shaping the market in 2013/14 presentations/12-06...snacks and those who are prepared to pay more...
TRANSCRIPT
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© 2013 Mintel Group Ltd. All Rights Reserved. Confidential to Mintel
SHAPING THE MARKET IN 2013/14
David Jago, Mintel
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Everyday at Mintel
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Today’s presentation
• Key challenges facing the snacks industry now and for the
future
• How companies in different parts of the world are addressing
those challenges through product and package innovation
• Key drivers for growth, and how consumers behave and think
around issues including health, pleasure, naturality,
provenance, and affordability
• Growth areas and opportunities for the future
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Important factors when choosing snacks, February 2013
Price and “on special offer” rank among the most important factors in all countries; brand loyalty is especially high in the UK; natural
ingredients are key to at least 1 in 4 consumers
What drives consumer choice?
0
10
20
30
40
50
60
Price On special offer
A brand I trust
My usual flavour
Natural ingredients
(eg no additives)
France %
Germany %
Italy %
Spain %
UK %
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Walkers Deep Ridged Potato Crisps, UK
Lay's Xtra Onduladas Potato Crisps, Spain
The overall best-selling new snack products in Europe
include these PepsiCo products, featuring ridges
twice as deep for a bold flavour
Reported record sales of £19m across the range in
first twelve weeks
For just two variants, already sales of €3.5m in
13 weeks
Flavour is key to best-selling new products
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Bénenuts Twinuts flavoured biscuit
coated nuts, France
Lorenz Nic Nac's Flavoured Coated Peanuts, Germany
For best-selling new nut products in
Europe the emphasis is on
texture and strong flavour
Five variants (cheese, tomato, barbecue, bacon, Mexican) have first year
sales of €8.7m
€4.7m sales in 45 weeks, or average weekly sales of
€105,000
Flavour is key to best-selling new products
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Key challenges facing the snacks industry:
• Many snacks are not inherently healthy
• Consumers do not perceive snacks as “health food” but the
risk-reducing consumer wants balance and compromise
• Natural values are part of the health & wellness picture
• Snacks consumption is largely impulse- and pleasure-driven
• The experimental and experiential consumer wants variety,
novelty, new flavours and textures (up to a point)
Health versus pleasure
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Attitudes towards crisps, nuts and other salty snacks, February 2013
Flavour is more important than health factors for consumers in most markets; in fact, likelihood to buy healthy snacks is over-stated…
Health factors: a secondary driver
64 65
50 55
27 31
46
37
0
10
20
30
40
50
60
70
France % Germany % Italy % Spain %
Flavour is more important to me than calorie content
I always try and buy healthy (eg reduced fat/calories) crisps/salty snacks
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Snack introductions by claim category, as % total NPD, Europe
About a third of all snack introductions in Europe carry some form of natural positioning, significantly higher than “minus” (low-in) claims
or “plus” (high-in) claims; note growth in “suitable for” group
“Natural” is the primary driver in NPD
0%
5%
10%
15%
20%
25%
30%
35%
40%
2008 2009 2010 2011 2012 2013
Natural
Suitable for
Minus
Plus
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Funny Frisch Natürlich, Germany
Grefusa Snatt's NatuChips, Spain
Natural values can be simple as “no
artificial additives”, but that leaves little
space these days for differentiation
Products increasingly
emphasise clean labels and controlled ingredients
Potato crisps made only with natural ingredients, without artificial flavour
enhancers
100% natural baked snack made from cereals, potato and soy, with 70% less fat
“Natural” values expressed in snacks
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Snack introductions by top 5 claims, as % total NPD, Europe
The “no additives” claim has declined as it became ubiquitous;
Vegetarian and gluten-free claims have shown growth;
Organic remains surprisingly strong, while low/no fat is downward
Overt health values are low on the list…
0%
5%
10%
15%
20%
25%
2008 2009 2010 2011 2012 2013
No Additives
Vegetarian
Organic
Gluten-Free
Low/No Fat
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Snack introductions by low-in claims, as % total NPD, Europe
Overall decline in generic low fat claims; despite industry focus, few new products are labelled as having low or no transfats, saturated
fats or sodium
Overt health values are low on the list…
0%
2%
4%
6%
8%
10%
12%
Low/No Fat Low/No Transfat Low/No Saturated
Fat Low/No Sodium
2008
2009
2010
2011
2012
2013
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Walkers Baked Hoops and Crosses, UK
Funny-Frisch Chipsfrisch
Schwerelos, Germany
Wholegrain, source of fibre, 30% less fat
Uses 100% best sunflower oil, 30% less fat
Baked for a lighter, crispier texture, made with sunflower oil, less
than 10% fat
Kettle Baked Crisps, UK
Lighter oils, baked not fried
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Croky Air Pops, Netherlands
Metcalfe's Skinny Topcorn, UK
The use of lighter oils and “baked not fried” remain the
core focus
But key growth areas include
popped chips and popcorn
Potato chips “puffed with hot air”, 70% less fat
Popcorn made with all natural ingredients, 0.4g saturated fat, ideal with lunch or after the gym
Innovation in “better for you” snacks
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Attitudes towards crisps, nuts and other salty snacks, February 2013
For these four major European markets, at least a third of consumers think that healthy options are better than they used to be
Innovation in “better for you” snacks pays off
34
48
37
43
0
10
20
30
40
50
60
France % Germany % Italy % Spain %
Healthy crisps (eg reduced fat/calories) are tastier than they used to be
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Attitudes towards nuts, February 2013
At least 40% of consumers see nuts as a healthier option, and understand the nutrient benefits;
but salt content remains a hurdle for many
Consumers have better health perceptions of nuts
40 42 40
63 63 57 57
81
46
26
47 40
0
10
20
30
40
50
60
70
80
90
France % Germany % Italy % Spain %
Roasted nuts are healthier than crisps/other salty snacks
Roasted nuts are a good source of protein and vitamins
I would buy more nuts if the salt content was lower
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Duyvis onion & garlic peanuts, Netherlands
Blue Diamond Smokehouse almonds,
France
“Naturally rich in” message tends to
be subtly communicated in nuts; the main
emphasis is still on flavour
Naturally contain vitamins E, B1, B3,
phosphorous, magnesium & good unsaturated fats
Rich in vitamin E; contain 50% less fat than peanuts
and cashew nuts
Health positioning in snack nuts
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Key challenges facing the snacks industry:
• Retailers’ private label and discount brands have grown their presence in recent years
• Price is an important factor for consumers
• But treating and occasional indulgence are strong in a pleasure-driven category
• Strong opportunities exist for premium, occasional treats
Affordability versus the premium opportunity
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Attitudes towards crisps, nuts and other salty snacks, February 2013
Note the consistent gap between consumers who prefer branded snacks and those who are prepared to pay more for brands;
Significant numbers of consumers buy into premium snacks on offer
Consumers prefer brands but don’t want to pay more
38 32 32 34
52
42 43 40
44 42 48
33
0
10
20
30
40
50
60
France % Germany % Italy % Spain %
I am prepared to pay more for branded crisps/salty snacks
I prefer the taste of branded crisps/salty snacks to private-label ones
I only buy premium crisps/salty snacks when they are on offer
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Walkers Sensations peanuts, UK
• Seasoned with real ingredients
• Available in five varieties:
• Tuscan Sun Ripened Tomato & Basil
• Mexican Smoked Chilli
• Californian Honey & Salt
• Chinese Szechuan Pepper
• Bengali Spice
• Sold in 165g packs with a reseal tape
• Sales of £5.2m in first year
Massmarket premium appeal
Walkers extended its successful Sensations premium brand into nuts
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Tesco Finest Restaurant Collection,
UK Lidl Deluxe, Spain
Premium private label snacks are
found at a variety of price points
The focus is on accessible,
affordable treats, often using artisanal
cues
Hand Cooked Chicken & Tarragon Crisps made with
selected potatoes from Cornwall & Hampshire
Chilli Flavoured Home-Made Potato Crisps, €0.99
for 125g
Private label still strong in premium snacks
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Pata Patatine Da Vinci Chips, Italy
Aldi Pirato Boer‘n Chips, Netherlands
Most brands using provenance as a
“story” are artisanal, specialist
brands…
But 34% of UK consumers state British-origin as a key factor when choosing food
products
Artisan product using Italian potatoes & extra
virgin olive oil + Himalayan pink salt
Made with 100% Dutch potatoes and Equisun
sunflower oil
Provenance is a key route to premium
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Provenance makes the everyday more premium
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Casino Tous Les Jours Snacks, France
Edeka Gut & Günstig Chips, Germany
Messages such as “everyday” and
“essentials” reinforce a more positive message
Private label offers “value with values”
Private label “everyday” snack, 125g at €0.61
Crinkle cut chips baked with pure sunflower oil,
175g at €0.89
Value positioning moves beyond simply low price
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Borges flavoured nuts, Spain
Lay’s crisps, Spain
Resealable packaging is much more common in nuts than in other
snacks
Relatively few feature a zip
closure, most are just a reseal label
90g pouch pack with zip reseal closure
300g resealable “savings” pack
Resealable packaging and value positioning
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Attitudes towards crisps, nuts and other salty snacks, February 2013
Consumers in the more recession-hit markets show greater interest in snacks in resealable packaging – an issue of convenience? Or
value and food waste?
Resealable packs: convenience or value?
69
48
63
71
0
10
20
30
40
50
60
70
80
France % Germany % Italy % Spain %
I would be more likely to buy crisps/salty snacks in re-sealable packaging
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Key challenges facing the snacks industry:
• Older consumers are fast becoming the most coveted
demographic
• By 2015, Europe will have twice as many 55-74 year olds as
15-24 year olds
• Their needs may be different, but an inclusive approach can
work
The impact of changing demographics
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Focus on a “clean” label, identify and explain ingredients
Tell the story of provenance and the production process, from field to pack
Baked not fried and use of lighter oils for familiar product forms
Natural ingredients
Low fat content
Quality of ingredients
Key attributes sought by older consumers
In Europe consumers aged 45+ are significantly more motivated by:
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Kraft Foods’ Planters NUT-rition Men's
Health
Kellogg’s Special K Cracker Chips
Major players in the USA develop
products that have attributes
appropriate to the health concerns of
seniors: heart health, low sodium,
low cholesterol…
Mixed nuts, low sodium, natural source of vitamin E which may reduce risk
of heart disease
Baked, reduced calorie snack chips with sea salt
Appealing to seniors: USA
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Bourbon Calbee
Imaginative products in Japan
target health-conscious older
women via subtle health cues as well
as flavours and ingredients that will
appeal
Potato chips with 20% content from five
vegetables, added fibre and calcium
Wheat snack with crispy baby sardines, naturally
rich in calcium and reduced oil content
Targeting seniors: Japan
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For the consumer, it will (still) be about taste, not health
Moves towards healthy positioning will be covert, not overt
Natural will remain a key factor, focusing on the positives of what is in a product, not the negatives of what is not
Provenance will become a mainstream issue, building particularly on “local” for emotional, economic and environmental reasons
Taste over all
Provenance
Points for the future
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Consumers are conservative and want familiar flavours, but there is significant opportunity for variety among experimental & experiential consumers
Value will be key, but value at both the premium and economy ends of the market
Consumers look for value with values
The familiar and the less
so…
Value with values
Points for the future
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© 2013 Mintel Group Ltd. All Rights Reserved. Confidential to Mintel
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DAVID JAGO
Director of Innovation and Insight
+44 20 7606 4533