Consumer Trends, Snacking & Foodservice · Consumer Trends, Snacking & Foodservice Stephen...

Consumer Trends, Snacking & Foodservice

Stephen Griffiths

Consumer Insights, General Mills

Agenda

Macro Trends Affecting C-store

Convenience Store Traffic & Shopper

Snacking Insights

Foodservice in C-store

General Mills plays in many categories

SALTY SNACK BARS

FROZENCEREAL GROCERY YOGURT

SWEET PGD BAKERY Foodservice

How Insights Drive Growth

Three ways to grow, fueled by Consumer Insights

Base Business

• Renovation

• Pricing

• Advertising

Innovation

• White Space Exploration

• Ideation

• Product Testing

Shopper

• Category Management

• Shopper Profile

• Basket Analysis

How do I grow a

brand via base

business?

How do I grow

through new

products?

How do I grow

through in-store

excellence?

Macro Trends Affecting C-stores

Convenience is Being Re-Defined

1980’s 2000’s Future

Shift from convenient foods to convenient food preparation & delivery

From the 80’s through the 2000’s

we witnessed the convenience

revolution: convenience foodsoffered time saving meal solutions

Consumers, who now desire

natural foods, are shifting from

convenient food to convenient

preparation and procurement

Source: NPD Group, David Portalatin, 2018 New Year New Realities 7

Eating “in” Will Only Increase

Change Drivers

• Meatloaf

• Lasagna

• Spaghetti

• Chicken Parmesan

7-Eleven Meals

Source: NPD Group, David Portalatin, 2018 New Year New Realities. Dinner Deep Dive, 2018 by NPD Group. 8

The number of dinners per

capita at a restaurant is at

its lowest level since 1986*

Online sales continue to grow…

30% 2017 online grocery

penetration.

$20 Billion 2017 food & alcohol sales online.

2% 2017 online share of food &

alcohol sales.80% of U.S. HHs have the ability to order full baskets online today (either via delivery or click-and-collect).

Source; The Future of Ecommerce in FMCG, Kantar, 11/2017; The Digitally Engaged Food Shopper, Nielsen, 2/2018; GMI Analysis.

Expected to rise to 70%+ by 2025.

Estimated to rise to 10-20% by

2025.

Confidential. For internal use only. Do not distribute.

Home Bac

k

Next Return to

Ecommerce

Landscape

…and door-to-door delivery increases

2016

Over 50 Markets in 5

Years

1,000 Restaurants

17 U.S. Cities6,200 Restaurants

3,000 Restaurants

2017




Source: Technomic

Remember small format channels

CHANNEL CONSIDERATION: SNACKS(among total department trips)

85%

73%

43%38%

33% 32%

15%

44%

29%

10%7%

3% 3% 1%

GROCERY MASS CLUB DOLLAR DRUG C-STORE TOTAL ONLINE

Considered Channel Preferred Channel

Nielsen Category Shopping Fundamentals 2017 | CPG

Grocery and Mass dominate preference, but the

consideration set is wider for snacks

Know your competition by category

Cold beverages

• C-store Buyers prefer c-store

• Non C-store buyers prefer other outlets (grocery, mass, club etc.)

Prepared hot foods

• All consumers prefer fast food restaurant for prepared hot food

Prepared fresh foods• All consumers prefer other outlets. Fast Casual is best hot food channel

Packaged snack bars

• C-store wins vs. hot food channels, but other outlets are preferred

Packaged salty snacks

• C-store Buyers equally prefer c-store AND other outlets

• Non C-store buyers prefer other outlets

Source: Nielsen Homescan Panel Segmentation Survey Dec 2017; Q10. Where do you buy each of the following? (Select all that apply for each) Q11. In what type of stores do you most prefer to buy the following? (Select one each)

Preferred Hot Food Channel

C-store

QSR

Other, (Fast Casual)

Other (C-store)

C-store AND Other

Food / Bev Category

Hot Food Channels

• C-store/Gas Station

• Fast Casual

• QSR

• Coffee Shop

• Online Food Delivery

• All Other

Key Other: Traditional Retail Channels (Grocery etc.). Parentheses () indicates top Hot Food Channel

What Convenience Stores Must Deliver

One Stop Shop Provide Experience

More Fresh Offerings

At-Home Meal

Solutions

Beauty

7 Eleven $7 Date

Night

Large Pizza

Coca-Cola

Redbox Movie“I want something fresh, that doesn’t look like

it’s been sitting out all day.”

13

Convenience Store Traffic and Shopper Insights

Top Reasons to visit a C-store

• Urgency (need gas, food, drink, tobacco NOW) is key driver for c-store

• Tobacco and lottery tickets are key drivers unique to c-store

• Source: Nielsen Homescan Panel Segmentation Survey; Q21. Thinking about the last time you went to a convenience store/gas station, what motivated you to go there? (Select one)

• Q26. Since we have asked the previous questions about your last trip, was this last trip a typical convenience store/gas station trip for you?

Reason for last trip to Convenience store/ Gas station (%)

46 11 7 7 6 6 5 3 2 7ConvenienceStore Buyers

(n=2335)

I needed gas I was thirsty and wanted to buy something to drink

I wanted tobacco products I was hungry and wanted to grab a snack or some food

I wanted a lottery ticket I wanted coffee

I needed a staple like milk, butter or bread I wanted a treat

I wanted to buy alcohol Other

Gas/Fuel Thirst Hunger

Tobacco Lottery

Coffee

Motivations differ by day-part Coffee- Early Morning Trips

Snack/Food- Late Night

Why choose one c-store vs. another

Source: Nielsen Homescan Panel Segmentation Survey, “Core shoppers”

Q16. Below is a list of reasons why people might choose to shop at a convenience store/gas station. Please indicate how important

each is to you in deciding to shop at a convenience store/gas station.

C-stores: Focus on top drivers, then choose what else can differentiate from other c-stores

Cleanliness and Safety- Clean store and restrooms

- Feel safe in store

Most

Important

Gas- Sells gas

- Lowest gas price

Convenience in & out of store- Easy in/out from parking lot

- Fast checkout

Freshness of foods - Fresh foods

- Not past expiration date

Shopability- Employees are helpful

- Easy to navigate/find items

Less

Important

Value- Competitive Prices

- Frequent Sales

- Loyalty Programs

Assortment- Well stocked

- Good selection

Lifestyle/Expectations- Store meets expectations

- Store fits my values/lifestyle

C-store sales & conversion by daypart

Traffic is spread throughout the day, though breakfast is highest store traffic with highest closure rates

30% 28% 31% 41% 58% 73% 74% 67% 61% 61% 64% 68% 65% 66% 68% 67% 68% 65% 61% 57% 55% 52% 45% 35%

1%1%

1%

2%

4%

6%

7%

6%

5%5% 5%

6%

5% 5%6% 6%

5%

5%

4%4%

3%

3%

2%

2%

1 AM 2 AM 3 AM 4 AM 5 AM 6 AM 7 AM 8 AM 9 AM 10 AM 11 AM 12 PM 1 PM 2 PM 3 PM 4 PM 5 PM 6 PM 7 PM 8 PM 9 PM 10 PM 11 PM 12 AM

Closure % Buyers

Breakfast

19%Buyer Share

Lunch

16%Buyer Share

After Work

16%Buyer Share

Videomining 2017, sourcing 2016 data 17

Shopping Basket Analysis

Destination categories improve traffic flow

Lowest

Highest

Store

Closure:

55%

Avg.

Store

Basket:

$7.65

Videomining 2018, sourcing 2016 data

Placement of checkout is important

Lowest

Highest

Store

Closure:

62%

Avg.

Store

Basket:

$6.24


Consider dual door & category pairing

Lowest

Highest

Store

Closure:

74%

Avg.

Store

Basket:

$8.47


What items are purchased most?

Over half of all shoppers purchase a beverage product during their trip

Baskets with snacks have the highest spend on other product categories

-4 YoY

+3 YoY

No Change+2 YoY

+1 YoY

Source: 2018 Videomining

21

Shopping Basket Analysis54%

31%22%

17%8%

Beverages Tobacco Snacks Foodservice Alcohol

Avg. Dept. Units 1.5 1.4 1.6 1.5 1.4

Avg. Dept.

Basket$2.64 $8.96 $2.86 $3.52 $8.30

Avg. Store

Basket$6.35 $11.44 $7.51 $7.93 $11.74

Spend on Other

Store Products$3.71 $2.48 $4.66 $4.41 $3.44

No Change

Six Core Shopper Segments

Total Shoppers

Convenience Store Core Shoppers

Low FrequenC’s

Bevvy & Bites

Grub Grabbers

Booze Buyers Fresh Fill-In Puff N’ Go

Gas Only Convenience

Shoppers

Non-Convenience

Store Shoppers

SOURCE: Nielsen Homescan Panel 2017

40% of consumers

shop at c-stores

Snacking

Afternoon

Snacking

Healthy Fuel Salty

After Dinner &

Late Night

Snacking

IndulgentLight &

SweetSavory

Health & Productivity Convenience (Reaching Day’s End) Craving, Relaxation, & Connection

27% of snacks occur in the morning

42% of snacks occur

mid-day

8% of snacks

occur with or replace dinner

10% of snacks

occur in the late-night

13% of snacks

occur after-dinner

P.M.A.M.

Morning

Snacking

Healthy Fuel

Reasons for snacking differ through the day

Takeaway:

Offer a variety of snacks throughout the day in order to satisfy different needs.

Proprietary to General Mills Consumer Insights: Source: Hartman Group Modern Eating 2013 report; The NPD Group/National Eating Trends, November 201424

Snacking is Driven by Taste & Emotion

Emotional Motivations

59%

What is the Main Motivation for Snacking? (% of

Occasions)

Functional Motivations

41%

Proprietary to General Mills Consumer Insights: June 2016Source: General Mills Proprietary Milly database, 2017

25

Time of day for c-store snacks

12-

3am

3-

6am

6-

9am

9-

Noon

Noon-

3pm

3-6pm 6-9pm 9-

12am

RTE Cereal

Yogurt

Treat bars

Cookie/Wafer

Source: C-store Loyalty card data from a leading US Retailer, ending 1.13.2018

26

Key: 150+ Index, 120-149 Index, 119-81 index, 80-50 Index, <50 Index

Sweet & Indulgent Snacks are Afternoon Treats

12-

3am

3-

6am

6-

9am

9-

Noon

Noon-

3pm

3-6pm 6-9pm 9-

12am

Salty

Fruit Snacks



27

Other Snacks are Late-Night Items

12-

3am

3-

6am

6-

9am

9-

Noon

Noon-

3pm

3-6pm 6-9pm 9pm-

12am

Frz Hot Sncks

RTE Cereal



28

Foodservice

Consumer Perspective on Foodservice

Freshly Prepared Food Buying On This Trip (%)

36

32

31

16

9

8

4

4

Hot food (pizza, breakfastsandwiches, chicken tenders, etc.)

Bakery case items (donuts,muffins, cookies, etc.)

Roller grill items (hot dogs,taquitos, egg rolls, etc.)

Refrigerated sandwiches and subs

Made to order food (foodassembled for you)

Refrigerated burritos

Refrigerated salads

Other (Please Specify)

SmartShopper Mission Survey: Q2. Which of the following types of freshly prepared food

are you buying on this trip? Please select all that apply. Mobile missions for hot food

shoppers, taken during their shopping trip, December 2018.

136

25

67

Total Respondents(n=200)

In the car

At home

At work

At the store

Other

Place Of Consumption (%)

Most prepared food is sold in hot

case, bakery case and roller grill2/3 of consumers eat prepared food

in the car

SmartShopper Mission Survey: Q8. Where will you consume the

freshly prepared food? Please select one.

Hot Food Consumer

3.2

1.4

1.9

1.1

2.3

1.61.7

1.3

1.6

Breakfast

Sandwiches

Hot Dogs Tacquito Sausage Pizza Burger Snacks/Apps Chicken

Sandwich

Chicken Pieces

Most c-stores offer 1-3 varieties of each food

•C-Stores try to appeal to as many people as possible with wide assortment, but believe that going deep in a certain category is most likely not worth it

Prepared Food Assortments are wide not deep

Most → Least common items

Source: Seurat Group Audits 2017

Adjust assortment given QSR Context

Trip Frequency (%)

616

84

39

91

17

93

4 - 6 times a weekor more

2 - 3 times a weekor more

Once a week orless

Convenience Store Buyer (n=3630)

Gas Only C-Store Buyer (n=485)

Non C-Store Buyer (n=421)

Fast Food Restaurant

Since c-store shoppers are more likely to visit nearby QSR , ensure your pricing and assortment is competitive

Many c-store near a

Chick-Fil-A offer

chicken sandwiches

just on sundays

(when Chick-Fil-A is

closed)

Be aware of

promotions, pricing,

assortment nearby

(from c-store, small

format stores and QSR)

and adjust accordingly

C-store consumers are

also visit Fast Casual

restaurants a little more

frequently

• Source: Nielsen Homescan Panel Segmentation Survey December 2017

Breakfast & Lunch Are Largest

12 am 1 am 2 am 3 am 4 am 5 am 6 am 7 am 8 am 9 am 10 am 11 am 12 am 1 pm 2 pm 3 pm 4 pm 5 pm 6 pm 7 pm 8 pm 9 pm 10 pm 11 pm

Foodservice Food $ Sales by Time of Day

Source: C-store Shopper Loyalty Card information from leading US Retailer, 52 weeks ending January 2018

Two thirds of sales

occur from 5am -

2pm

Hot Food: Freshness, Assortment & Price

Source: Survey- “What if anything, prevents from buying Hot Food at C-Store”

Hot Foods need to communicate fresh

41%

31%

30%

28%

21%

19%

16%

8%

7%

4%

1%

29%

Sitting out long

Better options elsewhere

Too expensive

Not appealing

No options of interest

Not enough options

No healty options

Don't trust who made

Not quick

Not trusted brand

No food where buy gas

Nothing prevents me

Quality/Trust

Options/Variety

Value/Cost

Convenience

Hot Food Barriers in C-Store: Total Core Shoppers

How to Read: 41% of all c-store shoppers stated “Don’t

know how long food has been sitting out” as preventing

them from buying hot foods at c-stores.

29% of c-store shoppers said nothing prevents from

buying hot foods at c-stores

High

Barrier

Low

Barrier

• Having clean bathrooms

and store.

• Willing to invest in

infrastructure and

equipment

• Providing a menu of

offerings

• Being comfortable with

higher waste

• Dedicating labor to make

it happen

Foodservice mindset needed at store level, not just corporate level.

Foodservice Mindset: Key Differentiator

The #1 Indicator of

Success is Having a

Foodservice Mindset

Q&A

Consumer Insights

Stephen Griffiths

Consumer TrendsFoodservice

Snack Bars

Total C-store

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