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Prepared for Potatoes New ZealandMarch 2014
INCREASING POTATO SALES & CONSUMPTION
KEY FINDINGS
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AGENDA
Prepared for: Potatoes NZ
1 RESEARCH BRIEF
2 METHODOLOGY
3 EXECUTIVE SUMMARY
4 WHAT IS IMPORTANT WHEN PREPARING FOOD?
5 POTATO TRENDS
6 QUANTITY OF POTATOES CONSUMED
7 WHAT IS THE POTATO OCCASION?
8 SHOPPING & CHANNEL TRENDS
9 HOW DO WE MARKET?
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RESEARCH BRIEF
Background
• Potatoes NZ is a body that represents the potato industry in NZ, representing growers through to retailers in the marketing of potatoes in the domestic market in NZ. Potatoes NZ completed a comprehensive consumer segmentation study with Nielsen in 2009.
Research Objective
• Potatoes NZ want to increase the level of knowledge about the category and potato consumer behaviour to share with the industry and implement marketing and communication strategies to drive positive change for potatoes and increase potato sales/consumption.
Information Requirements
• What is the size of the potato market in NZ?
• What quantity of potatoes are NZ’ers consuming?
• How has consumer purchasing of potatoes and attitudes towards potatoes changed? What is driving this change?
Prepared for: Potatoes NZ
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4Prepared for: Potatoes NZ
• Nielsen Homescan is a consumer panel of 2,500 household, representative of the population which scans all grocery items taken into the home
• For fresh food this includes random weight and bar-coded items purchased from any outlet
• Data to period is 52 weeks to 8 September 2013 compared to prior year. Majority of analysis has been completed in dollars.
• Sample size of N=1,000 online interviews to obtain a robust national mainstream measure. Predicted margin of error ±3.1%
• Sample sourced from the Survey Sampling International (SSI) panel which has over 50,000 NZ members. Fieldwork was completed in October 2013
• Questions around attitudes and perception of food and behaviour and consumption of fresh potatoes were asked in the survey.
COMBINING MULTIPLE QUANTITATIVE APPROACHES
Combining both approaches allow us to segment households and shoppers to understand current purchase behaviour alongside attitudes and motivations for purchase to prioritise
marketing focus and strategic direction on how to increase potato sales/consumption.
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21
13
19
14
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Adult Couples / Singles Young HouseholdsMixed Households Older HouseholdsOlder Couples
LIFESTAGE GROUP DEFINITIONConsumer researchHomescan % Buyers
Prepared for: Potatoes NZ
1. Young Households: Households with children < 5
2. Mixed Households: Households with children 5 to 15
3. Older Households: Households with children > 15
4. Older Couples: Older households without children / no children at home
5. Adult Couples / Singles: Young couples / single households without children
6. Others: Flatting / other household compositions
16
8
10
35
31
Young Families Mixed FamiliesOlder Families Older Singles & CouplesAdult H-holds
1. Young Families: Adults/shoppers any age, all kids < 11 years
2. Mixed Families: Adults/shopper any age, at least 1 child < 11 and at least 1 child 11-17
3. Older Families: Adults/shopper any age; all kids aged 11-17
4. Older Singles/Couples: All adults aged 45+, no children, hhld size 1 or 2
5. Adult Households: At least 1 adult aged 18-44, no children
EXECUTIVE SUMMARY
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7Prepared for: Potatoes NZ
HOW DO WE INCREASE POTATO SALES AND CONSUMPTION?
Focus for growth is to maintain buyer engagement & encourage more frequent purchase:
• Re-align pricing relativity of larger pack sizes as are likely driver of less frequent purchase as shoppers seek value
• Create better value perception outside of pricing; versatility, complementary, ease
Increase appeal and relevance of fresh potatoes for category consumers:
• Create more excitement through relevant occasions for young shoppers (target shoppers < 35 years)
• Bring together strong perceptions of fresh and natural to modernise flavour and taste
Address barriers to consumption:• Young singles and couples – difficult preparation and extravagance • Mixed households need to be convinced of the convenience from
eating potato dishes • Health and weight management – continue to convert (3% increased
consumption from knowing of health benefits)
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8Prepared for: Potatoes NZ
HOW DO WE INCREASE POTATO SALES AND CONSUMPTION?
Use marketing & communications mix to: • Deliver messages to families around value & convenience to
compete with rice and pasta• Encourage usage as versatile ingredient in ethnic foods and less
traditional meals, target <35yrs• Increase knowledge of health benefits• Teach shoppers how to use fresh potatoes to make chips/wedges,
ingredients in pies/stews, to increase family appeal
Activate: in-store and outside the retailer:• More accessibility to relevant messages in-store such as cooking
instructions and meal ideas to encourage all segments• Easy pre-prepared cut/seasoned potato offer located in the produce
section to complement frozen offer - target households with children
WHAT IS IMPORTANT WHEN PREPARING FOOD?
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HOW IMPORTANT IS FRESH FOOD?
• Food sector accounts for one third of NZ’ers retail spending
• $25B spent last year on food*
• Groceries are purchased on average every three days
• Fresh Food is important
• Included in 69% of all shopping occasions
• accounts for 1 of every $4 spent (26.4%)
• Fresh fruit & vegetables are in ¾ of all fresh food baskets
• Purchased every 6 days
• Account for 39% of fresh food $ sales
Source: Retailers Association includes supermarket & grocery stores, specialised food & Food & beverage servicesSource: Nielsen Homesan.
9 in ten want meals to be
tasty & value for money
Healthy, fresh, suitable for all
& ease are important to consumers
Question 8: Here are a few things some people have said is important to them when describing what they expect when preparing food for a meal. How strongly do you agree or disagree with the following statements…Base: All Respondents : n=1000
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11Question 9: Again, thinking of the same statements, please indicate which of these food items you would associate with each of the statements here. (Correspondence mapping analysis)Base: All Respondents : n=1000
It has to be filling
It needs to be energising
A treat for everyone / myself
Will be convenient to eat
A family favourite
A meal for everyone
Traditional cuisine
Comforting food
It's healthyMade of natural ingredients
Tasty / flavourful
A modern food
A good source of vitamins / nutrients
Easy to prepare / cook
Good value for money
An extravagant dish
Made of fresh ingredients
Complementary to other food dishes
Natural / unprocessed food or dish
A food item from which I can use to make various dishes
Fresh potatoes
Rice
Pasta
Starchy vegetables
NaturalConvenient
PROMOTE CONVENIENCE, SUITABILITY FOR MEALS & VALUE FOR MONEY TO CONVERT FROM RICE & PASTA.
Tasty
Traditional
Broad potato appeal but seniors more likely to buy root veg.Target communications around freshness , ease of cooking towards young couples.
Value & convenience stronger for rice & pasta.
Families more likely to buy rice, pasta & frozen potatoes.
POTATO TRENDS
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FOCUS FOR GROWTH IS TO MAINTAIN BUYER ENGAGEMENT & ENCOURAGE MORE FREQUENT PURCHASE.
Source: Nielsen Homescan NZ | MAT to 26.Jan.2014 vs. YA
Number of households buying
is slightly less, down by 0.8
Buyers spending per trip is slightly more, up by 2.8%
Frequency of purchase
reduced by 2%
94.5% $4.49 11.5 times
• 75% NZ hhlds buy fresh potatoes every two weeks.• 94% hhlds prepare fresh potatoes at least once a week for their meals
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ENGAGE SHOPPERS UNDER 35YRS FOR $ GROWTH
Source: Nielsen Homescan
• Core buyer is 1-2 person household without children, +55yrs• Barcode more important to families
• Older singles & couples more likely to buy loose potatoes
• Shoppers <35yrs less engaged with potatoes this year• Losing buyers from young & mixed families
• All family groups spending less than year ago
Older singles & couples shop
most often but have lowest
spend per trip.
Families have a higher spend per trip likely
driven by barcoded formats.
WHO BUYS POTATOES?
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34.2
22.4
14.1
15.8
13.6
Potatoes Category
Kumara
Rice
Pasta
FrozenPotatoes
Fresh Potatoes
57% of category spend goes to potatoes
% of Category Spend Key reasons for higher consumption of fresh potato substitutes:
Source: Nielsen Homescan. Data to MAT 08 Sep 2013
%
Rice:Easy to useSuits / Complements mealsTraditional / staple food
Pasta:Versatile / used in a variety of waysEasy to usePreferred by the family
Starchy veg:Taste goodHealthyLike it
6 IN EVERY TEN DOLLARS IS SPENT ON POTATOES…..Ease of preparation and versatility are the main reasons for consuming fresh potatoes
BUT MORE THAN 4 IN EVERY TEN DOLLARS IS ON SUBSTITUTES!
Potatoes & Substitutes
POTATOCONSUMPTION
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WHAT QUANTITY OF FRESH POTATOES DO NZ’ERS CONSUME?
Take home Consumption = Quantity purchased less wastage
Annual consumption per capita
(total popn.)
Kilograms purchased retail 97M
Estimated wastage kilograms 185,660
NB. Calculation uses estimated retail sales (actual sales from supermarkets combined with non supermarket estimate based on Nielsen Homescan non supermarket share) and calculation on wastage from consumer research about last purchase (5% of people wasted potatoes, on last purchase & 3% normally waste potatoes with less than 25% of purchase the norm wastage qty)
22.89kg
• Only 3% of shoppers regularly waste potatoes with majority throwing out less than 25% of purchase qty.
• Half a kilogram of potatoes is used in most meals
• 4 in ten is eating recommended serving size of potatoes
• 37% are having larger quantities than recommended
• Older couples are eating in smaller proportions than last year
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Q29: Consumption of Fresh Potatoes (%)
MORE OCCASIONS, VALUE AND COOKING IDEAS HAVE DRIVEN INCREASED CONSUMPTION IN THE LAST YEAR1 in 4 of those who have increased consumption in the last year have done so after knowing of the health benefits from consuming fresh potatoes
Question 29: Now, compared to the same time last year, would you say that your consumption of fresh potatoes has… Question 30: Why has your consumption of fresh potatoes increased in the last year?Q29 Base : All Respondents (Answering Base) n=999 | Q30 Base: Respondents who consume more potatoes than last year n=112
Series1
16
71
13
Increased
Stayed the same
Decreased
I prepare more meals with fresh potatoes now than I used to 53Cheaper than other similar types of food 37
More recipe ideas 33Knowledge about health benefits 25
Q30: Reasons for increased consumption(%)
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Q29: Consumption of Fresh Potatoes (%)
COMMUNICATING HEALTH BENEFITS, VALUE FOR MONEY & EASE OF PREPARATION WILL ADDRESS BARRIERS TO PURCHASE.
Q31: Reasons for Decreased Consumption:
Question 29: Now, compared to the same time last year, would you say that your consumption of fresh potatoes has… Question 31: Why has your consumption of fresh potatoes decreased in the last year? Q29 Base : All Respondents (Answering Base) n=999 | Q31 Base: Respondents who consume less potatoes than last year n=172
Series1
16
71
13
Increased
Stayed the same
Decreased
I don't prepare as much meals or dishes using fresh potatoes now than I used to 44
Not part of my diet 19I buy potatoes that are of a smaller size now than before 14
Too expensive to buy 11
Takes too long to prepare 9
WHAT IS THE POTATO OCCASION?
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WHAT IS THE POTATO OCCASION?
• Family meals are the most frequent occasion for consuming fresh potatoes• Complement other foods, served as a side, considered filling
• Mashed, roasted , boiled potatoes are the most common methods of preparing potatoes• Mashed potatoes consumed during family meals & quick
& simple occasions
• Boiled potatoes are made for healthy meal occasions
• BUT Fresh potatoes are not servicing all family potato needs • Only 7% prepare chips/wedges with fresh potatoes most often
• Made as a treat/snack for kids
• Families are 37% more important to frozen potato category compared to fresh potato
How do we cater to young families?• Addressing
convenience in preparation
• Retail fresh and ready cut
• Support with the right cooking instructions in-store
SHOPPING & CHANNEL TRENDS
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63% F&V specialists
33% 4% Supermarket
Shop at both OutletsShop Exclusively
Nationwide Fresh Potatoes : Supermarket vs. Fruit and Vege Specialists
Source: Nielsen Homescan Data to MAT 08 Sep 2013
CONVENIENCE LIKELY DRIVER OF CHANNEL CHOICE
Fresh Potato: % Value Share across Channel
…BUT VALUE KEY FOR FAMILIES WITH OLDER CHILDREN & SENIORS
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SHOPPING TRENDS
Fresh Potato: % Value Share Loose vs. Bar-coded
62
38
Share of spend
Barcoded potatoes Loose Potatoes
• 6 from every $10 spent on potatoes is barcoded format
• Shoppers tend to buy on auto-pilot
• Only 1 in ten claim to buy on promotion
• Top 3 shopper in-store information needs are information on cooking instructions, potato variety & country of origin
• 6 in ten shoppers are aware of white, red & Agria varieties
HOW DO WE MARKET?
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BETTER VALUE AND MEAL IDEAS WILL HELP ENCOURAGE HIGHER CONSUMPTION
Source: Nielsen Homescan NZ | MAT to 26.Jan.2014 vs. YA
Cheaper
1 in 5 are also looking to know more about the health benefits of potato consumption as well as wanting better quality (i.e. storage) potatoes
• Q32: Top 4 Reasons - Encouragement to Eat More Fresh Potatoes
Cheaper 36%
Ideas/different recipes
34%
Health benefits
19%
Last longer18%
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HOW DO WE MARKET?
• Encourage young shopper in promoting taste/flavour without jeopardising seniors traditionalist view• Modernise potato perception & usage - ease of preparation, versatility & cooking tips
• Make things easy for families with preprepared fresh cut/peeled/seasoned offer
• Encourage consumption through recipes
• 6 in ten shoppers often try out a new recipe
• 3 in ten try out new potato recipes each month
• Change in meal mix and cooking enjoyment are key drivers
• Create online awareness of potatoes.co.nz via high traffic sites such as social media/search engine as awareness is low
• Communications via NZ Herald have the potential to reach 1 in 3 hhlds
