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ROI GROCERY MARKET REVIEW

ROI GROCERY MARKET REVIEW. Data to 10 th June 2012. OVERVIEW. Market Overview The annual market sales are behind last year, with a decline in market value of 0.1% year-on-year and 0.5% over the shorter term (12 weeks p eriod).

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ROI GROCERY MARKET REVIEW

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  1. ROI GROCERY MARKET REVIEW Data to 10th June 2012

  2. OVERVIEW • Market Overview • The annual market sales are behind last year, with a decline in market value of 0.1% year-on-year and 0.5% over the shorter term (12 weeks period). • The grocery market has shown volume growth of 0.6% year on year and by 0.9 over the 12 week period. • Shoppers are buying more volume but despite price inflation are managing their spend through trading down to own brand, shopping around, shopping to a budget and planning ahead. • Consumers are making more shopping trips, but the average spend per trip has reduced by 3.7%. • Private label continues to be important as a method of reducing spend with a market share at 35%.

  3. The Irish grocery marketis in decline over 52w period by -0.1% and over the 12w period by -0.5%. TOTAL IRISH GROCERY MARKET VALUE AND GROWTH 52 &12 W/E +0.8% -0.1% +0.7% -0.5% 52 & 12 W/e 10 Jun 12

  4. The Irish grocery market is in volume growth over 52w by +0.6% and over 12w by +0.9%. TOTAL IRISH GROCERY VOLUME SALES AND GROWTH 52 &12 W/E -0.7% +0.6% -1% +0.9% 52 & 12 W/e 10 Jun 12

  5. +0.7% +0.3% -3.3% -0.5% +0.4% -2.3% -7.1% TOTAL GROCERY SECTOR VALUE SHARE & GROWTH 52W/E Ambient Food,Fresh Food and Frozen Food sectors continue to increase sales and win share over the full year 52 W/e 10 Jun 12

  6. Ambient Food 29% Fresh & Chilled Produce 47% Household 7% Frozen 5% Toiletries 4% Alcohol 7% Healthcare 1% TOTAL GROCERY SECTOR VALUE SHARE & GROWTH 12W/E Toiletries, Healthcare, and Alcohol sectors have been the driving forces behind value decline Share of total trolley Total Trolley -0.5% value 12 W/e 10 Jun 12

  7. ANALYSIS BY CATEGORY - GROWTH/DECLINE? Canned Goods, Hot Beverages, Fresh Fish and Poultry are some of the stronger performing categories this period. Shoppers continue to spend less on Bathroom Toiletries and Chilled Bakery Products year on year 12w Total Grocery - value %chg by category 12 W/e 10 Jun 12

  8. CHANGE IN INFLATION RATES AND HOUSEHOLD SPEND 12 W/E Household spend change has decreased to -0.59% year on year % change year on year – 12 week period 12 W/e 10 Jun 12

  9. HOW DO SHOPPERS REACT TO INFLATION? – CONSUMER COPING STRATEGIES Shoppers are buying more volume this year. With increased inflation, shoppers are coping by purchasing on promotion and trading down. 12w Total Grocery - consumer coping strategies 12 W/e 10 Jun 12

  10. TRENDED VIEW OF CONSUMER COPING STRATEGIES -12 W/E Buying on offer and trading down has been a key theme for shoppers since the start of 2008 12w Total Grocery - consumer coping strategies trended 12 W/e 10 Jun 12

  11. CHANGES IN CONSUMER SHOPPING BEHAVIOUR 12 W/E Irish households continue to shop more often this year, but spending an average of €0.80 less per trip 12w Total Grocery - changes in consumer shopping behaviour Average frequency increased by +3.2% €7 decrease in 12w spend per HH (-0.6%) Average basket spend reduced by -3.7% 12 W/e 10 Jun 12

  12. 29% 44% 27% 2007 (Under €30) (€30 - €100) (€100+) 35% 45% 20% 2012 KANTAR WORLDPANEL: 52 W/E JUNE 2012

  13. BRANDED VALUE SHARE OF TOTAL IRISH GROCERY MARKETBranded goods losing resonance KANTAR WORLDPANEL: 52 W/E JUNE 2012

  14. PRIVATE LABEL VALUE SHARE OF TOTAL IRISH GROCERY Private Label sales are driving market performance, however value share has fallen since March and is now 35% 12w Total Grocery – PL value% 47% in UK 12 W/e 10 Jun 12

  15. Top 10 growth categories 2007 - 2012 Bakery Home Baking Confectionery Crisps & Snacks Home Cooking Ambient Carbs Hot Beverages Frozen Food Soft Drinks Canned Food KANTAR WORLDPANEL: 52 W/E MAY 2012

  16. UK Market Overview

  17. UK GROCERY SUMMARY • Inflation slowing in UK grocery, household spend also slows, but the market is still in growth year on year. • Own label products grow ahead of branded goods, with own label market share now at 47%. • Shoppers manage spend by buying into own label and trading down price tier.

  18. TOTAL UK MARKET SALES GROWTH 12W/EThe UK market is in 12w/e sales growth of 2% this period while inflation slows to 4.45%. 12 W/e 10 Jun 12 18

  19. UK SHOPPER REACTION Trading down product is key for UK households managing their spend 12 W/e 10 Jun 12

  20. UK GROWTH IN GROCERY PACK SALES BY PRICE BANDWith shoppers seeking to manage their spend in the UK, budget products see a strong increase in sales. Growth in Grocery sales (Packs) Change in sales Share of sales 12 W/e 10 Jun 12

  21. PRIVATE LABEL VS BRANDED YEAR ON YEAR GROWTH – VALUE 12 W/E Own label also sees growth ahead of branded goods over this year 12 W/e 10 Jun 12

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