The Irish Foodservice Market Seminar
November 19, 2009
Presented by Helen King, Senior Business Analyst

Knowing the Consumer

Understanding what has changed

Today the world is constrained by financial hardship

Tomorrow we can expect a more positive environment

Two critical challenges
Navigating the challenges of today
• Helping your customer get the right value proposition.
• Avoid devaluing your brand through fighting just on price and / or cutting quality.
• Getting smart innovation quickly into the market that enhances the foodservice offering.
Planning for the longer-term

Two critical challenges
Navigating the challenges of today
• Get the right message to the consumer regarding your value proposition.
• Avoid devaluing your brand through fighting just on price and / or cutting quality.
• Getting smart innovation quickly into the market that meets consumers‟ needs today .
Planning for the longer-term
• Build genuine lasting value that is relevant for your consumers and customers.
• Ensure that you are well placed for growth when it returns.
• Bring new innovation to the market rather than offer incremental improvements.

How we identify and understand trends
Quantitative study covering 20 markets and 90% of global GDP;
46 cites in 28 countries
Qualitative depth interviews in Ireland and GB
Top Down
Can we identify substantial
Drivers behind this trend that suggest it will continue?
TREND
Can we see evidence of this trend at work in brand or human behaviour or attitudes?
Bottom Up

Key drivers shaping consumers lives
Theme
FEAR &
ANXIETY
CHANGING
LIFE STYLES
EVOLVING
ASPIRATIONS
GROWING
KNOWLEDGE &
INFORMATION
Specific drivers
•
Economic anxieties
•
Declining trust in governments and big business
•
Scientific advances
•
Growing impact of resource shortages
•
Increasing life expectancy
•
Changing working patterns
•
Increasing mobility
•
Growing knowledge of the world’s opportunities
•
Growing public and media focus on health and image
•
Backlash against accelerated culture
•
Rising consumer curiosity and desire for transparency
•
Rise of new media and communication technologies
•
Growing awareness of environmental and social issues
•
Increasing availability of information
DYNAMIC
MARKETS
•
Growing market competition and choice
•
Rising globalisation

“I want to stay in control of my busy life and make sure I am at my best for the challenges the day presents”

For many people, lives remain busy and time in short supply
13 minutes to prepare a meal at home
% Agree
Factors Influencing Eating Out More Often
“Too tired to make something at home”
50
40
30
20
10
0
37%
35%
Ireland GB
Source: PERIscope 5
35%
Northern Ireland

Time out to re-charging energy levels is increasingly important
30
20
10
0
90
80
70
60
50
40
Importance in your personal life today: Schedule down time or "me"
% Extremely/Very Important time
100
64
70
56
67
2008
IRELAND
2009 2008
GB
2009
Source: Global MONITOR 2009
Naps produce significant advantages to brain concentration.

Convenience is no longer king, where money can be saved people will find a practical solution
“ Convenience is relevant, but I‟m not going out and paying convenience food prices ”
Male, rural, Ireland
Sales of dough to make bread and pizza bases at home are soaring in
Italy

Broadening convenience - going to your customer

Beyond the Recession
• People will have a better sense of what they can do for themselves quickly and cost effectively
Consumers will want high quality produce available when they need it
Packaging will continue to evolve to support a life spent more on-the-go and help navigate choice quickly

“I need to balance the stresses in my everyday life with experiences that are fun and fulfilling”

There is less money for conspicuous consumption
“Food is ultimately a cheap treat, we can therefore maintain our investment in indulgent food more easily”
Alice Pegg , Head of Food
Innovation, Leatherhead Food
International
Champagne sales dipped from
€22.5m to €13.6m, in Q1 2009

But people still need a way to release pressure and bring some fun back into life
Importance in your personal life today: Having Fun
% Very/Extremely
Important
100
90
80
70
60
50
40
30
20
10
0
72
2008
80
2009
77
2008
82
2009
GB IRE
Flash Mobs have become a free and fun way to bring a little laughter back into life.

Food continues to be a great outlet for creativity, exploration, and play
80
70
60
50
40
30
20
10
0
Importance in your personal life
100 today: Expressing your creative
% Very/Extremely Important side
90
39
49
45
56
2008 2009 2008 2009
GB IRE

Beyond the Recession
• The recession may have awakened people to the fact that many of life’s great experiences are often free
• The home can be a great place to connect with the people that matter in life and a cost effective place to have fun
• Eating out may have to offer more than just the usual restaurant experience.

“I would like products that create less negative impact on the world; I want choices that make me feel good without harming my wallet ”

Rising prices have brought home the connection between consumerism and sustainability
Oil prices are expected to rise until at least 2010

A focus on value has meant some positive choices have had to be put on hold
% Agree
100
90
80
70
60
50
40
30
20
10
0
I've become less concerned about environmental issues as the economic situation in the world has worsened
31
32
20
30
Ireland GB Rest of EU US
Source: Global MONITOR 2009

Charity now has more of a „homely‟ feel
Buying local is a good way to lessen the power of multinational companies
% Agree
100
80
60
40
20
0
73
70
67
Ireland GB
Source: Global MONITOR 2009
Rest of EU
68
US

BEYONDTHE RECESSION
• People will continue to scrutinise companies for the impacts they make
• Manufacturers are likely to need to take greater ownership of their waste.
• Supporting local may become a stronger shorthand for sustainability and supporting worthwhile causes.
TapIt water

“I want to be in control of my health and wellness, to manage or improve it through making better choices”

Health is still a top concern for people and regulatory authorities
Nutrition disclosure on menus
An 18% levy on non-diet soft drinks

An increasingly balanced lifestyle approach emerging as people seek to take control of their own health
60
40
20
0
I believe that looking after my health is entirely my own responsibility
% Agree
100
90
85 84
88
80
Ireland GB Rest of EU
Source: Global MONITOR 2009
US

More traditional and natural solutions are increasingly popular
“ This is what it‟s all about. Natural.
Something you can either pick or catch ”
Male, foodie, prefamily, urban,
Ireland

Beyond the Recession
• Natural and pure will continue to represent a healthier choice
• Maximising the positive qualities of natural ingredients and reducing the down side via nanotechnology

“I like to pursue better value, to help maintain my lifestyle and to get the most from the money I have”

Shopping around and trading off convenience for a better price
% Agree
100
90
80
70
60
50
40
30
20
10
0
I like to splash out on some products or services, even if it means I have to economise more radically in other areas
54
46
35
49
Ireland US GB Rest of EU
2009
Source: Global MONITOR 2009

A changing sense of what represents value
Buying own brand is an increasingly popular consumer strategy for saving money.
“I‟ve even tried sneaking in some own brand products, like the other day when I bought some own brand Weetabix. My daughter noticed but to me it tastes exactly the same”
Female, non foodie, older family, Sheffield

A strong desire for indulgence remains but, on a smaller scale
“
Farmers markets I find are expensive, so I‟ll only go once in a while to treat myself and buy a nice piece of meat or some good quality bread; things I can‟t find in the supermarket”
Male, foodie, pre family, London
L‟Oreal
Lipstick Effect

THE RECESSION AND BEYOND
• The pursuit of value is likely to remain even after the recession
• People will want to deepen their knowledge of production, and even be prepared to get involved in the processes
• Products that offer a luxury experience will increase in appeal again as prosperity returns

“I am looking for products and brands that are real and authentic, because they have stood the test of time and remained true to their heritage; they provide me with comfort and reassurance.”

The past offers us something real and a simpler time absent from the superficial excesses of today
% Agree
100
80
60
40
20
0
I worry that aspects of our culture and traditions are being lost as the world converges into one single global culture
66
69
64
60
Ireland GB Rest of EU
Source: Global MONITOR 2009
US

A deepening connection with our food offers both the „real‟ experience and a means to be more self-sufficient
“ There‟s nothing better than picking your own veg and eating them then and there.”
Foodie, London
A patch of the
South Lawn at
White House has been turned into a vegetable garden

Our appreciation of artisan skills has deepened and there is a desire to re-learn what the past taught us
Sainsbury‟s offers us help in making the most of our leftovers with 10 things to do with…

Beyond the Recession
• New forms of growing your own emerge meaning that local and seasonal become greater features of life
• Consumers may look to secure their supply by sponsoring or seeking ownership of the authentic source
• Innovative methods of producing emerge

Some thoughts for competing in the foodservice environment
Navigating the challenges of today
• How can you help enhance the experience offered by your foodservice customer?
• How can you help them deliver the fun experience of dining out in a cost effective way?
• Can your local credentials be used to build a positive story?

Some thoughts for competing in the foodservice environment
Planning for the longer-term
• Stronger focus on growing ingredients and food- What new solutions can you offer that play to this desire?
• Can you offer a more sustainable source at a cost effective price? How can you ensure that your manufacturing process keeps the food as close to its natural state as possible?
• Are there ways that you can further lock in the goodness?
• How can you help your foodservice customer get the most from your products and help them reduce waste?

The Irish Foodservice Market Seminar
November 19, 2009
Presented by Helen King, Senior Business Analyst