UNDERSTANDING TODAY S PRODUCE CONSUMERS AND REACHING THEM IN NEW WAYS UNITED FRESH 2014

Transcription

1 UNDERSTANDING TODAY S PRODUCE CONSUMERS AND REACHING THEM IN NEW WAYS UNITED FRESH 2014 NIELSEN PERISHABLES GROUP JUNE 12, 2014

2 UNDERSTANDING TODAY S PRODUCE CONSUMERS AND REACHING THEM IN NEW WAYS NIELSEN PERISHABLES GROUP JONNA PARKER DIRECTOR OF ACCOUNT SERVICES

3 IN THIS SESSSION, WE LL COVER: PRODUCE: DRIVER OF FRESH GROWTH SHOPPER DYNAMICS: UNDERSTANDING MULTI-DIMENSIONAL CONSUMERS IS KEY TO PRODUCE SUCCESS CATEGORY PERFORMANCE: WHAT S WINNING AND WHY

4 PRODUCE: DRIVER OF FRESH GROWTH

5 Copyright 2012 The Nielsen Company. Confidential and proprietary. FRESH IS GROWING SALES AND GAINING GROUND DOLLAR GROWTH 29% of sales 13% of space VOLUME 3% GROWTH 2% 7% 3% 6% 2% 6% 2% 1% 1% 1% 5% 4% 4% MEAT -1% PRODUCE 3% DELI BAKERY 3% SEAFOOD 1% 39% 32% MEAT PRODUCE 16% DELI -6% -0% MEAT PRODUCE DELI BAKERY SEAFOOD 8% BAKERY 5% SEAFOOD Latest 52 Weeks 1.1% 0.2% TOTAL STORE Source: Nielsen Perishables Group FreshFacts Total U.S. (FCA) weeks ending 4/26/2014 vs. Year Ago and Total U.S. - All Outlets Combined, plus Convenience ending 5/11/2014 (UPC only) 5

6 Copyright 2013 The Nielsen Company. Confidential and proprietary. FRESH IS WELL-POSITIONED TO SUCCEED IN ALTERNATIVE CHANNELS % department dollars by channel to Total U.S. Traditional Grocery Source: Nielsen Homescan Channel Facts 52 weeks ending 3/29/2014 6

7 Copyright 2013 The Nielsen Company. Confidential and proprietary. SHOPPERS SEEK FRESH IN ALTERNATIVE CHANNELS CONVENIENCE STORES DRUGSTORES DOLLAR STORES TRIPS PER HOUSEHOLD PERISHABLES +5% vs YAGO PRODUCE +5% vs YAGO TRIPS PER HOUSEHOLD PERISHABLES +5% vs YAGO PRODUCE +11% vs YAGO TRIPS PER HOUSEHOLD PERISHABLES +4% vs YAGO PRODUCE +4% vs YAGO Source: Nielsen Homescan Total Shopper View 52 weeks ending 12/28/13 versus year ago 7

8 Copyright 2012 The Nielsen Company. Confidential and proprietary. CONSUMER PRIORITIES DRIVING PRODUCT SUCCESS Across fresh, products that fit into four main consumer priority areas are proving successful HEALTHY CONVENIENCE PREMIUM/ INDULGENT MULTI-CULTURAL/ GLOBAL Source: Nielsen Perishables Group FreshFacts Total U.S. 52 weeks ending 12/28/2013 vs. Year Ago; Products in each group are not mutually exclusive 8

9 Copyright 2012 The Nielsen Company. Confidential and proprietary. FRESH CATEGORIES WITH PRIORITY ATTRIBUTES DRIVING GROWTH 9% 7% 7% 3% 6% 5% 4% 7% DOLLAR GROWTH VOLUME GROWTH HEALTHY CONVENIENCE PREMIUM/INDULGENCE MULTICULTURAL/GLOBAL 37% 18% 7% 2% CONTRIBUTION TO FRESH DOLLAR SALES Source: Nielsen Perishables Group FreshFacts Total U.S. 52 weeks ending 12/28/2013 vs. Year Ago; Products in each group are not mutually exclusive 9

10 Copyright 2012 The Nielsen Company. Confidential and proprietary. CONSUMERS SEEK DIFFERENT TYPES OF VALUE CONVENIENT OPTION BECOMING MORE POPULAR VALUE-ADDED FRUITS VALUE-ADDED VEGETABLES PENETRATION: +1% +2% SPEND PER TRIP: +2% +4% DOLLAR SALES: +12% +14% EXOTIC FLAVORS ON THE RISE HEALTHY ISN T HEALTHY ENOUGH SPECIALTY FRUIT POWER FOODS CALORIE COUNTING SPEND PER TRIP: +3% DOLLAR SALES: +15% DOLLAR SALES MANGO +17% DOLLAR SALES POMEGRANATE +35% DOLLAR SALES PAPAYA +22% Sources: Nielsen Perishables Group FreshFacts 52 Weeks Ending 12/28/13, Total U.S. FCA; Nielsen Perishables Group FreshFacts Powered by Spire, a Datalogix Company, 52 Weeks ending 12/28/13; PMA 2013 trade show; brand websites 10

11 PRODUCE SHOPPER DYNAMICS

12 Copyright 2012 The Nielsen Company. Confidential and proprietary. THE PRODUCE SHOPPER BRINGS VALUE TO RETAIL 100% of households purchase produce 47 trips each year $333 spent on produce each year $56 spent per product basket Source: Nielsen Perishables Group Nielsen Homescan 52 weeks ending 3/29/

13 Copyright 2013 The Nielsen Company. Confidential and proprietary. WHO IS IMPORTANT TO PRODUCE Affluent Consumers Health Conscious Consumers Mature Couples Consumers Purchasing Premium Quality & Organic Products Families Consumers Preparing Home Cooked Meals Source: Nielsen Perishables Group Importance Score Methodology 13

14 Copyright 2013 The Nielsen Company. Confidential and proprietary. POWER SHOPPERS ARE PROFITABLE TO THE STORE Key fresh categories bring the most powerful shoppers to the store POWER SHOPPERS MOST PROFITABLE SHOPPERS POWER SHOPPERS = TOP 33% OF SHOPPERS WHO OVER-INDEX IN SPEND and FREQUENCY DRIVE 59% OF STORE DOLLARS ANNUALLY CATEGORIES MOST FREQUENTLY PURCHASED BY POWER STORE SHOPPERS Milk Carbonated Soft Drinks Salty Snacks Packaged Bread Bananas Cheese Confections Refrigerated Juices & Drinks Yogurt Cookies Ready-to-eat Cereal Eggs Canned Vegetables Crackers Shelf Stable Juices & Drinks Tomatoes Cream & Creamers Deli Bulk Meat Packaged Salad Potatoes Indicates Produce Categories Source: Nielsen Perishables Group FreshFacts Powered by Spire, a Datalogix Company, data ending

15 PRODUCE CATEGORY PERFORMANCE

16 Copyright 2013 The Nielsen Company. Confidential and proprietary. PRODUCE IS A DEVELOPED DEPARTMENT AND STILL GROWING PRODUCE CATEGORY Total Produce Dollar Share of Total Produce FRUIT 47% VEGETABLES 43% OTHER PRODUCE 10% Source: Nielsen Perishables Group FreshFacts, 52 Weeks Ending 4/26/14, Total U.S. FCA 16

17 Copyright 2012 The Nielsen Company. Confidential and proprietary. MATURE CATEGORIES MAINTAIN RELEVANCE TOP DOLLAR GENERATING CATEGORIES Berries Packaged Salad Apples Bananas Grapes Citrus Potatoes Tomatoes Value-Added Fruit Cooking Vegetables HOUSEHOLD PENETRATION DOLLARS VOLUME AVG RETAIL PRICE VS YA Above Department Avg. Source: Nielsen Perishables Group FreshFacts, 52 Weeks Ending 3/29/14, Total U.S. FCA 17

18 Copyright 2012 The Nielsen Company. Confidential and proprietary. FASTEST-GROWING FRESH CATEGORIES Seven of top-ten fastest growing fresh categories are in produce DELI PRODUCE Dips, Spreads and Toppings $994 million in annual sales +15% vs. YAGO Deli Breakfast Foods $71 million in annual sales +11% vs. YAGO Cooking Greens $362 million in annual sales +24% vs. YAGO Produce Beverages $972 million in annual sales +17% vs. YAGO Avocados $994 million in annual sales +15% vs. YAGO Specialty Fruits $502 million in annual sales +15% vs. YAGO MEAT Bacon $3 billion in annual sales +12% vs. YAGO Value-Added Vegetables $1.3 billion in annual sales +13% vs. YAGO * Citrus $2.5 billion in annual sales +12% vs. YAGO Squash and Pumpkins $585 million in annual sales +13% vs. YAGO * A top 10 produce dollar generating category Source: Nielsen Perishables Group FreshFacts 52 weeks ending 12/28/13; includes categories with over 50% ACV selling over the 52 weeks ending 12/28/13 18

19 Copyright 2013 The Nielsen Company. Confidential and proprietary. DROUGHT EFFECT ON PRODUCE INDUSTRY The drought is expected to have large and lasting effects on produce pricing Total U.S. Price Elasticity (Volume Drop from a 10% Price Increase) Less Price Sensitive More Price Sensitive Source: Recently published joint research by Arizona State University and Nielsen Perishables Group California Drought Impact Study 2014, 19

20 Copyright 2013 The Nielsen Company. Confidential and proprietary. KEY PRODUCE TAKEAWAYS DRIVER OF FRESH GROWTH Fresh is a mega trend and produce is a key driver of fresh growth SHOPPER DYNAMICS Produce has inherent qualities that consumers are demanding... Consumer mindsets and demographics are equally important in determining purchase behaviors CATEGORY PERFORMANCE Categories that are innovating, are succeeding Staying relevant will be critical in 2014 s price climate Source: Nielsen Perishables Group 20

21 PANEL DISCUSSION: 1 STEVE JARZOMBEK, ROUNDY S 2 KIT & DEB, BLOGGERS 3 QUESTIONS