The Irish & UK
Grocery Retail
Landscape
David Berry – Commercial Director, Kantar Worldpanel
© Kantar Worldpanel
The Agenda
>
– Global Context
– GB & ROI Market Health
– ROI Key Trends
– GB Key Trends
– ROI Retailer Evaluation
– GB Retailer Evaluation
© Kantar Worldpanel
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
While the domestic economy continues to struggle
global GDP grows consistently
Global GDP growth
6
5
4
3
2
1
0
-1
© Kantar Worldpanel
World Population 1950 - 2050
9 billion
8 billion
7 billion
6 billion
5 billion
4 billion
3 billion
Source: UN World Population Prospects
© Kantar Worldpanel
FAO Food Price Index
© Kantar Worldpanel
The Agenda
– Global Context
>
– ROI & GB Market Health
– ROI Key Trends
– GB Key Trends
– ROI Retailer Evaluation
– GB Retailer Evaluation
© Kantar Worldpanel
Cash strapped, cautious although (slightly) less fearful
UK Consumer Confidence Index
0
-5
-10
-15
-20
-25
-30
-35
Nationwide (Up to May 2012)/ESRI (Up to Sep 2012) Consumer Confidence Index
Source: Kantar Worldpanel & Nationwide Consumer Confidence
© Kantar Worldpanel
3% market growth in GB adds £3bn, Irish market
remains flat
WE & USA Q3 2012 FMCG Sales Performance
5
3
3
2
2
1
1
0
0
0
-2
-4
© Kantar Worldpanel
How do the two grocery markets compare?
– Market Size
– €9b
– £100b
– €5,400
– £3,800
– Market Growth
– 0%
– +3%
– Price Inflation
– 5%
– +4.5%
– Grocery Spend per HH
© Kantar Worldpanel
The Agenda
– Global Context
– ROI & GB Market Health
>
– ROI Key Trends
– GB Key Trends
– ROI Retailer Evaluation
– GB Retailer Evaluation
© Kantar Worldpanel
Despite increasing inflation shoppers continue to
restrict their spend
15%
8.0%
10%
5%
5.0%
5.3%
0%
0.3%
-5%
-10%
Inflation
HH Spend change
Source: Kantar Worldpanel Ireland (ROI )
Grocery inflation across 38,000 items
1213
1211
2012
1209
1207
1205
1203
1201
1112
2011
1110
1108
1106
1104
1102
1013
1011
2010
1009
1007
1005
1003
1001
912
2009
910
908
906
904
902
813
2008
811
809
807
805
803
801
-15%
© Kantar Worldpanel
So how are
shoppers
coping?
Buy less
Store choice
Trade Down
-1%
-1%
-3%
© Kantar Worldpanel
47% 2012
46% 2011
44% 2010
© Kantar Worldpanel
The Agenda
– Global Context
– ROI & GB Market Health
– ROI Key Trends
>
– GB Key Trends
– ROI Retailer Evaluation
– GB Retailer Evaluation
© Kantar Worldpanel
13 Jul 08
10 Aug 08
07 Sep 08
05 Oct 08
02 Nov 08
30 Nov 08
28 Dec 08
25 Jan 09
22 Feb 09
22 Mar 09
19 Apr 09
17 May 09
14 Jun 09
12 Jul 09
09 Aug 09
06 Sep 09
04 Oct 09
01 Nov 09
29 Nov 09
27 Dec 09
24 Jan 10
21 Feb 10
21 Mar 10
18 Apr 10
16 May 10
13 Jun 10
11 Jul 10
08 Aug 10
05 Sep 10
03 Oct 10
31 Oct 10
28 Nov 10
26 Dec 10
23 Jan 11
20 Feb 11
20 Mar 11
17 Apr 11
15 May 11
12 Jun 11
10 Jul 11
07 Aug 11
04 Sep 11
02 Oct 11
30 Oct 11
27 Nov 11
25 Dec 11
22 Jan 12
19 Feb 12
18 Mar 12
15 Apr 12
13 May 12
10 Jun 12
08 Jul 12
05 Aug 12
02 Sep 12
30 Sep 12
28 Oct 12
25 Nov 12
23 Dec 13
Grocery Market Growth v. Inflation
Now trailing inflation again
Phase 1
Phase 2
12 we growth (Grocers RST)
Phase 3
10%
9%
8%
7%
6%
5%
4%
3%
2%
1%
0%
12 we inflation
© Kantar Worldpanel
So how are
shoppers
coping?
Buy less
Store choice
Trade Down
+1%
NC
-2%
© Kantar Worldpanel
© Kantar Worldpanel
Cross category sales performance
Every category within grocery is showing sales growth
GB Grocery Category Sales Change (%)
8.9
8.4 8.2 8.1
7.3
6.8
6.2 6.1
5.6 5.6 5.4 5.3
4.7 4.6 4.5
3.8 3.6
3.4
2.8 2.8 2.6
2.4 2.2 2.2
1.2
© Kantar Worldpanel
Cross category sales growth
The Fresh Food categories have added the most in
absolute sales
GB Grocery Category Absolute Sales Growth - £m
542
287 283
215
184
143 141 139 122
114 111 107
91 90 86 85
59 45 38
24 23 21 21 19 16
© Kantar Worldpanel
Multi-channel shopping is a growing dynamic in GB
© Kantar Worldpanel
© Kantar Worldpanel
The Agenda
– Global Context
– ROI & GB Market Health
– ROI Key Trends
– GB Key Trends
>
– ROI Retailer Evaluation
– GB Retailer Evaluation
© Kantar Worldpanel
Dunnes returned to growth for the Christmas period
27.8
Tesco
Dunnes
24.3
SuperValu
19.5
Aldi
6.0
Lidl
5.9
Superquinn
0.4
5.1
% share of Grocery spend (€)
1.9
-1.2
30.0
1.8
-4.6
% change 12 w/e 2012 v 2011
23
© Kantar Worldpanel
Objectives:
Maintain growth ahead of the market
Leave no reason to shop elsewhere
Drive value credentials
Build shopper empathy
How will this be achieved:
Push multi-channel, especially in Dublin
Use key events to drive excitement in store
Drive value to counter Discounter threat
Improve quality & image of fresh through Homegrown
24
© Kantar Worldpanel
Objectives:
Sustain momentum
Excellent in store execution
Use ValueClub around key events
Compete on value
How will this be achieved:
Targeted use of ValueClub
Use the big brands our shoppers love
Clarity & strength of promotional offers
© Kantar Worldpanel
Objectives:
Retain loyal shoppers
Win back lapsed shoppers
Build direct link to shoppers & their community
Grow through offering new ranges & services
How will this be achieved:
Providing clear value for money
Own Brand focus
Leadership in Fresh Food
Innovation in store & through IT
26
© Kantar Worldpanel
Objectives:
Continue to improve sales performance
Reinvigorate traditional strengths
Re-engage with the consumer
How will this be achieved:
Build relationships with shoppers
Relaunch the savings card
Refresh in store environment
Leverage traditional strengths – Fresh & Leinster
27
© Kantar Worldpanel
The Agenda
– Global Context
– ROI & GB Market Health
– ROI Key Trends
– GB Key Trends
– ROI Retailer Evaluation
>
– GB Retailer Evaluation
© Kantar Worldpanel
Long-Term Share of Till Roll Grocers
34
32
30
28
26
22
20
18
16
14
12
10
8
6
4
2
Tesco
Asda
Sainsbury's
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
0
1993
Share (Expenditure)
24
Morrisons Total
© Kantar Worldpanel
© Kantar Worldpanel
Grocery Share at Round Pound Prices £1/2/3/4 - £%
Iceland
57
Farm Foods
45
Asda
33
Morrisons
26
Tesco
22
The Co-operative
19
Sainsbury's
17
Independents
13
M&S
13
Waitrose
8
Lidl
Aldi
5
3
12 w/e Dec 23 2012
© Kantar Worldpanel
Balance
Value
Values
23-Dec-12
25-Nov-12
28-Oct-12
30-Sep-12
02-Sep-12
05-Aug-12
08-Jul-12
10-Jun-12
13-May-12
15-Apr-12
18-Mar-12
19-Feb-12
22-Jan-12
25-Dec-11
27-Nov-11
30-Oct-11
02-Oct-11
04-Sep-11
07-Aug-11
10-Jul-11
12-Jun-11
15-May-11
17-Apr-11
20-Mar-11
20-Feb-11
Morrisons Share Change - 12 week share year-on-year change
0.2
0.1
0.0
-0.1
-0.2
-0.3
-0.4
-0.5
-0.6
© Kantar Worldpanel
5 key points…
– 1) Positive long term global food possibilities
– 2) Consumers remain cautious in ROI & GB
– 3) GB marketplace more positive
– 4) Fresh Food a major GB growth area
– 5) Know your retailer & find a fit
© Kantar Worldpanel