The recession: what it means for UK consumers

Transcription

1 The recession: what it means for UK consumers Jonathan Banks 20 September :50 14:10 Special thanks to +44 (0) The recession: what it means for UK consumers Retailers Suppliers 1

2 I have no spare cash 30% 25% 20% 15% Oct-05 Apr-06 Oct-06 Apr-07 Oct-07 Apr-08 Oct-08 Apr-09 Oct-09 Apr-10 Oct-10 Apr-11 Source: Nielsen Global Online Survey, GB. Once you have covered your essential living expenses, which of the following statements best describes what you do with your spare cash 25 Unemployment Spain France Britain Germany latest Sources: UBS/The Economist (2012 = April, May, or June) 2

3 Consumer confidence index Oct-05 Apr-06 Oct-06 Apr-07 Oct-07 Apr-08 Oct-08 Apr-09 Jul-09 Oct-09 Dec-09 Mar-10 Jun-10 Oct-10 Dec-10 Mar-11 Jun-11 Oct-11 Dec-11 Mar-12 Jun-12 Source: Nielsen Global Online Surveys: GB results to June Eating out g/person/week Meat Indian, Chinese, Thai Cheese, egg dishes, and pizza Fish Source: Defra Living Costs and Food Survey 3

4 Fish consumption at home g/person/week Ready meals White fish Salmon Shellfish Takeaway fish 0 Sources: Adjusted National Food Survey data 1974 to 2000, Expenditure and Food Survey to 2007 and Living Costs and Food Survey 2008 onwards Sandwiches Sandwiches Meat based Fish based Source: Defra Living Costs and Food Survey 4

5 GDP per capita vs. Household spend on food Norway GDP Per Capita, US $ U.S.A. Ireland Netherlands U.K. Australia Germany Denmark Sweden Finland Greece France Japan Spain R 2 = 0.8 Czech Republic Korea Slovakia Estonia Poland Turkey Brazil Latvia Lithuania Argentina China Household Spend on Food (%) Namibia* Russia Romania India * Household spend on food (%) is for Caprivi, Kavango, Ohangwena, Omusati, Oshana, and Oshikoto. Sources: UN; International Labour Organization; allcountries.org; National Bureau Of Statistics of the The Peoples Republic Of China; swivel.com; World Resources Institute; International Finance Corporation The recession: what it means For UK consumers: More with no spare cash Job security worries despite low unemployment Consumer confidence low Moving to less expensive eating out options In home: ready meals, white fish How retailers are reacting with their consumers How suppliers should react with the retailers 5

6 Evolution of formats in Europe 19% 18% 17% 16% 16% 15% 15% 14% 14% 13% 12% 12% 12% 12% 11% 11% 10% 10% 10% 10% 9% 26% 25% 23% 22% 20% 19% 18% 16% 15% 14% 12% 10% 9% 8% 8% 7% 6% 6% 5% 5% 5% 4% 4% 4% 4% 3% 3% 3% 3% 19% 20% 26% 26% 26% 26% 27% 27% 27% 27% 27% 26% 27% 27% 28% 28% 28% 27% 28% 28% 21% 21% 21% 21% 22% 22% 25% 24% 25% 25% 25% 26% 25% 27% 26% 26% 25% 19% 19% 18% 12% 12% 13% 13% 15% 17% 16% 20% 20% 21% 21% 21% 21% 22% 22% 22% 22% 23% 23% 22% 22% 23% 23% 23% 24% 24% 14% 15% 16% 17% 18% 19% 20% 22% 23% 24% 26% 27% 28% 29% 30% 31% 32% 32% 33% 34% 34% 35% 35% 35% 35% 36% 36% 36% 36% Source: Nielsen Trad Supret SSM LSM HM Retail market concentration % #1 #2 #3 #4 #5 80% 60% 40% 20% 0% NOSWCH DK FI NL AU BE UK FR IE SP DE SK PT CZ HU IT PO Sources: Nielsen/Kantar 6

7 Discounters in Europe 45,000 40,000 r2 = store count 35,000 30,000 25,000 20, ,000 10,000 Source: Nielsen, Europe 10% 11% 12% 13% 14% 15% 16% 17% 18% 19% 20% share % on promotion 42% 40% 38% 36% 34% Anyone for EDLP? Morrisons Asda Tesco Sainsburys 32% 30% 28% 26% Mar-08 Jul-08 Nov-08 Mar-09 Jul-09 Nov-09 Source: Nielsen Source: Nielsen Homescan 7

8 Retailer brands evolution: brand architecture Better for you Premium Regular Better for the planet Basic Health & Wellness Value for money Responsible consumption The recession: what it means... Retailers Concentration of buying power Large Supermarket and Hypermarket growth Discounters Promotions Private label On-line: 5% share, price comparisons How suppliers should react with the retailers 8

9 4 megatrends (+ Value for money!) Health/ Well-Being Ethical Indulgence/ Pleasure Convenience/ Practicality What are the main reasons you don t eat fish? GB I don't like the taste I don't like the smell I don't like the bones I don't like the appearance (fins, scales, head) I'm opposed to eating fish because of my personal beliefs It's too expensive I don't know how to cook it It's not easily available 50% 34% 28% 23% 15% 12% 8% 2% Source: Nielsen Global Online Survey April 2008 What are the main reasons you don t eat fish? Convenience and Practicality reasons Base: Respondents who Rarely or Never eat Fish 9

10 Ethical: Consumer confusion Consumer Confusion Aquaculture v wild Fully exploited over-exploited Food miles v carbon emissions Organic For some organic = wild Different accreditation schemes = different standards glazing, injection, shelf-life Say they ll pay a (10%) premium for sustainability but don t in practice Value for money, taste and convenience override altruism For some: a general mistrust of big business For the majority trust in retailers Choice editing 10

11 How to turn 17.5p/100g into 35.5p/100g Source: 15/10/11 Closing thoughts Be the masters of your own destiny... Focus on the consumer Remember why they reject fish Compete on quality more than price! Premium opportunities exist: Convenience, Health, Indulgence, Ethical Understand, quantify, and develop the drivers of your Brand Equity Don t wait for the recession to end! 11

12 Closing thought on marketing in a recession... Revenue growth in first 5 years after 1980's recession 276% 19% Companies that cut sales and marketing efforts during recession Companies that maintained sales and marketing efforts during recession Source: McGraw-Hill Research Thank you! jonathan@jonathanbanks-associates.co.uk +44 (0)