PMA FRESH CONNECTIONS RETAIL Philadelphia, Pennsylvania April 8-9, - - PowerPoint PPT Presentation

PMA FRESH CONNECTIONS RETAIL

Philadelphia, Pennsylvania

April 8-9, 2015 Brian Numainville Principal, Retail Feedback Group

PRODUCE MARKETING ASSOCIATION

Welcome Panelists

Mary Rita Baby Boomer Jerry Baby Boomer Stephanie Gen X Kate Millennial Antoinette Millennial

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Generations Represented on Panel Today

Baby Boomers: Born Between 1946 – 1964 (51 to 69 in 2015) Generation X: Born Between 1965 – 1980 (35 to 50 in 2015) Millennials: Born Between 1981 – 1997 (18 to 34 in 2015)

Sources: Pew Research Center

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Generation Who: How Do They Research and Make Purchasing Decisions?

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Generation Who: How and Where Do They Shop?

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Generation Who: What Do They Expect From Retailers?

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Putting It All Together: Getting Inside Consumer’s Minds

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The Greatest Generation

Born Before 1928 (88 to 100 in 2015)

Sources: Pew Research Center; Tom Brokaw – “The Greatest Generation”

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The Silent Generation

Born Between 1928 – 1945 (70 to 87 in 2015)

Sources: Pew Research Center; Time magazine

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The Baby Boom Generation

Born Between 1946 – 1964 (51 to 69 in 2015)

Sources: Pew Research Center; Photo – Hudson Valley News Network (hvnn.com)

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Generation X

Born Between 1965 – 1980 (35 to 50 in 2015)

Sources: Pew Research Center; Photo credit – governing.com

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Millennial Generation

Born Between 1981 – 1997 (18 to 34 in 2015)

Sources: Pew Research Center; Graphica

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Gen Z

Born 1998 and later (17 and younger in 2015)

Source: Pew Research Center

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Generations are Unique

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Generations Have Differences in Values

VALUES IN… BUILDERS BOOMERS XERS N-GEN MOTHER

Homemaker Working Mother Single Mother Single Mother/ Father

FAMILY

Close Family Dispersed Family Latchkey Kids Looser Family Structure

MARRIAGE

Married Once Divorced/ Remarried Single Parent Undetermined

HAIR

Short Hair Long Hair Any Style Hair Bleached/ Spiked

CLOTHES

Formal Casual Bizarre Anything Goes

MUSIC

Big Band/ Swing Rock 'n' Roll Alternative, Rap Very Diverse

MONEY

Save It Now Buy It Now Want It Now Get It Now (online)

PURCHASING

Purchase w/ Cash Purchase w/ credit card Struggling to Purchase Purchase Online

MARKETING

Ford Marketing Concept GE Marketing Concept Ignored Market Interactive Global Market

HIGH-TECH

Slide Rule Calculator Computer Internet

WORK STYLE

Team Work Personal Fulfillment Tentative/ Divided Loyalty Networking

WAR

Win a War Why a War? Watch A War Winless War

MORALS

Puritan Ethics Sensual Cautious Tolerant

Source: “Boomers, Xers and Other Strangers” - Dr. Rick & Kathy Hicks

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Population Trends by Generation

Source: Pew Research Center

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Population Trends by Generation

Source: New York Times (nytimes.com), August 21, 2014

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Population Trends by Generation

Source: Nielsen – “Millennials: Breaking the Myths”, January 27, 2014

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Multicultural Population Growth

Source: Nielsen – “The Multicultural Edge: Rising Super Consumers, 2015”

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Food Shopping & Generations

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Average Monthly Grocery Spend & Trips

3.9 ¡ Trips ¡ 4.1 ¡ Trips ¡

Millennials: ¡$252.60 ¡ Silent: ¡$263.70 ¡ Gen ¡X: ¡$323.10 ¡ Boomers: ¡$295.50 ¡

Source: July 2013 Acosta/AMG Strategic Advisors Report – “Four Generations in the Aisle”

3.6 ¡ Trips ¡ 3.6 ¡ Trips ¡

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Drug ¡ ¡ & ¡ ¡ Dollar ¡ Grocery ¡ ¡ & ¡ ¡ Club ¡ Grocery ¡ ¡ & ¡ ¡ Dollar ¡ Club ¡ & ¡ Drug ¡

Channel Preference - Making More Trips To:

Millennial

Gen X Baby Boomer Silent

Source: July 2013 Acosta/AMG Strategic Advisors Report – “Four Generations in the Aisle”

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22% 19% 16% 11% 27% 27% 25% 15% 37% 32% 33% 20% 45% 39% 35% 22%

Seniors Boomers Gen X Millennials

Cost Consciousness of Generations

Gen ¡X ¡is ¡a ¡cost ¡ conscious ¡generaGon ¡ and ¡careful ¡about ¡ their ¡purchases, ¡just ¡ slightly ¡less ¡than ¡

• Millennials. ¡ ¡

Buy Brands

• n Sale

Rather than Preferred Brand Select Products to Create Meals at Lowest Cost Choose Products Based on Loyalty Card Discounts Steer Clear

• f Certain

Aisles to Avoid Unplanned Purchases

Source: SymphonyIRI Press Release – October 23, 2012

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% Buying More Store Brands to Save Money

26% ¡

Silent ¡GeneraGon ¡

36% ¡

Baby ¡Boomers ¡

41% ¡

Gen ¡X ¡

42% ¡

Millennials ¡ Private ¡Label ¡Growing… ¡

Source: July 2013 Acosta/AMG Strategic Advisors Report – “Four Generations in the Aisle”

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Boomers & Grocery Spending

“As a result, younger Boomers outspend Millennials by nearly $8,000 annually and the typical consumer by $5,000, with spending occurring across most categories. Boomers will control more than half of all dollars spent on grocery foods this year, with a particular focus on health and wellness.” – Progressive Grocer, March 18, 2015

Sources: Fung Business Intelligence Centre (FBIC) publication: “Profiting from a Graying America”; Quote - Progressive Grocer

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Gen X – Smart About Researching

55% of Gen-Xers download recipes off websites and other online sources 52% download coupons from manufacturer websites 51% download coupons from retailer websites 51% download coupons from couponing sites, such as SmartSource 38% research products online 35% visit deal sites, such as Woot and Groupon 31% use social media sites, such as Twitter and Facebook, to get coupons 23% look for updates from retailers/manufacturers via email/text message 18% research products on blogs 7% purchase groceries online and have them delivered

Source: SymphonyIRI Press Release – October 23, 2012

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When is the Supermarket Shopping List Made?

0% 50% 100% Matures Boomers Gen X Milennials 21% 27% 29% 37% 59% 50% 46% 32%

Right Before Going to the Store Throughout the Week in Between Trips as Items Run Out Some Other Time

Source: Food Marketing Institute: “U.S. Grocery Shopper Trends, 2014” n=2116.

Millennials are more likely to make their list right before shopping versus the other generations who build list during their lists during the week.

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68% 50% 18% 31% 70% 47% 21% 34% 67% 42% 31% 35% 66% 37% 36% 43%

Matures Boomers Gen X Millennials

Generations and Shopping List Inspiration

Planning ¡for ¡a ¡ shopping ¡trip ¡for ¡ Millennials ¡centers ¡

• n ¡planning ¡meals ¡

and ¡checking ¡recipes ¡ versus ¡other ¡ generaGons ¡more ¡ likely ¡to ¡check ¡ specials ¡and ¡stock ¡

• up. ¡

Source: Food Marketing Institute” “U.S. Grocery Shopper Trends, 2005-2014” - 2014 n=2116.

Checking Stock Checking Specials Planning Meals Checking Recipes

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Fresh Foods on Growth Trajectory

According to NPD's "The Future of Eating: Who's Eating What in 2018”: Fresh foods – such as fruits, vegetables, meat, poultry, fish and eggs – will play an even more central role in all three main meal occasions over the next five years. The consumption of fresh foods grew by 20 percent to more than 100 billion from 2003-2013, a trend driven primarily by Generation Z and Millennials, The NPD Group found.

Source: Progressive Grocer, December 9, 2014

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Millennial Taste for Fresh Foods

Source: The Atlantic – “How Millennials Spend” - September 8, 2014

Note ¡the ¡rank ¡and ¡ self-­‑reported ¡ increases ¡for ¡fresh ¡ fruits/vegetables, ¡

• rganic ¡food ¡and ¡

natural ¡products ¡in ¡ the ¡next ¡twelve ¡

• months. ¡ ¡

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Natural/Organic Food Products: Millennials versus Boomers

Source: www.eMarketer.com & original sources

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Floral Generational Differences

Boomers ¡ Gen ¡X ¡ Millennials ¡

Higher ¡appreciaGon ¡of ¡ flowers ¡and ¡most ¡likely ¡to ¡ agree ¡with ¡emoGonal ¡ aspects ¡of ¡flowers ¡ ¡ Half ¡use ¡Internet ¡to ¡send ¡ flowers ¡out ¡of ¡area ¡ ¡ Highest ¡expectaGons ¡of ¡ florists ¡and ¡most ¡likely ¡to ¡ view ¡cost ¡as ¡a ¡purchase ¡ barrier ¡ Less ¡appreciaGon ¡of ¡ flowers ¡than ¡Boomers ¡ and ¡more ¡emoGonally ¡ connected ¡to ¡flowers ¡ than ¡Millennials ¡ ¡ Most ¡likely ¡to ¡purchase ¡

• ver ¡Internet ¡

¡ Most ¡likely ¡to ¡purchase ¡ flowers ¡as ¡tradiGonal ¡ holiday/occasion ¡giZ, ¡a ¡ “just ¡because” ¡pick-­‑me-­‑ up ¡giZ ¡and ¡for ¡decoraGon ¡ Significantly ¡less ¡likely ¡to ¡ have ¡a ¡high ¡appreciaGon ¡

• f ¡flowers ¡or ¡other ¡

emoGonal ¡aspects ¡ associated ¡with ¡giZ ¡of ¡ flowers ¡ ¡ Most ¡likely ¡to ¡purchase ¡ in ¡person ¡and ¡deliver ¡ themselves ¡ ¡ Most ¡likely ¡to ¡purchase ¡ flowers ¡to ¡impress ¡ guests ¡to ¡their ¡home ¡

Source: SAF “Generations of Flowers Research Study, 2009.”

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Online Spending

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Share of Income Spent Online

Source: Business Insider, January 26, 2015

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Time & Money Spent Online Annually

Source: Business Insider, January 26, 2015

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What do Millennials Buy Online?

Source: 2014 PLMA Consumer Research: “The Millennials Are Coming”

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Smartphones

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Millennials: Smartphone Use by Channel

Source: www.eMarketer.com & original sources

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Mobile Devices for Grocery Purchases: Millennials versus Boomers

Source: www.eMarketer.com & original sources

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Social Media & Selfies

Source: Pew Research Center

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The Future: Millennials

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Millennials

1 – They aren’t influenced at all by advertising 2 – They would rather buy a car and lease a house 3 – They review blogs before making a purchase 4 – They value authenticity as more important than content 5 – Their future inheritance won’t change their buying behavior 6 – They want to engage with brands on social networks 7 – They want to co-create products with companies 8 – They are using multiple tech devices 9 – They are brand loyal (IF a relationship, otherwise not) 10 – They expect brands to give back to society

Source: Elite Daily / Forbes Study of 1,300 Millennials, January 20, 2015

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What Matters to Millennials When Shopping?

Source: 2014 PLMA Consumer Research: “The Millennials Are Coming”

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Influences on Millennial Brand Selection

Source: www.eMarketer.com & original sources

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Social Responsibility Important to Millennials

Companies have a moral obligation to add value Millennials are talking about companies that support causes Millennials will show you the money Millennials want to work for you if you support a cause they care about

Source: TBWA\Worldwide Press Release, November 19, 2012

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Conclusion

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SPENDING POWER TODAY FRESH FOODS FLORAL

Millennial

Gen X

Baby Boomer Silent

BRAND LOYALTY SUPERMARKET CHANNEL RELEVANCE

Source: Retail Feedback Group Assessment 2015

TECHNOLOGY & SOCIAL MEDIA

ASSESSMENT

VALUE FOCUS

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PMA FRESH CONNECTIONS RETAIL

Philadelphia, Pennsylvania

April 8-9, 2015 Brian Numainville Principal, Retail Feedback Group