Fresh - IRI · quality, price and assortment per day Importance of convenience and shopping...

Fresh Top Trends in

The Fresh Connection! May 19, 2016

Copyright © 2016 Information Resources, Inc. (IRI). Confidential and proprietary. 2

FMI is the trade association that

serves as the voice of food retail.

We assist food retailers in their role

of feeding families and enriching

lives.


ASSET PROTECTION

EDUCATION RESEARCH

FOOD SAFETY & DEFENSE

GOVERNMENT RELATIONS

SUSTAINABILITY

SUPPLY CHAIN

HEALTH & WELLNESS

PRIVATE BRANDS

FRESH FOODS INFORMATION SERVICE

CENTER STORE CONSUMER &

COMMUNITY AFFAIRS INDEPENDENT

OPERATOR

COMMUNICATION WHOLESALER

TECHNOLOGY

The Association:

Our members are food retailers, wholesales and

suppliers of all types and sizes

FMI provides comprehensive programs,

resources and advocacy for the food, pharmacy

and grocery retail industry


Fresh @ FMI

Fresh Foods

Emphasis on fresh

• Produce

• Meat

• Seafood

• Deli/In-store, fresh prepared foods and

assortments

FMI is committed to the growth and success of fresh

companies and their partners. FMI provides resources

and networks that support the interests of member

companies throughout the global, fresh produce supply

chain, including family-owned, private and publicly

traded businesses as well as regional, national and

international companies.

Rick Stein Vice President, Fresh Foods

Food Marketing Institute

[email protected]

202.220.0700


FMI Fresh Foods

Research and Education

In-depth information, trends and

insights to foster innovation,

take advantage of new

opportunities and help develop

winning strategies

Networking

Share ideas, explore best

practices and develop business

relations

Advocacy

Understand what is going on in

Washington and make your

voice heard


FMI Fresh Executive Committee John Ruane (Co-Chair)

Ahold USA

Rick Steigerwald (Co-Chair)

Lund Food Holdings, Inc.

Tom DeVries (Past Chair)

Giant Eagle, Inc.

Jason Anderson

Affiliated Foods Midwest Cooperative, Inc.

Bill Artman

Giant Eagle, Inc.

John Beretta

Albertsons, LLC

Dave Bornmann

Publix Super Markets, Inc.

Scott Bradley

Target Corporation

Jerry Chadwick

Lancaster Foods, LLC

Alex Corbishley

Target Corporation

Chris Darling

Albertsons, LLC

Jerry Edney

Associated Wholesale Grocers, Inc.

John Grimes

Weis

John Haggerty

Burris Logistics

Mark Hilton

Harris Teeter LLC

Christopher Lane

Wakefern Food Corporation

Mike Malone

Brookshire Grocery Company

Dan Murphy

Unified Grocers, Inc.

Pat Pessotto

Longo Brothers Fruit Markets Inc.

Jerry Suter

Meijer, Inc.

Geoff Waldau

Delhaize America

Dan Wampler

Hy-Vee

Blaine Bringhurst*

Price Chopper Supermarkets

Steve Mayer*

Schnuck Markets, Inc.

Nicole Wegman*

Wegmans Food Markets, Inc.

* Silent members(*)

The FEC seeks to

• identify areas of

collaboration across all

fresh foods departments

• promote understanding

and cooperation

throughout the industry

and with sister fresh

associations

• maximize common

learning’s between fresh

categories and to create a

vision of leadership for the

entire fresh category

Fresh Foods


FMI Fresh Foods Leadership Council John Ruane (Co-Chair)

Ahold USA

Rick Steigerwald (Co-Chair)

Lund Food Holdings, Inc.

FEC Members

FMI Fresh Executive Committee

Glen Dolezal

Cargill

Chris DuBois

IRI

Michael Eardley

International Dairy-Deli-Bakery Association

Jim Ethridge

National Cattleman's Beef Association

Sherry Frey

Nielsen Perishables Group

Paul Mastronardi

Sunset Grown Produce

Michael Higgins

Hussmann

Henry Pellerin

Hill Phoenix

Jeff Oberman

United Fresh Produce Association

Janet Riley

North American Meat Institute

Tristan Simpson

Ready Pac Foods, Inc.

Tom Super

National Chicken Council

Jarrod Sutton

National Pork Board

Joe Watson

Produce Marketing Association

Joe Weber

Smithfield Foods Inc.

Art Yerecic

Yerecic Label

The FFLC is..

Comprised of FMI Member

companies, industry trade

association and fresh

focused knowledge partners

Fresh Foods


Our study focused on finding the keys to high performance

Objective

industry interviews primary data analysis secondary research

Inputs

Define the major trends that are driving Perimeter sales outperformance and

will directly impact long-term success of retailers and suppliers over the next 3-

5 years


Consumer Demands

Industry Response 5

Trends


Major Conclusions

Trends are still in the early stages of growth Embracing these trends drives sales outperformance Pursuing trends requires strategic perspective across departments Trends will set foundation for next generation of retail business success


Connected Consumer 3


The Consumer Landscape:

Dynamic Change, Enormous Opportunity for Growth

…with

increasingly

varied needs

…in a

fragmenting

retail landscape

…with dramatically

more complex

media stimuli

…requiring

personalization

Shoppers are

more diverse

than ever

Changing family

makeup and decision

making process

Increasing ethnic

diversity among US

shoppers

Quest for value =

quality, price and

assortment

Importance of

convenience and

shopping experience

Multi-channel

shopping and

channel blurring

eCommerce replacing

brick & mortar with

new business models

(home delivery,

click and pickup)

From the 1970’s 500

to today’s 5,000 ads

per day

Increasing shift in

mobile - $105B in ad

spend by 2020 on

mobile platforms

alone

The new path-to-

purchase leverages

digital, social,

mobile media

A tailored shopping

experience including

available product mix

and availability plus

specialized offers


Demographics Matter Millennials became the largest population segment in 2015

SILENT

BOOMER

GEN X

MILLENNIALS

Projected Population by

Generation (in Millions)


334M USA Population 2020

The U.S. Shopper is

Becoming More Diverse

309M USA Population 2010

3M White

10% growth

33M Hispanic

53% growth

4M Black

16% growth

4M Asian

15% growth

1M Other

5% growth

Hispanics will account for 53% of population growth


52% prefer brand

updates in email

vs. text

29% use a mobile

app to pay for

purchases

45% say they’re early

adopters of

technology

6 hrs/day average time

spent online

48% say they’re unable

to function without

their smart phone

Everyone is using digital today


In an internet minute…

701,389 FACEBOOK LOGINS

150 MILLION EMAILS SENT

2.78 MILLION VIDEO VIEWS

20.8 MILLION+ MESSAGES

972,222 SWIPES

$203,596 IN SALES

527,760 SNAPCHAT

PHOTOS

38,194 INSTAGRAM

PHOTOS


The traditional Shopper Journey

remains relevant for certain categories

PLANNING pre-store planning

NAVIGATING in-store

ACTIVATING context

PURCHASING in-aisle

USING product usage


Digital, social

and mobile play

an opportunistic role

in CPG shopping

behavior…


Nearly half of all consumers

go online to seek coupons

and sales from coupon, retailer

and manufacturers' websites

46.9%


Consumers are

more likely to search

retailer sites than

they are to visit

manufacturers’ sites


Social Media is a less

influential factor in shopping

planning, but a critical partner

in education and meal

planning which sets the table

for overall planning.


Millennials are the trailblazers of

shopping planning.


More

than 25%

Look for recipes online;

more of a factor among

Millennials and GenX vs.

Boomers


Over a third compare

prices; Millennials are

most likely to compare

at-home and in-store

35.9%


80%+ of Gen X and Millennials

are using online resources more

75%

3 in 4 shoppers claim to

use online resources at least as

frequently as they have in the past


About half of all shoppers still

use newspapers, store

circulars, and magazines to

plan-shows the impact of "old

traditional methods”, but far

below measures of just four

years ago

51.8%


Total Millennials GenX Younger

Boomers

Older

Boomers

82% 90% 84% 84% 69%

Use Of Online/Digital Resources Related To

Shopping For Fresh Foods Vs. Last Year

The Digital Divide Is Alive

Still Using This Year….


Are the Trailblazers, finding

it very important to

plan by shopping online.

Millennials and Gen X are

driving the pioneering by

being more inclined to find it

very important to go online to

plan their shopping.

Nearly 1 in 5


Over 60% say they do less than 30 minutes

of grocery prep – 11% do nothing at all

Total Millennials GenX Younger

Boomers

Older

Boomers

No planning 11% 9% 13% 9% 10%

< 30 minutes 49% 47% 44% 55% 57%

30 minutes - <1 hour 24% 25% 24% 23% 24%

1 hour 11% 13% 14% 8% 7%

2 hours 3% 3% 3% 4% 1%

2+ hours 2% 3% 3% 1% 0%


Impact on

Fresh

Can we change to meats, bakery,

breads and fruits and vegetables?


Some perimeter categories have similar levels of digital pre-tail activity as center store

% using any digital device prior to going to the store

48%

Personal Care

46%

Frozen Food

42%

OTC Medications

37%

Non-Alcoholic

Beverages

36%

Meat/Poultry

35%

Snacks

26%

Beer/Wine/Spirits

29%

Dairy

Significantly

more Millennials

used digital

pre-tail than

shoppers 35+

Source: IRI Shopper Path research, 2015


35%

34%

15%

14%

5%

53% No Pre-Shop

Activities

46% Pre-Shop

Digital

Activities

Total Grocery

20%

22%

6%

9%

5%

68% No Pre-Shop

Activities

31% Pre-Shop

Digital

Activities

Fresh Foods

Social Media Other Digital Manufacturer Retailer Digital Digital Coupons


List making among

meat/poultry buyers

81% of Meat/Poultry

buyers made a list

90% do not list a brand

yet

Q14. Which of the following did you do before you shopped for insert category from S.2? Q15. Did you make a note (mental or written) to buy…?


Once purchases are made

14% talk about their

experience digitally

Base = Past Week Buyers of Meat/Poultry

QUICK FACT: Across CPG categories,

Millennials are significantly

more likely to take some

type of post-purchase

action than those

shoppers aged 35+


The Digital

Mindset


DigitaLink Segmentation is based on Digital ownership, usage and lifestyles

The most digitally savvy segment, Digitize Me!, has doubled

25% Digitize

Me!

24% Show Me

the Money

21% Technophobes

16% Wired for Work

15% Socializers


Sees ad online while reading

about creative slow cooker ideas

Grabs phone to

add items to

shopping list app

Back to computer to

check retailer ads

Opens the store’s app at

checkout to save on her

purchase

After making dinner, comments

“fabulous meal solution with

flavor’ on Parents.com

Prices are best at her favorite local store so she heads there

Completes list and chooses

her favorite store because

its own app provided early

notification to upcoming

online specials

Digitize Mom seeks help on

Parents.com for fast and nutritious

family meals

Grocery Store


The Digitize Me! Segment is at the forefront of

creating a new path to purchase for CPG products

PRE-STORE

IN-STORE

AFTER PURCHASE


The most digitally engaged shoppers will lead the way

Make it

simple

Help me balance

convenience

and savings

Enable me to

bridge digital and

traditional

Help me but don’t

intrude

Let me have

control

Don’t clutter

my phone


ShopperSights 6.4 TV Markets

Target Definition:

Experian Mosaic Segments where MilleniaLink Segment HH Penetration 120+

Start activating where they live

Top Markets


Source: ShopperSights 6.0 – Simmons National Consumer Survey Dec 2013

To start activating

now in media they

consume

Target Pen Index 120+, Target Pen 10%+

Preferred

Magazines


Source: ShopperSights 6.0 – Simmons National Consumer Survey Dec 2013 Target Pen Index 120+, Target Pen 5%+

Preferred

Websites


Target Pen Index 120+ Source: ShopperSights 6.0 – Simmons National Consumer Survey Dec 2013

Preferred

TV

Networks


ShopperSights 6.0 Chain Store Guide & InfoScan Major Food-Club-Mass–Drug-Dollar Retailers

To start activating now

where they shop

Grocery Store


The Winning Recipe…

Limited planning time requires compelling digital content to engage consumers and shoppers Shoppers are more apt to seek shopping ideas from retailers’ websites; opportunistic for both retailers and manufacturers Connect with Millennials with unique recipe ideas to drive shopping trips Invest in social media marketing and capabilities Understand how to leverage the influence of the Digitize Me segment


Now Hear This…

Digital marketing is not a passing fancy, but a real necessity to win with today’s—and tomorrow’s shoppers But, don’t throw the “baby out with the bath water”—traditional marketing is, and will remain, a vital part of the knowledge and planning process. Millennials are as likely to use traditional marketing to plan as their older counterparts Recognize the importance of social media to promote and leverage social issues like Anti-biotic free, Non-GMO, organics and other pertinent “issues of the day!”


2016 Individual Trend Launches + Education Plan

Jan 28 Feb 25 Mar 30 Apr 28 May 19 June

Food

Transparency

Fresh

Prepared &

Specialty

Foodservice

New Supply

Chains

Next:

Connected

Consumer

Convenience

Chris DuBois Steve Ramsey Chris DuBois

FMI Connect

Refresh/Update

Content Plan

Communication

Plan

Sally Lyons Wyatt

Webinar

Webinar

Webinar Webinar Webinar

Larry Levin

Thank You! Larry Levin

[email protected]

(818) 450-7614

Rick Stein

VP, Fresh Foods

[email protected]

(301) 377-2779

Fresh - IRI · quality, price and assortment per day Importance of convenience and shopping...

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