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Australian families reveal seven changes to food buying habits...
Consumer cut backs on discretionary spending have been well documented over the past year, but how has the economic downturn affected the simple Australian family dinner?
New research from leading parenting site www.kidspot.com.au, together with www.bestrecipes.com.au and www.birth.com.au, has revealed insights into the changes made in food preparation, takeaway purchases and dining habits due to the economic conditions.
The recent survey of over 5,000 Australian families across the 3 female-skewed websites found 97 per cent consider it important to sit down together as a family to eat their nightly meal. The economic turbulence has had an impact on the family dinner, however, with 46% of respondents now eating more home cooked meals now than a year ago, with the primary reasons being to either save money (65%) or to ensure they eat healthily (62%). Indeed, 90 per cent of families have a home cooked dinner 5+ nights per week.
According to the Kidspot survey, one third of Australian families have changed their dinner habits due to the economy.
“We need to generally save dollars any way we can,” one survey respondent explained. “Food is our biggest outlay so that is where we try to cut back. We use cheaper brands, only buy when certain things are on special, and eat out less.”
This trend was forecast by Nielsen in October last year and confirmed by their April 2009 consumer study, which found around two in five were cutting down on takeaway meals and buying cheaper grocery brands.
Kidspot’s research identified 7 key changes to food purchasing habits in response to the economic downturn:
1. More bulk buying and bulk cooking. The rise in grocery prices has led more respondents to bulk buy when things are on special and freeze for future use, especially meat. Bulk cooking has also come into vogue, allowing for more leftovers to be used for cost-efficient lunches.
2. Buying home brands over name brands. Home brands (private label) now have greater acceptance by consumers at the expense of brand names. Home brand products are most likely to be considered for every day staples like tinned tomatoes, flour, rice, butter and bread.
3. Cutting back on meat or buying lesser cuts of meat. Respondents reported replacing steak with lower cuts of lamb for stews and casseroles and limiting fish to once a week. As one respondent put it - their family is “eating more bulked foods like mince because it goes further and its cheap…I would rather be eating no red meat but it’s a lot cheaper than chicken and fish every night”.
4. Using vegetables as a money saving substitute to meat. For many families, the gap left by the cutback in meat has been replaced by more vegetarian meals throughout the week. Some reported buying cheaper cuts of meat yet increasing their vegetable and fruit intake, while others had completely substituted meat for vegetarian options.
5. Planning purchases to avoid impulse buys. It seems the economic downturn has taken the spontaneity out of mealtime with the household shopping trip becoming a carefully planned military operation. Mothers now leave the house for their weekly (not daily) shop armed with a list in hand, more likely gleaned from the catalogue-advertised specials, to purchase items that contribute to the family’s weekly menu plan. Organisation is key, with weekly bulk-cooking preventing families from eating expensive takeaway meals as a fall back option.
6. Greater price awareness and price comparison. Convenience may be the trade off for cost savings with survey respondents saying they compare prices across retail options to ensure they get the best deal possible. This can mean buying fruit and vegetables from markets, meat from independent butchers and other items from supermarket chains only when they’re on sale.
7. Eating less takeaway. Takeaway is now considered a splurge and an easy thing to cut back on to save. It’s become an expensive exercise to feed a family on takeaway, with most reporting that this has directly resulted in more home cooked and prepared meals. Nevertheless, although Australians are eating less takeaway, 61% of families still have takeaway at least every 2 weeks. This figure drops substantially to 41% of households with no dependants under 18 years of age living at home.
“I’m certain Australian grocery retailers and FMCG marketers have already seen these changes first hand in their market reports,” Kidspot CEO, Katie May, said. “Our findings have come from the hearts and minds of those leading the charge - the Australian mums. For some time now we’ve seen an ongoing conversation happening within our online community that revolves around the need to save money in an economic downturn.”
In general, Australians’ main meal is prepared at home, on the day (94% of respondents). Most people surveyed said that they use either all fresh or 75% fresh ingredients in the making of their evening meal (82%) and one quarter consult recipes weekly - with recipes sourced online 82% more often than in magazines.
“The modern Australian mum has had to reassess her purchase decisions of late and in many instances has drastically changed the way she has previously shopped for her family,” May concluded.
Source: www.ausfoodnews.com.au
Aldi splashes out for prime-time TV blitz...
AS COLES and Woolworths approach a ceasefire in their 72-hour battle at the bowser today, a third antagonist will fire a broadside on another front. Aldi, the relative newcomer to the highly concentrated grocery retail market, will begin a television advertising blitz today, breaking with an eight-year principle of keeping marketing costs modest.
Since entering the Australian market in 2001 the German chain has always said that its refusal to engage in costly electronic advertising campaigns was one of the prime reasons it was able to keep its grocery prices, on average, a third lower than its two big competitors. But yesterday the managing director of buying for Aldi's Australian operations, Matthew Barnes, said that since reaching a critical mass of 200 stores across the eastern seaboard in December, television had become a viable complement to its print and catalogue advertising.
Like the uniform Aldi store fit-outs, the weekly advertisements, which will screen in prime viewing hours on all three commercial free-to-air channels from tonight, are distinctly "no frills". An Aldi spokeswoman said that the new marketing strategy would not affect prices, and had been developed uninfluenced by the escalating marketing war between Coles and Woolies. Yesterday the Australian Competition and Consumer Commission said it would look into the two supermarkets' competing 40 cents a litre discount for every $300 spent on groceries offers, which both end at close of business today. However, on the surface, the three-day campaigns do not appear to flout any predatory pricing or other anti-competitive laws.
Aldi's spokeswoman said the company was confident consumers would see through the hype and realise the money they were saving on petrol could just as easily be saved by shopping at Aldi, where prices are between 25 and 40 per cent lower than in Woolworths and Coles. Yesterday a spokesman for Woolworths said its three-day petrol discount deal had had about the same effect on increasing traffic to its supermarkets as putting Coca-Cola on special. In response to fears that grocery prices would soar at both giant retailers to cover the massive loss from petrol revenue, he said the company's marketing budget was carrying all margin losses.
A spokesman for Coles said the company was v pleased with the results of the campaign but was unable to break down the figures at this stage.
Source: www.smh.com.au
Grocery prices under scrutiny again...
The release of price data from the Reserve Bank of Australia on Thursday has again put the major supermarket chains under the spotlight. The RBA’s research established that food, beverage and tobacco prices had risen 4% each year, on average, since 1993 - comfortably above the 2.7% core inflation recorded. “The various types of food included in the CPI show a broadly similar trend price increase over this period, although the prices for dairy, cereals and fruit and vegetable items have grown comparatively fast in recent years,” the central bank advised. “The recent strong price rises for these goods partly reflects the increase in raw food input prices - which have been affected by the poor conditions for agriculture in Australia and the rise in prices globally - though the raw input is only one part of the final retail price due to processing and distribution costs, and margins.”
Spokesman for consumer group Choice, Christopher Zinn, contends that the price rises can be linked to limited competition in the grocery sector. “This will come as no surprise to anyone who does the shopping. You really don’t have to be a Reserve Bank economist to know that fresh produce out of all the things that you buy in the grocery story have really been going up,” he told ABC radio over the weekend. “Really the one thing we can change in the short term is to look at how competitive this sector is and what can be done to inject more competition because that is the one thing that really is the consumer’s friend in this issue.”
Margy Osmond from the Australian National Retailers Association - which represents Coles, Woolworths and Franklins - disagrees, believing the recent activity in the sector bodes well for healthy competition. “If you’ve got companies like Costco and Aldi, Foodworks, all entering the marketplace, that doesn’t tell me it’s uncompetitive marketplace; that tells me it’s a very healthy marketplace and consumers are getting the benefits from it,” she said. “I think it’s easy to pick the big grocers sometimes as a target, and I think it’s completely unwarranted.”
Last year, the ACCC found the industry to be “workably competitive” and ACCC Chairman Graeme Samuel has been encouraged by the continued growth of rivals to Woolworths and Coles in the past year. He says the Grocery Inquiry carried out by the competition watchdog outlined that the bulk of price changes could be linked to higher raw food costs. “The RBA points out that an element of this has had to do with what they call raw food import prices; that is the somewhat poor conditions for agriculture in Australia,” he noted. “And of course we’re talking about that in terms of the drought and the rise in prices globally.”
Source: www.ausfoodnews.com.au
Nestlé Australia completes snack makeover...
A range of popular snack food products marketed to children - including iconic brands Milo and Peters Ice-creams - have been made healthier by Nestlé Australia with the reduction of sugar, fat and artifical colours.
After conducting a major review of its range, Nestlé Australia reformulated several products according to a new nutritional criteria - in line with the Australian Food and Grocery Council’s (AFGC) Responsible Children’s Marketing Initiative. Under the initiative, 16 leading food and beverage manufacturers have committed not to advertise to children, unless they promoted healthy dietary choices and a healthy lifestyle consistent with scientific standards.
AFGC Chief Executive Kate Carnell applauded Nestlé Australia’s commitment to reduce the amount of sugar and artificial colours in foods consumed by children.
“This is just one example of an Australian food manufacturer showing its commitment to providing healthy choices for people, including children, and highlights the success of the industry’s Responsible Children’s Marketing Initiative,” Ms Carnell suggested.
Some of Nestlé Australia’s products which have been reformulated to deliver improved nutrition include:
Allen’s lollies - 25 per cent reduced sugar in lollies
MILO B Smart - reduced fat and sugar and fortified with vitamins and minerals including, iodine, based on documented iodine deficiency in Australian school children
Uncle Tobys Roll-Ups - 40 per cent less sugar, made with real fruit and no artificial colours or flavours
Uncle Tobys Fruit Fix - made with 99 per cent fruit ingredients, provides one serve of fruit and has received a National Heart Foundation Tick
Peters Ice-creams - the MILO Scoop Shake (240ml) and the Billabong range (including Caramel, Chocolate and Strawberry flavours) have been reformulated so they contain no artificial colours
Uncle Tobys Muesli Bars - contain no artificial colours or flavours, a source of fibre and the goodness of wholegrains
Nesquik Plus - 25 per cent reduced sugar with no artificial colours and flavours.
“This initiative has helped ensure that Nestlé Australia’s products aimed at children are far more nutritionally sound as the products are required to meet our nutritional criteria,”Nestlé Australia Director of Corporate and External Relations, Peter Kelly, advised.
Source: www.ausfoodnews.com.au
Supermarkets to lead charge to recovery...
Supermarkets, banks and airlines are the advertising categories that will lead the charge to an ad market recovery, according to a new report from IbisWorld. Supermarkets like Coles and Woolworths will lead the way in the ad recovery Ibis claimed, predicting the sector will increase its ad budgets by 13.8% over 2009/2010.
According to the report “the relatively recession proof grocery and supermarket sector are buoying the advertising industry somewhat, as people eating out less translates into more entertaining and eating at home”. In banking and finance, revenue is down 4.5% and this has resulted in “trimmed marketing budgets” last financial year, with spend to hit $966m over the next financial year, an increase of 5.7%.
Airlines will see only steady growth in ad spend as Virgin and Qantas take each other on with prices, rather than ads. Ibis- World general manager Robert Bryant said: “In the current climate both carriers have chosen to engage in heavy discounting strategies to attract customers rather than costly advertising campaigns, resulting in relatively slow forecast growth in advertising spend of 3.8% this fiscal year.”
Other categories will decrease adspend over the next financial year, with the biggest dropper the auto industry, down 7.4% with a projected spend of $997.5m. The private education market will be down 3.8%, the soft drinks market down 3.3% and real estate agents spend down 2.6%. This slump in automotive and real estate, as well as fewer job vacancies, will negatively impact classified advertising, Ibis predicts, but there will be a move to digital advertising, public relations strategies and social media campaigns.
Bryant also forecast a return to “retro” ads to save on production costs and to evoke a sense of nostalgia. “Only time will tell whether we’ll see a full-scale revival of vintage favourites such as the all-conquering 1980s Solo Man, Colgate toothpaste ads with the chalk-breaking demonstration or the Meadow Lea Mum who ought to be congratulated.”
Source: BandT
IGA & Metcash sign landmark agreement as growth plans gather pace...
The representative of over 1,270 independent IGA retailers has announced a new deal with their leading supplier, Metcash, to share the proceeds of growth and major expansion projects.
The IGA National Council announced the deal today, with Metcash - the owner of the IGA brand - to share equally in the $10‐20 million worth of expected annual improvements in profits to be generated through the expansion of the IGA chain, refurbishments of stores, brand compliance, and improvements in stores’ “teamwork” over the next three years. The new agreement, to be back dated to May 1, 2009, was struck following negotiations between Metcash and IGA at the IGA National Conference and Expo in Surfer’s Paradise this week, attended by more than 5,000 store owners and staff, as well as suppliers to the IGA network.
“This is a historic deal for independent supermarkets in Australia, where we will share the proceeds of IGA’s continued expansion across Australia with our supplier for the first time,” National Board Chairman of IGA, Mick Daly, said. “We are delighted that Metcash has confirmed its position as the champion of the independent retailer by striking this historic agreement with IGA, whose network we continue to expand despite competition from the national chains.”
The deal is one of the outcomes of the two year, multi‐million dollar ‘Project Lion’, which involved IGA and Metcash identifying and generating greater operational efficiencies, technology upgrades, brand compliance and store standards, as well as the creating growth targets. As a result of the Project, IGA will introduce more than 225 new stores by 2012, with 43 opened last financial year and a further 60 new openings expected in 2009‐2010. Chief Executive of Metcash, Mr Andrew Reitzer, said the store openings would be supplemented with a cost cutting program designed to improve efficiency.
“We have also targeted $110 million in savings over the period that can be generated through greater operational efficiencies in stores and within our distribution system,” he advised. “We are working very closely with our retailers to achieve aggressive growth targets during tough times and believe our interests are perfectly aligned with IGA owners, who should share the rewards of our market‐leading supply system.” Mr Reitzer is hopeful the new scheme will encourage other independent retailers to join the IGA banner.
Source: www.ausfoodnews.com.au
Coles switches focus to seniors...
Coles has continued with their aggressive discounting plan, offering a 10 per cent rollback to seniors this week. The supermarket chain last week instigated a brief petrol price battle with a 40 cents per litre discount for those who spent more than $300 on groceries, with Woolworths immediately following suit.
Woolworths will not match the deal, due to end tomorrow, on this occasion. Coles spokesman Jim Cooper said the move was made as many Pensioners missed out last week because their shopping needs ensured they could not capitalise on the deal. Spokeswoman for Woolworths, Clare Buchanan, told the Herald Sun the discount was “a very expensive stunt for a business that is clearly struggling”.
The move by Coles means they have covered most broad demographics in their campaigns this year. Last week’s deal was targeted at families based on the high spend needed to make use of the offer and followed their Feed Your Family for Under $10 campaign. They have also focussed on the female customer with the “You Shouldn’t be Taxed for Being a Woman” promotion and, of course, the seniors market today.
Source: www.ausfoodnews.com.au
Supermarkets to lift ad budgets...
Supermarkets are likely to buoy the advertising industry in the year ahead, according to a new industry report released yesterday. Advertising from supermarkets in Australia is expected to soar a further 13.8% in the 2009/10 financial year to $774 million amid a stagnant advertising market, according to IBISWorld.
”The relatively recession-proof grocery and supermarket sector are buoying the advertising industry somewhat, as people eating out less translates into more entertaining and eating at home,” the report advised.
Australian supermarkets have been prominent in the advertising domain over the past year, increasing expenditure by just under 15 per cent. And IBISWorld expects that to continue as the likes of Aldi, Coles, Woolworths, Franklins, Foodworks and IGA all outline plans for store growth.
IBISWorld anticipates the back to basics approach will remain the hallmark of supermarket promotions in the short-term.
Source: www.ausfoodnews.com.au
Costco confirms opening date: AUS...
Costco has confirmed it will open its first Australian store next month on August 17. Located at Waterfront City, Melbourne Docklands, the 14,000 square metre store has been built on a greenfields city close to the Melbourne central business district in the past 12 months.
The retailer is continuing to look for a site in Sydney and has been examining other potential locations for future stores in Melbourne and Brisbane but has yet to confirm a second store.
The international retailer operates as a membership store with customers paying up to $60 a year to shop the store.
Costco has started a recruitment campaign for memberships as part of a launch program for the Docklands store. More than 1000 memberships have already been sold to consumers.
Patrick Noone, the Australian MD for the US based retailer, said Costco provides its members with exclusive access to quality brand-name merchandise at substantially lower prices than typically found at conventional wholesale or retail stores.
Noone said the store will carry thousands of brand-name products across retail categories that include groceries, confectionary, appliances, television and media, automotive supplies, tyres, toys, hardware, sporting goods, jewellery, watches, cameras, books, housewares, apparel, health and beauty aids, tobacco, furniture, office supplies and office equipment.
Noone said the Costco Docklands store will also feature a variety of convenient specialty departments including a fresh bakery, fresh meat, fresh produce, deli, optical department, one-hour photo, tyre centre and food court. Costco has recruited 230 full and part-time employees and Noone said the new team members receive highly competitive remuneration and benefits with potential for great career growth as the company continues to expand its operations in Australia.
Costco has 58 million cardholders at more than 550 locations throughout the United States, Canada, Mexico, England, Scotland, South Korea, Taiwan and Japan.
Source: www.foodweek.com.au
Aldi, Subway among Retailer of the Year finalists...
The Australian Retailers Association (ARA) has today announced the category winners for the industry’s top honour - Australian Retailer of the Year. Discount grocer Aldi, which has made rapid strides forward over the past year, claimed the food, drink and grocery category, while sandwich franchise Subway took out the restaurants, cafés and takeaway category. The two food industry representatives will vie for the national award with Country Road (clothing and footwear) and L’Occitane (specialty retailing).
“This year the Australian Retailers Association (ARA) invited retailers across the country to vote for the Australian Retailer of the Year across a range of categories,” ARA Executive Director Russell Zimmerman advised. “With the votes now tallied, Aldi, Country Road, Subway and L’Occitane have been awarded category titles by their industry peers and will go head-to-head to have the crown handed down from reigning Australian Retailer of the Year Supercheap Auto.”
“After over 12 months of reduced consumer demand and falling retail sales, the Australian Retailer of the Year judges will be looking for outstanding performances and displays of ingenuity, innovation and business nous during an extremely difficult trading period.”
The Australian Retailer of Year will be announced at the National Retail Forum in Melbourne on 11 August 2009.
Source: www.ausfoodnews.com.au
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Australian
News:
Supermarket giants checked out...
CONSUMER hostility towards the powerful supermarket duopoly of Woolworths and Coles is palpable and growing, according to a series of focus groups conducted by social marketers.
In contrast, alternative retailers such as Aldi are growing rapidly in popularity, and the imminent arrival of another competitor, Costco, is being eagerly anticipated, the group's research conducted in Sydney and Adelaide with mothers aged 30 to 45 found. Local growers' markets were also becoming increasingly popular, the research found. Consumers perceived that Coles and Woolworths wielded too much power in the marketplace, but for those not living close to an alternative, there was little choice, said Neer Korn, the director of Heartbeat Trends, which conducted the focus groups before the Federal Government pulled the plug on the price comparison website, Grocery Choice.
The groups also admitted to feeling more readily irritated or angry at Coles or Woolies if something little went wrong, like a long queue or an unavailable product. They also believed the duopoly was more likely to try to pull the wool over consumers' eyes, which they resented. "We tend not to focus on the negatives but there is no love lost there," said Mr Korn, whose clients include Coles Myer. "Consumers were more than happy to offer their views on Coles and Woolworths, and not in kind terms."
Aldi's growing popularity appeared to be based on a broader base than just cheaper prices. Aldi products were perceived to be carefully sourced and of high quality by the focus groups, service was perceived to be superior and consumers enjoyed the surprise factor of Aldi's stream of one-off non-grocery items such as electronics and toys at sale prices. Although most mothers surveyed said they were not yet personally hurting from the recession, they were nevertheless looking for better value, bulk-buying opportunities and discount stores.
"They had a strong sense that what they didn't want was the feeling of 'being had', and they were prepared to drive the extra distance if it made them smart shoppers," said Mr Korn. Consumers were also fed up with being brazenly ripped off, yet being told it was for their own good, he said, with Mars singled out over the trend among manufacturers of offering smaller "portion controlled" packaging on the pretext of fighting obesity, yet failing to reduce the product's price.
The move towards unit pricing, which becomes compulsory for all large grocery retailers in December, was seen as highly positive by the mothers and a way of fighting back against the trend. Woolworths said yesterday it was unable to respond at short notice and without having seen the survey's results.
A spokeswoman instead referred to a survey conducted by the Herald in March, which found that out of 10 household corporate brands, consumers perceived Woolworths to have the best reputation for corporate citizenship. Coles came second. The Coles spokesman said Heartbeat Trends results did not correspond with a recent Roy Morgan satisfaction survey and its own customer satisfaction tracking, "both of which show Coles satisfaction levels having risen over the last six months".
Source: www.smh.com.au
Garrett throws support behind bottled water ban...
The bottled water industry is expected to come under heightened scrutiny following the decision by the NSW Government to place a ban on all agencies and departments buying bottled water. And Federal Environment Minister, Peter Garrett, has shown support for the move.
Mr Garrett told ABC radio today that other states should consider following the lead of New South Wales. “I think it’s worth looking at,” he said. “Quite clearly we’re having a really important, pretty healthy debate about the value of bottled water.” “It’s up to individual state governments to decide what positions they want to take, but I think Nathan (Rees) has done the right thing.” Adding to pressure on the $500 million industry, the Southern Highlands town of Bundanoon placed a ban on bottled water - the first Australian town to do so.
Industry response
Australia’s leading organisation representing food and grocery manufacturers, the Australian Food and Grocery Council (AFGC) warned today that the move could have the unintended consequence of promoting unhealthy beverage choices. AFGC Chief Executive Kate Carnell said the decision was incredibly short-sighted, especially considering the current debate about obesity in Australia.
“From a government which has touted rising rates of obesity as the number one health risk facing Australians, their decision seems ludicrous,” Ms Carnell said. “Moves to ban bottled water by government beggars belief and clearly sends the wrong heath message.” “Bottled water provides a healthy choice for consumers when they are in the office, away from home or exercising and people buy it for convenience.”
Growth under threat
The bottled water sector has faced difficulties in Europe and the US over the past year as consumers turn to the tap to cut costs amidst continued campaigns against the product by environmental groups. The consistent double-digit growth from 2000-2008 appears a long time ago for many manufacturers, with market analysts anticipating almost all the growth for the sector in the coming five years to come from Asia. Australian sales growth is now expected to be in the low single digits for the foreseeable future.
Source: www.ausfoodnews.com.au
Julie claims MasterChef crown...
The hit that few people saw coming has soared to an Australian ratings record, putting special events like the AFL Grand Final and Australian Idol finales well and truly in the shade.
Over 3.7 million tuned in last night as MasterChef Australia delivered the highest rating non-sport telecast since ratings began, with only the Hewitt-Safin Australian Open Final and 2003 Rugby World Cup Final surpassing it this century. What was so spectacular about its success was its ability to capture the imagination of such a broad range of demographics, making Channel Ten cry with delight while the other networks cringed with envy.
For those who missed last night’s finale, mother-of-three Julie Goodwin edged out Adelaide artist Poh Ling Yeow in all three challenges. The final task, the creation Aria’s Chocolate Tart - one of Matt Moran’s signature dishes, showed just how far the two had come in front of a judging panel that included Curtis Stone as well as regulars George Calombaris, Gary Mehigan and Matt Preston. Prior to the final challenge, Julie and Poh had both erroneously said that port was in Gary’s bourguignon, while Julie used a number of techniques learnt from the likes of Adrian Richardson and Donovan Cook to surpass the score of Poh in the invention test.
Beyond the success for both Julie and Channel Ten, there are a number of other winners from the phenomenonal performance of the show, according to Corporate Brand Developers Managing Partner Susie Cole. “MasterChef has helped many people rediscover their love of food and will bring greater experimentation to kitchen,” she told Australian Food News. “This is likely to see a surge in demand for a range of grocery products that have often been neglected by the average Australian.”
Such products that could get a ‘leg up’ include a range of herbs and spices from dill to sage and thyme, and cheaper cuts of meat - as people replicate the style of early favourite Chris Badenoch. Restaurants could also receive a boost as people become more excited about high quality food. The restaurants of the renowned chefs that have appeared on the show, in particular, can expect to gain out of their participation with an increased flow of customers. Importantly for the restaurant industry, the show could also help cure the skills shortage that has been threatening the sector for years.
“Expect the number of contestants to soar next year as more Australians dare to dream of becoming a leading chef,” Susie advised. “With more young people considering the prospect of cooking for a living, the hospitality sector can expect a new wave of budding chefs signing up for apprenticeships and at cooking schools as working in a commercial kitchen takes on a more glamorous cache than the long houred drudgery of old.”
Source: www.ausfoodnews.com.au
Preventative Health Taskforce recommends sport ad alcohol ban: report...
A proposal to ban alcohol advertising in sport has been put forward by the Federal Government’s Preventative Health Taskforce, according to newspaper reports. The Taskforce, set up to offer a guide to the future health strategy of the nation, handed their report to the government at the end of last month - although it has yet to be publicly released. Reports from News Limited suggest that it highlights a need to rid sport of alcohol advertising in a bid to tackle binge drinking.
The issue of alcohol advertising has been on the public agenda for a number of years, with the debate intensifying recently thanks to heightened concern about binge drinking. Sporting codes argue that such a move would cost $300 million and particularly hurt grassroots clubs, while health groups contend the link between sport and alcohol is damaging.
Family First Senator Steve Fielding put the proposal before Parliament last year as an adjunct to the alcopops tax but it was knocked back. He believes the government must now act if the Taskforce has recommended such a move. “Up until now the Rudd Government has been hiding behind the alcopops tax. It is a blatant tax grab,” he told the ABC. “It would do very little to address binge drinking and the Government does have to put these tighter restrictions in place. They need to set a date for this to happen.” Independent Senator Nick Xenophon also supports the ad ban and is suggesting the Government consider implementing a three-five year phase out. AFL Chief Executive Andrew Demetriou has reported his code’s disapproval, however, believing it to be over-the-top.
“Our broadcasters rely on advertising of all sorts including alcohol but we are involved in responsible alcohol drinking policies, educating all people in our industry and that is the best way to go about it,” he said. “Banning everything is not going to solve the world.” The Brewers Association, which represents the leading beer makers, has also criticised the recommendation. “You know there was a Senate inquiry into it only last year and there wasn’t any general groundswell then for this,” CEO Stephen Swift said. “I think the Australian consumers are very well aware about alcohol and its properties and its benefits when it is consumed in moderation and its risks when it is not.”
The Federal Government has not divulged their likely response to the recommendation, instead simply advising that the report will be released soon with all options to be considered. The Coalition is expected to oppose such a move, with the Greens in favour.
Source: www.ausfoodnews.com.au
Restaurant industry delighted by MasterChef success...
Restaurant & Catering Australia, the peak national organisation representing the interests of 40,000 restaurateurs and caterers, has been buoyed by the stunning ratings performance of MasterChef Australia.
John Hart, Chief Executive Officer of the industry body, believes the public groundswell of support for the show will provide a fillip for the restaurant sector. “The Association is delighted with the overwhelming enthusiasm for the industry generated by MasterChef,” he said. “Fremantle Media and Channel Ten have done a marvelous job conveying the hard work, dedication and commitment you need to succeed in the industry. In addition, the passion demonstrated by the contestants and the professional chefs and judges (including Matt Preston, Savour Australia R&CA Awards for Excellence Chair of Judges) is to be commended.”
“MasterChef highlighted the career opportunities available in the restaurant and catering industry,” Mr Hart added. “Renewed interest in the industry will no doubt help alleviate some of the skills and labour shortages that the industry is currently experiencing in the areas of cooks, chefs and managers.”
The skills and labour shortage experienced in Accommodation, Cafes & Restaurants is severe with a Workplace Survey undertaken by Restaurant & Catering Australia in January 2007 indicating that businesses were found to be 6.8% underemployed. Current research indicates that this situation has not greatly changed regardless of the economic situation, the industry body advised.
Source: www.ausfoodnews.com.au
Woolworths announces record sales figures...
Woolworths Limited, Australia’s largest supermarket operator, has reported a 7.5% surge in full year sales to $49.6 billion. Chief Executive Officer, Michael Luscombe, said their results highlighted the resilience of the Australian economy. “Despite the global economic turmoil, 2009 has been a successful year with solid results across our business overall,” he said. “Continued solid sales growth in food retailing and especially in discretionary areas like apparel, consumer electronics and homewares, highlights the underlying strength of the Australian economy in these times.” Woolworths credited reinvestment in their businesses as a key to the strong figures, with Australian food and liquor and Big W again leading the way.
Australian Food and Liquor
Australian Food and Liquor sales for the year rose 9.6% to $32.8 billion, comfortably above the rate of inflation (4.1%). On a comparable store sales basis, the company saw sales rise 7.4% - slightly above last year’s sales growth of 6.3%, although inflation had risen from 2.9%. Comparable sales for the fourth quarter were 7.9%.
“This is another solid performance demonstrating the degree to which customers in this current economic climate have embraced our key strategic initiatives such as price reinvestment, the 2010c store format, and our Everyday Rewards program,” Greg Foran, Director of Food, Liquor and Petrol, suggested.
The retailer opened 28 new Australian supermarkets during the year, ahead of their targeted range of 15 to 25. They now operate 802 supermarket outlets. Mr Luscombe linked sales growth in their food division to a trend toward home dining. “What we have seen in the last three-quarters to a year has been that generally there’s been a upsurge in cooking at home by the relative sales of food and food ingredients and cooking ingredients,” he reported.
Costco “will do well”
Mr Luscombe was complimentary to pending new entry to the Australian retail environment Costco, although he believes they won’t threaten the surging profit at his company.
“They are really good retailers and they will do well,” he told Bloomberg in an interview. “We think we measure up pretty well against what Costco has to offer.”
Source: www.ausfoodnews.com.au
Spending down, consumers loyal...
The economic climate is continuing to reduce consumer spending, according to new research, but in good news for brand owners less than a third of consumers are switching to cheaper brand and stores’ own brands.
The new research from Millward Brown claims that 67% of Australian consumers are being more careful or actively reducing their spending. While men were most likely to simply buy less (53% of men versus 37% of women), women preferred to buy the same brands but wait for price promotions before making a purchase (52% of women versus 35% of men). However, less than a third of consumers reported switching to cheaper brands and stores’ own brands.
The global financial crisis has impacted the majority of households, regardless of income level, Millward Brown reports, with 71% of low income earners, 61% of middle income earners, and 57% of high income earners saying they are being more careful or reducing spending. Ben Dixon, managing director of Millward Brown Australia, said: “As this survey has shown, when economic conditions necessitate changes in spending behaviour, many consumers would rather wait until their favourite brand is on special than switch brands, illustrating the power of strong brands.”
Dixon said such evidence means brands should strive for great creative ideas that will shine through even in a period of low media spend. He cited Meat and Livestock Australia’s Sam Kekovich ads by BMF as an example of such creative. “When marketing budgets are under pressure, there is even more impetus to ensure the creative within campaigns works harder to effectively compensate for reduced media spend.”
Source: BandT
Food prices decline in June quarter...
The price of food fell by 0.9% in the June quarter but still maintained a lofty 4.8% rate of inflation for the year to June. The food group fell in all capital cities and offset rises in most other categories measured by the ABS.
The major catalysts for decline were vegetables (-6.9%) and fruit (-7.6%), both of which benefited from peak growing seasons and favourable weather patterns. Removal of a tax on milk and a weakened dairy environment contributed to a 3.0% fall in milk prices. Partially off-setting price falls were take away and fast foods (+1.1%) and restaurant meals (+0.8%).
Over the twelve months to June quarter 2009, twenty three of the twenty six food categories rose to ensure a 4.8% rise across the food group. Increases occurred in all capital cities and were mainly driven by general price rises in take away and fast foods (+5.7%), restaurant meals (+4.1%) and fruit - which still rose 7.7% for the year despite the substantial fall in prices this quarter.
Food commodity prices indicate further price declines ahead
The Westpac-NFF Commodity Index this week showed a 12.7% decline in the price of key food commodities, signalling that lower prices could be seen for a few more months to come given the time lag between lower commodity prices and lower grocery prices. The National Farmers Federation believes the lower prices are unlikely to last, however, as trends seen before the financial markets crashed begin to return.
Source: www.ausfoodnews.com.au
Back to Basics for advertisers...
SUPERMARKETS, one of advertising world's stalwarts, are expected to prop up the industry in the coming year, as the downturn pushes companies and consumers back to basics and hastens the industry's move online.
Advertising from supermarkets grew an estimated 14.7 per cent to $680 million in 2008-09 financial year and are set to expand by 13.8 per cent to $774 million next year, according to IBISWorld. ''The relatively recession-proof grocery and supermarket sector are buoying the advertising industry somewhat, as people eating out less translates into more entertaining and eating at home,'' the industry analysis group said in a report released today.
IBISWorld general manager Robert Bryant said it is likely advertisers will go back to basics into 2010, with companies ''emphasising value'' to core customers. Mr Bryant said there is a ''distinct dive in campaigns promoting luxury brands and big ticket items,'' reflecting the shrinking employment options for Australians, which in turn drag down household income. The jobless rate, currently at 5.8 per cent, is expected to climb steadily to 8 per cent by the end of next year, as the full effect of the global downturn weighs on Australia's economy.
Advertising for takeaway food is expected to slow its decline next year, helped by consumers trading down from full service restaurants as their incomes wither, Mr Bryant said. Ad revenue for the fast food industry is estimated to ease down 4.4 per cent to $3.37 billion in 2008-09, then dip a mere 0.8 per cent to $3.34 billion in 2009-10, according to IBISWorld data.
Downturn response
"We're now in a situation where sales people and marketing managers and executives have to do much more with much less,'' said IBISWorld senior analyst Raghu Rajakumar. "The pressure is there and people are being asked to stretch their marketing dollars as much as possible but their resources and the ability to spend compared to this time last year is greatly hampered.''
Advertisers facing this squeeze generally either hunker down and try to ride it out, overreact and slash their marketing budget drastically, or try to refine their efforts by targeting potential customers, said Mr Rajakumar. But online advertising was expected to grow. Mr Rajakumar said online advertising was seen as a low-cost alternative that would will rise in use over next five to ten years, helped by Generation Y's entry into the workforce. "Every couple of years there is a major change in the online landscape,'' Mr Rajakumar said, referring to the rise of email, followed by social networking sites like MySpace and Facebook, and now Twitter.
Online advertising made up 12.4 per cent of the total market in the 2008-09 year, according to IBISWorld and will widen to 14.3 per cent in 2009-10. The compares to newspaper and TV advertising both remaining essentially flat at about 29 per cent each over the same period, while magazine, radio, outdoor and other non-main media formats will decline slightly from 28.6 per cent in 2008-09 to 27.8 per cent in 2009-10.
Cars crash
With one job for every five job seekers currently available in the ad industry, the downturn will force agencies to become more creative about how they cater to clients, IBISWorld said. Not surprisingly given the impact of the global financial crisis on spending, the auto industry is tipped to experience the biggest drop in advertising, falling 13.1 per cent $1076.79 in the 2008-09 year, on IBISWorld's numbers.
The fall is expected to slow but continue into the next financial year with ads from the industry sagging 7.4 per cent to $997.5 million. One area of strength this year has been Holden's ability to take advantage of the Federal Government's small business tax incentive to drive sales. ''This tactic not only benefited Holden sales, but also drove demand for other brands, with sales of utes, vans and light trucks rising by 26.9 per cent in June 2009 compared to June 2008, and leaping significantly from sales recorded in May 2009,'' Mr Bryant said.
Source: www.smh.com.au
Global
News:
'Alice' aims to change household shopping habits...
CHICAGO (Reuters) - A new website wants consumers to browse virtual shelves of everything from diapers to shampoo, a move that if successful would mark a major shift in the way most Americans buy household products. The sector faces hurdles heading online since products such as toilet paper are ones people often need in a hurry and many items are bulky or heavy, which means high shipping costs for items with relatively low price tags. Also, consumers buy items from several different manufacturers, so selling directly from company websites would be inconvenient.
But founders Brian Wiegand and Mark McGuire said their site, Alice.com, could help manufacturers maintain their brand identity as they battle to retain thrifty consumers who are buying more store-branded goods from retailers such as Target Corp and Wal-Mart Stores Inc. The categories manufacturers are in, the value they can offer in this economy and how they are already selling their products at stores are issues companies are considering when thinking about whether to sell through more online channels, said Herb Walter, Consumer Packaged-Goods and Retail Advisory Partner of PricewaterhouseCoopers' Retail & Consumer practice. "It is a viable option, it is one that is being experimented with," said Walter. "At least for the foreseeable future it's got to have a value label next to it."
With Alice.com, manufacturers get to set their own prices and receive all of that revenue. The site makes money by giving the companies spending data, advertising space and distributing samples for them to targeted customers. Manufacturers pay the site to handle logistics including free shipping on all orders, which must have at least six items. Wiegand said Alice.com aims to capture 250,000 customers in the first year. This is the fourth partnership for Wiegand and McGuire, who most recently sold Jellyfish.com to Microsoft Corp in 2007. Jellyfish.com was rebranded as Bing cashback, a service consumers can use to save money when they shop online.
The duo compared Alice.com to Netflix Inc since the new site will remind shoppers to reorder, much like Netflix sends the next DVD in a customer's queue. And working off the popularity of networking sites such as Facebook and MySpace, customers can review products and tell others what they buy.
GO ASK ALICE
The name is in one way a nod to the housekeeper Alice on the 1970s U.S. hit television show "The Brady Bunch," and had the sound of a consumer-oriented brand, the founders said. Alice.com will compete with Drugstore.com, Diapers.com, Amazon.com Inc and others already selling many of the items it stocks. The site is launching with more than 6,000 products such as shampoo, soap, coffee and pet food. Alice.com aims to be different by acting as a platform for manufacturers to communicate directly with consumers.
Alice.com has commitments from five of the top 10 consumer products companies but would not disclose whether specific players such as Procter & Gamble Co and Unilever have signed up. "As long as most of the major manufacturers are going to get behind something like this, then we hope it's going to be a viable opportunity to sell more," said Mark McGreevy, director of national accounts for Durex Consumer Products.
Durex condoms are available on the site and through other online retailers, but like most other manufacturers, Durex does not sell directly to consumers. Test users said they were pleased with Alice.com's approach, which allows shoppers to compare prices quickly. "They're definitely tapping into something that I think could work but certainly it's going to take folks to change their way about how they buy products," said Kristen Chase, an Atlanta-based co-founder of CoolMomPicks.com. Chase and Erin Doland, editor-in-chief of Unclutterer.com, said they plan to use the service again. "Alice was better-priced then my grocery store on almost all of the products," said Doland, who lives in the Washington, D.C. area.
For now, Alice.com has only one distribution center, in Indiana, and does not send products to Alaska or Hawaii.
Source: www.reuters.com
Shoppers declare recession is over...
CONSUMERS have abandoned talk of recession as the International Monetary Fund has sharply revised up its forecasts, staking its reputation on a stronger than expected global recovery next year. Forecasts due to be released overnight are understood to push China's expected growth rate sharply higher both this year and next and endorse an earlier IMF decision to upgrade Australia's outlook.
It has given the United States only the barest upgrade and remains downbeat about Europe.
At home shoppers have effectively declared the "recession" over producing by far the biggest jump in consumer confidence in the 34-year history of the Westpac-Melbourne Institute measure. In the space of two months the index has soared 23 per cent to the point where optimists clearly outnumber pessimists in each of the forward-looking questions the institute asks.
There are 2 per cent more optimists than pessimists when asked about economic conditions over the next 12 months, 22 per cent more optimists when asked about conditions over the next five years, 24 per cent more optimists when asked whether it was a good time to buy a major household item and 17 per cent more optimists when asked about family finances in the year ahead. "Clearly we are dealing with much larger forces than the ones that typically drive confidence," said the Westpac chief economist, Bill Evans, who confessed that he was astounded by the results. "The stand-out force must be the huge financial hand-outs introduced to counter the global financial crisis."
In an extraordinary endorsement Mr Evans said the success of the Government's stimulus package in boosting confidence would be "a lesson to other governments including the US". "The key is not the direct impact of increasing spending capacity, those two big hand-outs only represent 2 per cent of GDP. The key is to restore confidence, and the Government's approach seems to have been more successful than either tax cuts or direct spending." The confidence index has jumped from 88 to 109 since the budget in May, where a level of 100 indicates that pessimists and optimists are evenly balanced.
The measure sees confidence higher than at any time since the very early days of the financial crisis in December 2007 and a full 38 per cent higher than a year ago. Importantly optimists outnumber pessimists in every income group, every occupational group, and in every category of home ownership. Only when it comes to voting intention is there a clear difference in confidence, with pessimists slightly outweighing optimists among Coalition voters with an index number of 99.2. The confidence measure among Labor voters exceeds 118.
Separately released figures show the number of new housing loans climbing a further 2.2 per cent in May to a 16-month high. First-home buyers accounted for a record 29 per cent of new home loans according to the Australian Bureau of Statistics.
Source: www.smh.com.au
Renewed zest for ethical and premium products...
British shoppers are starting to return to premium and ethical food ranges, the latest sales data from Tesco has revealed.The UK’s largest supermarket operator reported its Finest, Organics and Fairtrade ranges were all returning to growth, suggesting that the trends seen prior to the global recession are beginning to return.
The news flies in the face of a survey earlier this week suggesting that consumers are continuing to shun the most upmarket ranges, according to the retailer. Demand for Fairtrade produce has risen 15 per cent in the past year and their Finest range (the most upmarket of their private label goods) has recently reaped strong sales to turnaround a disappointing start to the year. Additionally, organic produce - which has seen growth rates fall from double digits in the past year - returned to the top of the shopping list with sales soaring 52 per cent since November.
“While it’s too early to say that we are seeing the green shoots of recovery from the recession rising demand for our ethical and premium food brands are offering optimistic signs,” Tesco pillar brands senior marketing manager, Stephanie Stewart, said. “While much has been made of us introducing our successful Discounter range last year we have not taken our eye off our other brands and ethical ranges and through improved offers we are now starting to see sales rise again.”
The most popular products within the ranges have been blueberries, mince and potatoes in the organics sector; meat in the premium sector; and bananas, cashews and coffee amongst Fairtrade products.
Source: www.ausfoodnews.com.au
Supermarket packaging debate heats up in UK...
The Local Government Association (LGA) should stop “carping” and start “collaborating” on reducing the amount of supermarket packaging going to landfill, the British Retail Consortium (BRC) told just-food overnight.The LGA on Saturday (11 July) called for the government to force UK supermarkets to reveal how much packaging they produce. The association said only M&S, Waitrose and Morrisons revealed details about how much packaging they produce, while Tesco, Asda, Sainsbury’s and Co-op all referred councils to WRAP.
Reacting to the calls, BRC environment director Jane Milne, said: “The LGA appears to be more interested in publicity than achieving real environmental progress. It would make a better contribution to reducing the amount of packaging going to landfill by meeting us to discuss how we can increase recycling. It should stop carping and start collaborating.” The consortium said that all publishing figures would do is “demonise” large retailers who use more packaging because they sell more products.
The LGA said it was calling on WRAP to publish, every three months, the amount of packaging each supermarket produces so that shoppers can compare and see which perform the best and worst at cutting back. A spokesperson for the environmental company said: “WRAP publishes packaging data for the grocery sector as a whole, which is measured against specific targets. This is under a voluntary commitment, the Courtauld Commitment, which has already met its first objective of stopping the long-term trend in packaging growth despite a growth in population and an increase in grocery sales.” Retail giant Asda said it is “frustrating” for the LGA to “keep pointing the figure of blame” rather than helping solve the problem.
“The cynical could be forgiven for thinking they simply want to gloss over the terrible inconsistencies that exist amongst local council recycling schemes. This post code lottery makes it nigh on impossible for national retailers to design packaging that can be disposed of everywhere - despite more than 90% of it being recyclable,” a spokesperson said.
Source: www.ausfoodnews.com.au
Walmart demands greater sustainability from suppliers, launches eco-ratings...
Walmart, the world’s largest retailer, has reported plans to develop a worldwide sustainable product index that will see an eco-rating placed on all grocery products sold at their stores.
The groundbreaking initiative, announced overnight during a meeting with 1,500 of its suppliers, associates and sustainability leaders, will establish a single source of data for evaluating the sustainability of products. “Customers want products that are more efficient, that last longer and perform better,” Mike Duke, Walmart’s president and CEO, noted. “And increasingly they want information about the entire lifecycle of a product so they can feel good about buying it. They want to know that the materials in the product are safe, that it was made well and that it was produced in a responsible way.”
Mr Duke said the company does not perceive the sustainability trend as one that will fade, with heightened consumer expectations “a permanent part of the future”. The company will introduce the initiative in three phases, beginning with a survey of all its suppliers around the world. The survey, which will go out to over 100,000 companies, includes 15 questions that will serve as a tool for Walmart’s suppliers to evaluate their own sustainability efforts. The questions will focus on four areas: energy and climate; material efficiency; natural resources, and people and community (see: below for details).
“The survey will include simple but powerful questions covering familiar territory, such as the location of our suppliers’ factories, along with new areas like water use and solid waste,” John Fleming, Chief Merchandising Officer, Walmart US, advised. “The questions aren’t complicated but we’ve never before systematically asked for this kind of information. The survey is a key first step toward establishing real transparency in our supply chain.” Fleming said the company will ask its top tier American suppliers to complete the survey by Oct. 1. Outside the United States, the company will develop timelines on a country-by-country basis for suppliers to complete the survey.
As a second step, the company is helping create a consortium of universities that will collaborate with suppliers, retailers, NGOs and government to develop a global database of information on the lifecycle of products — from raw materials to disposal. Walmart has provided the initial funding for the Sustainability Index Consortium, and invited all retailers and suppliers to contribute. The company will also partner with one or more leading technology companies to create an open platform that will power the index.
“It is not our goal to create or own this index,” Mr Duke stated. “We want to spur the development of a common database that will allow the consortium to collect and analyze the knowledge of the global supply chain. We think this shared database will generate opportunities to be more innovative and to improve the sustainability of products and processes.”
The final step in developing the index will be to translate the product information into a simple rating for consumers about the sustainability of products. The questions…
Energy and Climate: Reducing Energy Costs and Greenhouse Gas Emissions
1. Have you measured your corporate greenhouse gas emissions?
2. Have you opted to report your greenhouse gas emissions to the Carbon Disclosure Project (CDP)?
3. What is your total annual greenhouse gas emissions reported in the most recent year measured?
4. Have you set publicly available greenhouse gas reduction targets? If yes, what are those targets?
Material Efficiency: Reducing Waste and Enhancing Quality
1. If measured, please report the total amount of solid waste generated from the facilities that produce your product(s) for Walmart for the most recent year measured.
2. Have you set publicly available solid waste reduction targets? If yes, what are those targets?
3. If measured, please report total water use from facilities that produce your product(s) for Walmart for the most recent year measured.
4. Have you set publicly available water use reduction targets? If yes, what are those targets?
Natural Resources: Producing High Quality, Responsibly Sourced Raw Materials
1. Have you established publicly available sustainability purchasing guidelines for your direct suppliers that address issues such as environmental compliance, employment practices and product/ingredient safety?
2. Have you obtained 3rd party certifications for any of the products that you sell to Walmart?
People and Community: Ensuring Responsible and Ethical Production
1. Do you know the location of 100 percent of the facilities that produce your product(s)?
2. Before beginning a business relationship with a manufacturing facility, do you evaluate the quality of, and capacity for, production?
3. Do you have a process for managing social compliance at the manufacturing level?
4. Do you work with your supply base to resolve issues found during social compliance evaluations and also document specific corrections and improvements?
5. Do you invest in community development activities in the markets you source from and/or operate within?
Source: www.ausfoodnews.com.au
UK supermarkets halve plastic bags use in just two and a half years...
Leading British supermarkets and their customers have effectively halved the number of carrier bags handed out since 2006. Having achieved a cut in bag numbers of 26 per cent by the end of 2008 (compared with 2006 figures), supermarket customers have made incredible progress and extended this to a 48 per cent reduction in England in just a further five months. Comparing May 2006 to May 2009, 346 million fewer bags were used by customers in that one month alone.
The new figures, announced today by the British Retail Consortium (BRC) have been compiled from the seven participating retailers by WRAP (Waste & Resources Action Programme). At the end of 2008, seven BRC supermarket members voluntarily pledged to reduce the number of single-use carrier bags used by customers by 50 per cent by the end of May 2009, compared with May 2006.
The dramatic reduction has been achieved by retailers using specific schemes they feel work best for their customers - backed by a consumer campaign funded by the government. While it has been a challenging exercise - involving staff training and customer communication - retailers and the Government have helped to change consumer behaviour by taking customers with them, according to the BRC.
“This is a spectacular achievement - especially as between 2006 and 2008 the seven participating supermarkets grew sales volumes by five per cent,” BRC Director General Stephen Robertson said. “Changing customer habits on this scale, this quickly, isn’t easy. But it’s a huge testament to customers, who’ve switched to bags for life and cut bag usage. Hard working retail staff also deserve credit, as do our supermarket members - who’ve spent the money during these tough times to help this happen.” “These figures send a clear message: the voluntary approach is very successful and can lead to better informed customers and lasting change.”
“Reducing the number of carrier bags handed out is only one of retailers’ many green commitments. For example, supermarkets are working hard to reduce food waste - a bigger polluter than carrier bags,” Mr Robertson added. “They’re also promoting recycling, discounting energy efficient products and cutting their own energy use.”
Source: www.ausfoodnews.com.au
Mint producers face shaky future: report...
The latest research from UK research firm Mintel has discovered the market for mints is suffering. After seeing growth in the early part of this decade on the back of strong and sugar-free products, sales of mints have performed poorly in the UK. Over the last five years alone, the mint sector has declined by as much as 8% - falling from £204 million (A$416m) in 2004 to just £187 (A$382m) million in 2009. What is more, things are looking pretty sticky for the future of the humble mint, as sales are set to tumble a further 11% in the next five years.
Today, six in ten (60%) eat mints, the number of mint eaters declining from two-thirds (66%) in 2004. Just over a third (35%) of eat mints 2-6 times a week, while around one in two (52%) enjoy mints just 2-3 times a month or less. “Once a firm favourite among Brits, the mint sector is struggling. An older and declining consumer base, together with relatively little product development has hampered growth,” Michelle Strutton, Senior Consumer Analyst at Mintel, explained.
Over the last 2 years, soft and chewy (6% decline) and mild (17% decline) mints have both taken a real battering. And things have really turned sour for Granny’s favourite - the classic boiled mint, where sales fell by a hefty 35% over the same period. “Traditional segments such as boiled and mild mints have largely been overtaken by innovations elsewhere and changes in tastes that are seeing many younger adults migrate to products such as chewing gum,” Ms Strutton noted.
But there is one ray of hope, with strong mints a shining light in the ailing sector. In fact, market growth of 16% in the past 2 years alone has seen strong mints bring a breath of fresh air to the mint market. More than just a sweet, the extra strong variety are being used for their oral hygiene properties. Today, some 71% of Brits eat mints (or gum) to freshen their breath, while 46% use them to get rid of a strange taste and 30% to clean teeth in the absence of a toothbrush.
“Like chewing gum, strong mints are benefiting from consumers increasingly looking for a burst of freshness, underlining the importance of oral properties,” Ms Stratton concludes.
Source: www.ausfoodnews.com.au
Study sheds light on grocery behavior shifts...
A new study offers insights on changing grocery shopping behaviors as a result of the recession, including which food and beverage categories are proving most and least susceptible to brand abandonment and which consumer segments have been most and least affected.
The online survey, conducted between May 28 and June 4 this year, was sent to a nationally representative sample drawn from Digital Research Inc.'s (DRI) online panel. Results are based on responses from 1,106 grocery shoppers. The margin of error is 2.9%. Overall, about 40% of grocery shoppers report trading down to store brands since the recession hit, and just 29% say that they prefer name brands even if they cost more than store brands, according to the research from DRI and analytics services provider ThinkVine.
However, switching to private label isn't the most dominant change in grocery shopping habits. Well over half reported stocking up on sale items (58%), reducing spending on non-essential items (57%) and using more coupons/promotions. In addition, 47% reduced impulse purchases, 44% bought fewer convenience foods, and 42% made fewer trips to the grocery store. Nearly half (47%) reported spending less now than a year ago, (40% the same, 13% more). On a five-point scale with five representing "extremely important," 38% ranked getting the "absolute lowest prices" when grocery shopping as a five, and another 39% as a four.
However, concern with healthy eating and customer service continue despite the widespread focus on price and promotions. Just 15% said that they're willing to buy fewer fruits and vegetables to save money. Asked which behaviors they would engage in in order to get the lowest prices, least-likely changes included patronizing stores with a poor selection of natural/organics or poor selection overall, bad customer service or slow checkouts.
Most-likely cost-saving behaviors included (in order) clipping coupons, buying only on-sale items, shopping at a store with better weekly specials, switching to store brands, comparing store flyers, switching to lower-cost brands, browsing Internet coupons, bagging one's own groceries and driving to multiple stores to get the best prices. About half (51%) say they expect to continue to spend the same for the rest of this year, and 47% say they expect to make additional cutbacks. Only 3% expect to increase spending.
Categories Hit By Changes
Shoppers were asked whether they had made any of the following changes during the past three months in regard to specific F&B categories: only buying the preferred national brand with a sale or coupon, buying a different size of the preferred brand, buying a lower-priced national brand, buying generic/store brands, buying the preferred brand at a lower-cost store.
More than half indicated that they'd made at least one of these changes in regard to cookies (57%), crackers (54%), ready-to-eat cereal (53%), salty snacks (53%), juice beverages (53%), salad dressing (53%), and paper towels (52%). Nearly half (49%) indicated the same about pasta sauces, orange juice and laundry detergents. Categories less susceptible to changes were milk (36%), pet products (40%), coffee (43%), bread (43%), carbonated soft drinks (44%) and yogurt (46%).
Among the majority who did make some behavior change, switching to generic or store brands was most common for milk (19%), paper towels (15%), bread (14%), cookies (14%) and crackers (12%). Eleven percent reported switching to private label within ready-to-eat (RTE) cereal, orange juice, salty snacks, juice beverages; 10% within past sauces and yogurt; and 8% within laundry detergents, carbonated soft drinks, salad dressings and coffee. Pet products? Just 7% switched to private label.
Among those who changed behaviors, categories in which consumers are most likely to buy a preferred brand only when there is a sale or coupon were salad dressings (29%), RTE cereals (27%), crackers (26%), salty snacks (25%) and cookies (25%). Least susceptible to this behavior were brands in the milk (7%), bread (11%), pet products (16%) and coffee (19%) categories.
'Nouveau Poor' Among Biggest Shifters
The study identified six distinct shopper segments based on economic impact, lifestyle changes and shopping behaviors. Consumers who have most altered their grocery shopping behaviors fall into two segments dubbed "nouveau poor" and "hard times." The nouveau poor (4.6% of the population) has been created by the recession. These consumers have high education levels, but are experiencing lifestyle upheaval after a dramatic reversal of fortune. About one-quarter are unemployed and job hunting; 67% are having mortgage/foreclosure issues, and 82% are having trouble paying bills.
The hard times segment (21.1%) comprises people who are struggling to make ends meet under mounting economic pressure. About half have seen income reduction, have credit card debt, and are struggling to pay bills; and 17% are unemployed and job hunting.
The "modest means" segment (28%) comprises consumers who were already used to economizing and are now further tightening their belts. In better position are "optimizers" (12%), characterized by strategically balancing brand, convenience and quality with affordability; "cautious success" consumers (26%), who are doing well but avoiding excessive spending; and the "unfazed" (8%), who basically haven't felt the need to change their shopping behavior.
Nearly 71% of the nouveau poor and 61% of the hard times segment report substantial changes in their lifestyles made to stretch their dollars, compared to an average of 31% across the segments. In addition, 69% of the nouveau poor and 58% of hard times rate getting the absolute lowest prices as extremely important, versus 48% of modest means, 40% of optimizers, and 9% of cautious success. (Interestingly, 20% of the unfazed also rank this as extremely important.) The nouveau poor dominate discount grocery stores (18% usually shop in these), although they also account for 10% of store visits to higher-spend grocery outlets.
The two hardest-hit segments are also least likely to to agree that they buy name brands even if they cost more than store brands, and least likely to look for foods that are quick and easy to prepare.
However, even these two segments are reluctant to give up on healthy eating. In fact, they are somewhat more likely than other segments to agree that healthy eating is very important to them, and about equally likely to say they're trying to avoid processed foods and buy more organic/natural foods.
Source: www.mediapost.com |
