reinvigorating the center of the store - nielsen · .9 contraction rte cereal soft drinks gum sugar...
TRANSCRIPT
Carman Allison – VP Consumer Insights
REINVIGORATING THE CENTER OF THE STOREOCTOBER 2015
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MEET YOUR PRESENTERS
CARMAN ALLISON
VP Consumer Insights
Nielsen
@CarmAllison
@Nielsen
JOE DAVIS
Director, Shopper Insights, Headquarter Initiatives
The Coca-Cola Company
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CENTER OF STORE CHALLENGES
MODERATE GROWTH WITH SALES SHIFTING TO FRESH
CONSUMERS ARE REDEFINING HOW THEY EAT
SHOPPING SHIFTS ARE PRESENTING NEW OPPORTUNITIES
1
2
3
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DEFINING CENTER OF STORE VS. PERIMETER
GroceryFrozen
DairyAlcohol
BakeryProduce
DeliMeat
Seafood
CENTER PERIMETER
FOOD FRESH
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IN THE PAST 2 YEARS, CENTER OF STORE HAS LOST 1.6% SHARE OF TOTAL STORE FOOD SPEND
Source: Nielsen Advanced Fresh Perspective – Food – Calendar Year Ends YTD Period ending June 27, 2015
CENTER PERIMETER
Shr. pt. chg. vs YA
2015 YTD
2014
2013
37.4%
36.7%
35.8%
62.6%
63.3%
64.2%
(+0.7)
(+0.9)
Dollar % Share
* Based on Nielsen sample stores
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64.9
63.4 63.5
64.963.9
62.5 62.6
64.463.1
62.0
35.1
36.6 36.5
35.136.1
37.5 37.4
36.0
36.9
38.0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2013 2014 2015
$ share Perimeter Center
Q1 AND Q4 ARE KEY QUARTERS FOR CENTER OF STORE
Source: Nielsen Advanced Fresh Perspective – Food – Quarterly Period ending June 27, 2015
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7Source: Nielsen Scantrack x AOC + Convenience. Period Ending August 22, 2015
CENTER OF STORE- TOTAL -
CENTER OF STORE - FOOD -
CENTER OF STORE- NON FOOD -
$709.4B$370.5B
$339.5B
+2.1%-0.1%
$56.7B
+2.2%-0.1%
$31.5B
+1.9%+0.4%
$25.2BAbsolute $ growth(Billions)
$CAGR (from 2011)Units CAGR
Latest 52 weeks(Billions)
THE DEMISE OF THE CENTER OF STORE IS GROSSLY OVERSTATED
52%
48%
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CENTER OF STORE - FOOD -
$370.5
+2.2%
$31.5Absolute $ growth(Billions)
CAGR (from 2011)
Latest 52 weeks(Billions)
GROCERY DAIRY FROZEN
$246.9 $71.2 $52.4
+2.4%
$22.4
+0.8%
$1.7
+2.8%
$7.4
Share of Center Food Growth
71% 23% 5%
GROCERY AND DAIRY CASE CONTRIBUTING TO THE LARGEST CENTER OF STORE GROWTH
Source: Nielsen Scantrack x AOC + Convenience. Period Ending August 22, 2015
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CONTRACTION
RTE Cereal
Soft Drinks
Gum
Sugar
Margarine
Frozen Entrees
Powder Inst Drinks
SS Juice & Drinks
Frozen Pizza
RTE Desserts
-$764.4 -2.1%
-$731.2 -0.7%
-$411.3 -3.1%
-$379.3 -3.5%
-$284.9 -4.3%
-$272.5 -0.6%
-$237.4 -6.1%
-$179.0 -0.5%
-$164.0 -0.9%
-$155.8 -5.5%
4 yrCAGR
BUT NOT ALL IS GROWING IN CENTER OF STORE
Consumers are changing their
eating habits for healthier
alternatives
Source: Nielsen Scantrack x AOC + Convenience. Period Ending August 22, 2015
Absolute $ Chg
Millions
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+$4,751.2 5.1
+$3,870.7 7.0
+$3,129.0 4.1
+$2,540.7 8.4
+$2,297.2 5.9
+$2,291.3 3.6
+$1,717.2 7.9
+$1,585.8 6.1
+$1,301.1 6.0
+$941.1 15.7
EXPANSIONAbsolute $ Chg
Millions
4 yrCAGRCONTRACTION
RTE Cereal
Soft Drinks
Gum
Sugar
Margarine
Frozen Entrees
Powder Inst Drinks
SS Juice & Drinks
Frozen Pizza
RTE Desserts
-$764.4 -2.1%
-$731.2 -0.7%
-$411.3 -3.1%
-$379.3 -3.5%
-$284.9 -4.3%
-$272.5 -0.6%
-$237.4 -6.1%
-$179.0 -0.5%
-$164.0 -0.9%
-$155.8 -5.5%
DECLINES OFFSET BY CATEGORIES WITH LARGE GAINS
Salty Snacks
New Age Beverages
Candy
Coffee
Water
Cheese
Eggs
Yogurt
Nuts
Liquid Coffee
Source: Nielsen Scantrack x AOC + Convenience. Period Ending August 22, 2015
Absolute $ Chg
Millions4 yrCAGR
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THE LARGEST MANUFACTURERS ARE NOT GROWING
Top 25
Next 75
Over 100
Store Brands
FOOD MANUFACTURERS
4 YR CAGR
+0.1%
+3.2%
+6.3%
+2.6%
Source: Nielsen U.S. Scantrack xAOC 52 weeks ending 2011 vs 2015
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PERIMETER
4 Year CAGR
PERIMETER SHARE OF FOOD GROWTH FUELED BY INCREASED SPENDING DUE TO HIGHER PRICES
+5.1%
+1.5%
$’s Vol
FRESH
Meat
Produce
Deli
Bakery
Seafood
$ Share $ Vol
39.2% +4.7 -0.1
32.2% +5.4 +2.0
16.2% +6.2 +4.2
7.6% +4.0 +1.9
4.7% +4.9 -0.1
4 Year CAGR
Sources: Nielsen Perishables Group FreshFacts , Total U.S. – 52 weeks ending December 2014
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19%
29%
29%
23%
SHOPPING THE PERIMETER 48% of Millennials and 36% of Boomers shop the perimeter of the store on some or most trips
Source: Nielsen March 2015 Online Views Survey, Grocery Shopping/Meals, n=23409
Millennials
On most trips
On some trips
On a few trips
On none of my trips
14%
22% 33%
31%
Boomers
48% 36%Total Tips
101Total Tips
151
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DESPITE MILLENNIALS VISITING PERIMETER ON A GREATER PORTION OF TRIPS, THEY CONSUME LESS
Age% of
Households Center of Store Perimeter
<35 15.6% 94 93
35-44 13.2% 109 108
45-54 18.8% 112 111
55-64 17.5% 109 110
>65 13.3% 95 101
DOLLAR INDEX
Families
Shift
Sources: Nielsen Homescan Total Store View , Total U.S. – Al l Outlets - 52 weeks ending June 27, 2015
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HISPANIC AND ASIAN CONSUMERS WILL FUEL FUTURE GROWTH FOR PERIMETER
% of Households Center of Store Perimeter
White Non Hispanic
75.8% 103 99
Hispanic 12.6% 102 111
African American 12.4% 86 97
Asian 3.7% 78 106
DOLLAR INDEX
Center of store needs to diversify to meet multicultural needs
Sources: Nielsen Homescan Total Store View , Total U.S. – Al l Outlets - 52 weeks ending June 27, 2015
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CONSUMERS ARE REDEFINING HOW THEY EAT
OUT OF HOME
MEALSOLUTIONS
SNACKING HEALTH AND WELLNESS
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AWAY-FROM-HOME SURPASSES SUPERMARKET SALES
Sources: U.S. Census Bureau, Advance Monthly Sales for Retail & Food Services, Total U.S., 4451: Grocery Stores & 722: Food Services & Drinking Places, Seasonally Adjusted Sales
$10
$20
$30
$40
$50
$60
1992 2010 June 2015
Bill
ion
s
U.S. Grocery Stores U.S. Food Services & Drinking Places
$27.8
$43.0
$50.5
$17.2
$37.6
$51.5
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RETAILERS AND CONSUMERS ARE RESPONDING
RETAILERS NEED TO WIN CONSUMERS’ SHARE OF STOMACH
Welcome to the Grocerant
Sources: Hy-Vee; Supermarket News
4 Year CAGR
+5.8%+3.9%
$’s Vol
Deli Prepared MealsPerformance
Sources: *Nielsen Perishables Group FreshFacts , Total U.S. – 52 weeks ending December 2014
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MORE THAN 60% OF CONSUMERS BUY TAKE-AWAY DELI PREPARED MEALS FROM GROCERY STORES
Grocery
Mass + SC
Warehouse
C&G
Drug
Pt. Change vs. 2013% of Consumers Shopping Prepared Meals
61%
23%
17%
17%
3%
+1
+2
+2
+0
+1
Sources: Nielsen Homescan Total Store View , Total U.S. – 52 weeks ending June 27, 2015
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WHAT’S TRENDING IN THE MEAL SOLUTIONS?
Sources: *Nielsen Perishables Group FreshFacts , Total U.S. – 52 weeks ending 7/25/2015 (vs . year ago)
2%
3%
4%
5%
5%
5%
7%
7%
8%
9%
9%
10%
10%
12%
Desserts
Platters
Breakfast Foods
Salads
Sides
Prepared Chicken
Entrees
Sandwiches
Snacks
Soups
Appetizers
Pizza
Dips/ Spreads
Sushi
Growth continues as shoppers choose meals and components over ingredients
D E
L I D
E P
A R
T M
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T
Center of store categories still play a
role in complementing the plate
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CENTER OF STORE CATEGORIES ACCOUNTS FOR 50% OF THE PLATE
% of Meal Occasion
Source: Canadian Consumption Diary, 2014-2015
48%52%
Breakfast Lunch Dinner
51%49% 51%49%
Perimeter Center of Store
Based on a Canadian study
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50% OF AMERICANS ARE SNACKING AS A MEAL REPLACEMENT – SKEWED TO CENTER OF STORE
Source: Canadian Consumption Diary, 2014-2015
Global Snacking Survey U.S. Respondents Q1 2014
Top 10 Snacks’Share of Store Area
60%40%
Perimeter Center of Store
50%
Snacking as a mealreplacement
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HALF OF AMERICANS ARE ACTIVELY TRYING TO LOSE WEIGHT
• Source: Nielsen Global Online Consumer Confidence Surveys – Q4 2014 - USA
60%consider
themselves overweight
50%are trying
to lose weight
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DIET DOMINATES WEIGHT LOSS EFFORTS AMONGST THOSE TRYING TO LOSE WEIGHT
Source: Nielsen Global Online Consumer Confidence Surveys – Q3 2014
Making a change in their diet
83%59%
59%
57%
48%
45%
Eating less fats
Eating less sugary foods
Eating more fresh foods
Portion control
Less processed foods
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HEALTH & WELLNESS TODAY IS VERY FRAGMENTED
21ST CENTURY 20TH CENTURY
Wellness Characteristics
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MAJOR SHIFT IN “WELLNESS” THAT DRIVES GROWTH
21ST CENTURY 20TH CENTURY
Wellness Characteristics
+6%
CAGR
0%
CAGR
Source: Nielsen xAOC 52 weeks ending Q1 2012 vs Q1 2015
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AMERICANS INTEND TO BUY MORE FRESH ITEMS% who intend to buy
35
32
20
19
13
11
11
6
8
12
11
12
15
18
Vegetables
Fruit
Meat & Poultry
Fish
Cheese
Bread
Deli Meats
Buy moreBuy less
+
+
+
+
+
Source: Nielsen Global Survey – Q3 2014 - USA
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ACTIONS TO DRIVE CENTER OF STORE GROWTH
MAXIMIZE ASSORTMENT
IN STORE MATTERS
MOST
FOCUS ON REVENUE GROWTH
THINK OUTSIDE THE
AISLE
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MORE CONSUMERS ARE SHOPPING CENTER OF STORE OUTSIDE OF CONVENTIONAL GROCERY
49.8%
20.8%
10.8%
5.1%
3.5%
2.2%
2.1%
1.2%
0.9%
Conventional Grocery
Supercenters
Warehouse Club
Value Grocery
Mass Merch + SC
Dollar Stores
Drug Stores
Premier Fresh Grocery
Online
2015 2011
-4.5
+3.2
+0.9
+0.6
-0.1
+0.4
-0.2
+0.1
+0.2
Share pt. chg
Sources: Nielsen Homescan Total Store View , Total U.S. – Al l Outlets - 52 weeks ending June 27, 2015
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SMALL FORMATS DRIVING STORE EXPANSION
Source: Nielsen TDLinx
38%
30%
20%
8%4%
Dollar Stores
C-Stores
Drug Stores
Grocery
Mass Merchandisers
% of U.S. Store Count Expansion in the Top 20 Expansion Chains2014 versus 2007
18,371 new
stores
80% of Americans are considered
urban
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# of items carried
Sales velocity
2013 vs. 2010% Chg
GROCERY DAIRY FROZEN
17% 16% 9%
-7% -4% -4%
MORE IS LESSMore choice means sales per item is in decline
Source: Nielsen Scantrack: xAOC 2013 vs. 2010
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SMALLER STORES PUT MORE PRESSURE ON CENTER OF STORE ASSORTMENT – NEED TO GET IT RIGHT
$100
$90
$70
Item
A
Item
B
Item
C
Item
D
Item
E
High Performing
Items
Item A Item B Item C
High Cannibalization
LowCannibalization
Size of bubble: $ volumeOverlap: Level of cannibalization
Sale
s ra
te (
$ s
ales
per
po
int
of
dis
trib
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CENTER OF STORE FOOD HAS A HIGHER PERCENT OF SALES ON PROMOTION - BUT THEY DON’T WORK
Source: Nielsen Scantrack x AOC + Convenience. Period Ending August 22, 2015
Nielsen Trade Promotion Landscape Analysis 2015
% Sold on Promotion% of Promotions that Don’t
Make Money
27.3%
21.0%
32.9%
Total Store
Center Food
Center Non- Food
71% Total Store
• 74% Dairy
• 73% Grocery
• 71% Frozen
Need to focus on promotional effectiveness to drive sales and profit
JOE DAVISDirector, Shopper Insights, Headquarter Initiatives
The Coca-Cola Company
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THINK OUTSIDE THE AISLE TO FIND NEW GROWTH
What is our value to the rest of the store, and how do we demonstrate that value to retail customers?
How do we leverage partners in the store to drive new growth with shoppers?
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BUILD NEW CONNECTIONS FOR SHOPPERS
Source: Nielsen Total Store Connectivity Study, 2014*Sales for Fresh Coverage Area - ~18,000 stores for Traditional Grocery, Supercenter, Mass and Club channels (not projected)
StrongWeak
Stro
ng
We
ak
RESONATE WITH BUYERS
Weak Sales Connection & Weak Basket Connection
FRESH, HEALTHY INDULGENCE
Fresh health categories, with focus on convenience and indulgence
DEMONSTRATE YOUR VALUE
Strong Sales Connection & Weak Basket Connection
BIG PLAYERS ACROSS THE STORE
Large categories, more center store focused with broad reach
DEVELOP PARTNERSHIPS
Weak Sales Connection & Strong Basket Connection
PLANNED - OCCASION BASED
Specialty categories purchased for a planned or special occasion
MANAGE CONNECTIONS
Strong Sales Connection & Strong Basket Connection
TRADITIONAL CONVENIENT/STAPLESCategories that are focused on convenience and quick prep time
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FIND THE SWEET SPOTLeverage the correlation between consumer preference and sales
Highsales
correlation
High buyer
overlap
SWEET SPOT
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LEVERAGE CATEGORIES TO CAPTURE INCREMENTAL PURCHASES
Source: Nielsen Total Store Connectivi ty Study, 2014
91% of purchases DON’T include
Diet Carbonated Soft Drinks
90% of purchases DON’T include
Regular Carbonated Soft Drinks
Find similar buyers, but rare basket affinities
HIGH INCOME, older large FAMILIES or empty nesters
Deli PreparedChicken Buyers
HIGH INCOME, large FAMILIES ranging in age
Regular CarbonatedSoft Drink Consumers
HIGH INCOME, older large FAMILIES or empty nesters
Diet CarbonatedSoft Drink Consumers
DIE
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BUILD RELATIONSHIPS WITH CATEGORIES THROUGH SMALLER TRIP TYPES
Source: Nielsen Total Store Connectivity Study, 2014
Diet Carbonated Soft Drinks Regular Carbonated Soft Drinks
11%
30%32%
16%
In the Basket:
Fill-intrips
VALUE-ADDED VEGETABLES
Diet & Value-Added Veg Diet
Value-Added Veg
Stock-Up trips
Quicktrips
87%
12%
1%
59%52%
9%
30%32%
17%
In the Basket:
Fill-intrips
Regular &Deli Entrees Regular
Deli Entrees
Stock-Up trips
Quicktrips
86%
13%
1%
61%51%
DELI ENTREES
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Do we need a slide describing the campaign? (VO option is below)
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INCREASED BASKET SIZES DRIVES JOINT BENEFIT
Source: Nielsen Homescan Total Shopper View:YAGO: 8/5/12-12/29/12; Test: 8/4/2013- 12/28/13Source: Nielsen Homescan Total Shopper View: 8/4/2013- 12/28/13 versus year ago“Coke Effortless Meals Products” refers specifically to the packs included in the Effortless Meals program
CAMPAIGN PRODUCTS EXPERIENCED
53% GROWTH IN SALES
INCREASE IN HOUSEHOLDS BUYING DELI PREPARED FOODS8%
WERE ALSO NEW TO COKE AT THE STORE
19%
basket size with the other product (vs. without)
DELI PREP FOODS SHOPPERS
COCA-COLA SHOPPERS
+59%
+47%
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CREATE VALUE FOR EVERYONE
• Leverage the growing importance of Fresh
• Stay on trend with meal preparation and recipes
• Think outside the aisle for growth partners
• Know your brands’ relationship with other categories
• Focus on promotional effectiveness to drive sales and profit
• Maximize assortment to reduce cannibalization
• Offer portable and snacking options to meet the growing
consumer need for on-the-go convenience.
• Connect with new 21st Century growth drivers of health and
wellness
• Grow the basket by diversifying product offerings to meet the
growing needs of multicultural consumers
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NIELSEN PERISHABLES GROUP [email protected]
HOMESCAN [email protected]
ASSORTMENT AND SPACE OPTIMIZATIONREVENUE MANAGEMENT & [email protected]
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