ynamics
Crossroads
Households
Demographics
Consumer
Consumption
Online
Retail Landscapes
Income
DiscountersEvolution
SegmentationFrequencyAttitudesEstablished Brands
RetailersSuperm
arkets
Promotions
Simplicity
Household S
izeARE BRANDS THE BLUEPRINT FOR SUCCESS?