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NEAR EAST OLIVE PRODUCTS
SYRIAN CONSUMER BEHAVIORSYRIAN CONSUMER BEHAVIOR
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IMPORTANCE OF OLIVES & OLIVE OIL IN THE SYRIAN DIETIntro
• 3’000 years of cultural significance
U d b 100% f th l ti• Used by 100% of the population
• Estimated consumption per capita is per year:
5 5k f li• 5.5kg of olives per person
• 5kg of olive oil per person
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IMPORTANCE OF OLIVES & OLIVE OIL IN THE SYRIAN DIETIntro
• Olive consumption habit:
• Especially at breakfast
I h• In mezzeh
• As topping (pizza, savory pastries, etc.)
Oli il i h bi• Olive oil consumption habit:
• Mainly used upon mezzeh or breakfast spread
• Preservation of food
• Cooking
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OLIVE OIL VS. EDIBLE OILSIntro
Type of oil Qty per year Main usageType of oil Qty per year Main usage
Soybean oil ~ 110’000 MT Frying
Palm oil ~ 70’000 MT Ghee
Cotton oil ~ 70’000 MT Frying
Sunflower oil ~ 90’000 Frying, Cooking, saladsalad
OLIVE OIL ~ 110’000 MT Mezzah, Preservation,
kicooking
NEAR EAST OLIVE PRODUCTS COMPANY PRESENTATION
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OLIVE OIL VS. EDIBLE OILSIntro
Consumption
24%24%
Soybean oilSoybean oil
Cottlon oil
Sunflower oil
16%16%
Palm oil
Olive oil
20%
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SEGMENTATIONThe Consumer
Rural UrbanPopulation Population
+50 years old 30 to 49 ld50 years old years old
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RURAL POPULATIONThe Consumer
• Most of rural population produces own olive oil
• Production self sufficient for their consumption
• Any excess production sold in market
• Price defined according to acidity
• Taste not a criteria of quality
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URBAN POPULATIONThe Consumer
• Study segmentation:
• + 50 years old vs. younger generation
M i diff i th d f h• Main difference is method of purchase
• Older generation still accustomed to annual storage. Choose to buy whole year consumption during the season in 16kg tinsconsumption during the season in 16kg tins.
• Purchase habit changing with younger generation:
Li it d h i• Limited purchasing power
• New houses smaller hence a lack of storage space
• Impractical usage of 16kg tins (prefer smaller packaging)
• Nevertheless, expectations and usage of product remains the same among whole Syrian population
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QUALITYBehavior
• Three main types available in the market:
• Extra virgin olive oil
• Virgin olive oilg
• Ordinary olive oil (still permitted in Syria)
• No market for pure or pomace olive oilp p
• Consumer not concerned with the type
• Prefer sweet tasting olive oil
• Consumer misconception that good olive oil is greenConsumer misconception that good olive oil is green
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PACKAGINGBehavior
• Rural population:
• More than 95% sold in 16kg tins
• Urban population:
• Consumers above 50 mainly buy 16kg tins
Y i d b ll k i• Younger generation tends to buy smaller packaging.
• Most popular size after 16kg is 5lt and 4lt.
• 5lt and 4lt are mainly sold in PET rather than tins
• Consumers prefer seeing product
• Cheaper than tins
• In volume, sales of glass bottles are marginal
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RECURRING OLIVE OIL PURCHASES (PER CAPITA)Behavior
• Rural population:
• Acquired once a year during the season
• Urban population:
• 63% purchase annually
16% h bi ll• 16% purchase bi‐annually
• 10% purchase quarterly
• 9% purchase monthly
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WHO IS THE DECISION MAKER?Behavior
• Rural population decision maker:
• Male of the household
• Urban population decision maker:
• 62% of purchases done by male of the household
22% f h d b h if• 22% of purchases done by housewife
• 16% is done by other family members
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PRICE EFFECTBehavior
Press
Press Selling Price
Price to consumer
3.00 USD / kg
Price to professional
2.76 USD / kg
Selling Price Wholesale
3.24 USD/kg
Factory
3.50 to 5.22 USD / kg
Retail Selling Price
Distributor
4.10 to 6.14 USD / kg
Consumer Selling Price
USD / kg
Retail
4.60 to 7.00
NEAR EAST OLIVE PRODUCTS COMPANY PRESENTATION
Selling Price USD / kg
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PRICE EFFECTBehavior
• Syrian market extremely price sensitive
A• As a consequence:
• 84% of sales still done in 16kg tins
• 84% sold outside of retail sector
P l f b bi i h h b l d S i i d• People prefer to buy big sizes rather than bottles due to Syrian mindset getting more value for their money
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MARKET SHARE PER SEGMENTSales
Channels
24%16%
4%
Press
Wholesale
Retail
OtherOther
56%
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DIRECTLY FROM THE PRESSSales
Channels
• Consumers purchase annually at the press
All l i 16k ti• All sales in 16kg tins
• Three main motivators:
M ff i h d f i i d• Most cost effective method of acquiring product
• Guaranteed no mixing of oils
• Annual storage habit
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WHOLESALESales
Channels
• Wholesale includes direct delivery to consumer
Wh l l ll d t ith i i i l f k it d b d• Wholesaler resells product either in original form, or repacks it under own brand (in 16kg tins or 5lt PET)
• Consumer motivators:• Consumer motivators:
• Better prices than retail market
• Trustworthy link due to personal relationship developed over the years to acquire productacquire product
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RETAILSales
Channels
• Smallest segment due to:
• High availability to anyone outside retail market
St i diff i i t th h l• Steep price difference in comparison to other channels
• Offers all sizes ranging from 250ml to 16kg tins. Nevertheless, most outlets will carry 2 brands and 2 3 sizes per brand (excluding key accounts which have morecarry 2 brands and 2 ‐ 3 sizes per brand (excluding key accounts which have more selection)
• Consumer motivators:• Consumer motivators:
• Easy access
• Cleanliness
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DEVELOPMENT OF SALES CHANNELSSales
Channels
• Drastic change in method of purchase expected in upcoming 10 years:
St t d t d ll k i• Strong trend towards smaller packaging
• More practical
• Purchase power problem
• Purchasing power will continue to decrease
• Cost of living always more expensive
• Increase in salary not enough
• Unemployment problem
• New regulations will make it harder for wholesalers to sell own olive oil
• Not allowed to sell white tins in the market
• New regulations for customer protection will be issued.
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DEVELOPMENT OF SALES CHANNELSSales
Channels
• Development of the retail sector
Still t th b i i f th d• Still at the beginning of the road…
• Modern trade will take over on wholesale
• Decrease in small shops
C j h h i i• Consumer enjoy the shopping experience
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Thank You.