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IRI 2013 Performance Review
 

IRI 2013 Performance Review

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IRI's 2013 Review of the US Marketplace

IRI's 2013 Review of the US Marketplace

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    IRI 2013 Performance Review IRI 2013 Performance Review Presentation Transcript

    • 1 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.1 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.Times & TrendsFebruary 2013Finding the New NormalCPG Year in Review:
    • 2 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.2 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.Executive SummaryINSIGHT ACTIONOn average, CPG unit sales slippedslightly in 2012, and dollar sales growthwas driven largely by inflation; groceryand drug channel performance laggedindustry average, while the conveniencechannel was relatively strongLeverage frequent and granular marketassessments to maintain a clearunderstanding of economic, channeland consumer shifts, and use thatknowledge to align marketing programsand/or re-align on-the-fly, as neededInvest to develop and maintain a 360-degree understanding of your mostimportant shoppers, then developproducts and/or highly targetedmarketing programs that are gearedtoward protecting and growing share andloyalty among these best shoppersDevelop and prominently tout a valueproposition founded on the needs andwants of primary and high-growthconsumer segmentsCategories that support key consumerrituals, such as self-driven health andbeauty care and home-based eating,were among the strongest-performingcategories in 2012Trends around channel shifting point toa redirecting of CPG spending to fewerchannels, specifically those thatconsumers perceive as offering thegreatest value
    • 3 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.3 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.INSIGHT ACTIONExecutive SummaryPrivate label is experiencing pockets ofgrowth across channels anddepartments, but national brands arequite competitive and dominating inother areas National and private label marketersmust look for opportunities to developproducts across the value spectrum todrive appeal across a broad range ofconsumers and align attributes, pricingand messaging closely to the needsand wants of the target audienceThe future of the CPG industry is beingshaped by a variety of interdependentfactors, including a changingdemographic landscape, new andevolving technologies and a nascentpost-recession economyConstantly re-evaluate marketingprograms based on evolving marketconditions to ensure ongoing relevanceand maximize impact
    • 4 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.4 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.The United States economy is showing signs of positive momentum but severalhurdles threaten to quickly derail the recovery, tempering expectations for a stronggrowth in 2013.Economic Measure 2008 2009 2010 2011 2012 2013PGDP (% chg) 1.9% -2.2% 3.8% 4.0% 4.1% 4.1%Unemployment (%, SA) 5.8 9.3 9.6 8.9 8.1 7.7Consumer Price Inflation (% Chg) 3.8% -0.3% 1.6% 3.1% 2.1% 2.1%Retail Sales (% Chg) -1.2% -7.1% 5.5% 8.0% 4.9% 3.1%Residential Permits, Total (Mil)3.6 2.3 2.4 2.5 3.2 4.8Economic Snapshot2008-2013PSource: Moody’s Economy January 2013
    • 5 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.5 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.In 2012, CPG industry unit sales trends were was largely flat, but channel level trendsvaried, with the convenience channel standing out as a top performer.CPG Industry Growth Trends: Dollar & Unit SalesMulti-Outlet + Convenience and by Channel2012 & 2011Source: SymphonyIRI Market Advantage™; 52 weeks ending 12/30/2012 and same period prior year
    • 6 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.6 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.The grocery channel lost more than one-half share point in 2012, driven by amigration to value channels, including mass merchandise, supercenter and dollarstores.CPG Dollar Share Shifts by ChannelChannel Share2012Share PointChange2012 vs. 2011GroceryDrugConvenience40.7%6.6%18.2%(0.7)(0.1)0.02011 vs. 2010(0.5)0.0+0.1Source: SymphonyIRI Consumer Network™; 52 weeks ending 1/13/2013 and sameperiod prior yearBuy RateVolume Sales Per 1,000 Households, % Chg2012 vs. 2011By Channel* Excludes WalmartSource: SymphonyIRI Market Advantage™; 52 weeks ending 12/30/2012 and sameperiod prior year
    • 7 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.7 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.Healthcare department sales outpaced industry average and surrounding departmentsby a wide margin in 2012.Sales Trends by Department% Change versus Year AgoMulti-Outlet + Convenience2012 vs 2011Source: SymphonyIRI Market Advantage™; 52 weeks ending 12/30/2012 and same period prior year
    • 8 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.8 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.Drug channel performance lagged industry average across most departments in2012.Source: SymphonyIRI Market Advantage™; 52 weeks ending 12/30/2012 and same period prior yearUnit Sales Trends by Department% Change versus Year AgoMulti-Outlet + Convenience versus Drug2012 vs 2011
    • 9 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.9 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.Performance across top CPG categories is split with half outperforming industryaverage and the other half lagging.(9.1%)+3.4%(1.1%)+2.6%+1.5%+3.2%+3.0%+1.4%+1.3%+6.3%Average PriceChange** vs. YATop 10 Categories* Dollar & Unit Sales% Change versus Year AgoMulti-Outlet + Convenience2012 vs. 2011*Based on multi-outlet dollar sales. ** **Average price change based on price per volume analysis.Source: SymphonyIRI Market Advantage™; 52 weeks ending 12/30/2012 and same period prior year
    • 10 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.10 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.A majority of the fastest-growing CPG categories satisfy consumers’ quests for on-the-go satiation, and beverages are well-represented in the ranks of strong performers.(9.1%)+2.9%+2.5%+1.6%+3.9%+1.0%+11.4%+5.2%+3.4%+4.3%Average PriceChange** vs. YATop 10 Growth CategoriesBased on Unit Sales % Change versus Year AgoMulti-Outlet + Convenience2012 versus 2011*Based on multi-outlet dollar sales. ** **Average price change based on price per volume analysis.Source: SymphonyIRI Market Advantage™; 52 weeks ending 12/30/2012 and same period prior year
    • 11 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.11 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.Four of the top 10 healthcare categories outperformed department average in2012.Top 10* Healthcare CategoriesUnit Sales % Change versus Year AgoMulti-Outlet + Convenience2012 versus 2011Average PriceChange** vs. YA*Based on multi-outlet dollar sales. ** **Average price change based on price per volume analysis.Source: SymphonyIRI Market Advantage™; 52 weeks ending 12/30/2012 and same period prior year+2.9%+1.5%+5.2%+2.3%(0.9%)+4.3%(0.5%)+9.8%+0.1%+0.5%
    • 12 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.12 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.A majority of top beauty and personal care categories experienced unit sales declinesduring 2012, despite the fact that the department as a whole saw a small growthuptick.Top 10* Beauty/Personal Care CategoriesUnit Sales % Change versus Year AgoMulti-Outlet + Convenience2012 versus 2011+0.8%+2.1%+1.2%+0.9%+4.3%+6.2%+3.3%N/A***+2.9%+2.0%*Largest categories, based on dollar sales. **Average price change based on price per volume analysis. ***Because a number of different volumeequivalencies are present within this category, volume measures are not available.Source: SymphonyIRI Market Advantage™; 52 weeks ending 12/30/2012 and same period prior yearAverage PriceChange** vs. YA
    • 13 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.13 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.Price increases across some CPG categories were significantly higher than theindustry average rate of inflation of 2.5%.*Among top 100 SymphonyIRI Reviews categories, based on price per volume analysis.Categories with the Largest Price Increases*Multi-Outlet + Convenience2012 versus 2011Source: SymphonyIRI Market Advantage™; 52 weeks ending 12/30/2012 and same period prior year
    • 14 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.14 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.Private label share is highest in grocery, and share growth trends varying acrosschannels and departments.2012 CPG Private Label Share by ChannelDollarPrivate Label SharePoint Change vs. 2011Unit0.0+0.50.00.0(0.1)+0.3(0.1)(0.2)Source: SymphonyIRI Market Advantage™; 52 weeks ending 12/30/2012 and same period prior year2012 CPG Private Label Share by DepartmentMulti-Outlet + Convenience(0.4)+0.8+0.2(0.4)+0.10.0Private Label SharePoint Change vs. 2011(0.2)+0.7+0.1(1.0)0.0(0.2)Dollar UnitSource: SymphonyIRI Market Advantage™; 52 weeks ending 12/30/2012 and same period prior year
    • 15 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.15 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.Private label share trends across high price increase categories were mixed, withshare slides attributable to national brand efforts to elevate their value proposition aswell as new product innovation.2012 CPG Private Label ShareAmong High Price Increase CategoriesMulti-Outlet + Convenience(1.2)+0.6(0.2)+0.1(0.1)+1.4+0.1(1.1)(0.1)(0.1)(1.9)+0.7(0.1)(1.1)0.0+2.2(0.5)(1.1)+0.5(0.7)Private Label SharePoint Change vs. 2011Dollar UnitSource: SymphonyIRI Market Advantage™; 52 weeks ending 12/30/2012 and same period prior year
    • 16 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.16 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.Though overall trip behavior has slowed during the past several years, trips to severalvalue channels increased during 2012.All Outlet Average Tripsper Shopper per Month2013 Average Trips per Shopper per MonthBy Channel* Excludes Walmart% changeversus 2012Source: SymphonyIRI Consumer Network™, 52 weeks ended 1/13/2013 and sameperiod prior years(2.0%)(2.7%)+0.2%+0.7%(2.3%)+0.7%Source: SymphonyIRI Consumer Network™, 52 weeks ended 1/13/2013 and sameperiod prior years
    • 17 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.17 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.Trends around number of channels shopped are hinting at a world where consumerslimit their spending to fewer channels and select those that offer the greatest value.% of Consumers Shopping Multiple ChannelsBy # of CPG Channels Shopped2011-2012Source: SymphonyIRI Consumer Network™
    • 18 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.18 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.Source: SymphonyIRI MarketPulse Survey Q4 2012Influence of Internet on Brand Decisions% of Shoppers - Top 2 BoxThe Internet already plays an integral role in helping consumers make smart choices,particularly among the nation’s youngest shoppers.
    • 19 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.19 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.Identify opportunities andrisksEvaluate pricing andpromotional strategiesEnhance new productdevelopment initiativesConclusions: Manufacturers Closely track the evolvingcompetitive set at the channel andretailer level, including the traditionalbrick-and-mortar markets as well asonline arena, to ensure appropriatealignment of distribution strategies Use value-oriented pricing andpromotion programs to protect andgrow share, particularly acrosscategories that demonstrate strongand/or growing store brand presence Monitor technological advanceswithin and outside the CPGenvironment; be on the lookout fornew and innovative opportunities toreach and resonate with keyconsumers Invest to understand trends aroundpackaging/pack size shifts acrossyour category’s/brand’s mostimportant shoppers to ensure yourproducts are aligned properly Continually re-assess and adjustpricing to maintain optimal price gapbetween private label and namebrand offerings Adopt everyday pricing strategiesthat underscore your valueproposition, and rely on promotionalpricing to address short-term tacticalopportunities Constantly evaluate productdevelopment opportunities at bothends of the product spectrum,including those that address keyconsumer trends Explore opportunities to partner withkey retailers to developcomplementary national and privatebrand assortments across keycategories to address the goals ofcore shoppers, retailer partners andyour own corporate objectives
    • 20 Copyright © SymphonyIRI Group, 2010. Confidential and Proprietary.20 Copyright © SymphonyIRI Group, 2013. Confidential and Proprietary.Conclusions: Retailers Closely track the evolving competitiveset at the channel and retail bannerlevel, including the traditional brick-and-mortar markets as well as online arena,to ensure appropriate alignment ofassortment strategies Use value-oriented pricing andpromotion programs to protect andgrow share, particularly acrosscategories that are most closely alignedwith the needs and wants of keyshoppers Monitor technological advances withinand outside the CPG environment; beon the lookout for new and innovativeopportunities to reach and resonatewith key shoppers Invest to understand trends aroundpackaging/pack size shifts acrossyour category’s/brand’s mostimportant shoppers to ensure yourassortments are aligned properly Adopt everyday pricing strategiesthat underscore your valueproposition, and rely on promotionalpricing to address short-term tacticalopportunities Constantly evaluate private labelproduct development opportunities atboth ends of the product spectrum,including those that address keyconsumer trends Explore opportunities to partner withkey manufacturers to developcomplementary national and privatebrand assortments across keycategories to address the goals ofcore shoppers, manufacturerpartners and your own corporateobjectivesIdentify opportunities andrisksEvaluate pricing andpromotional strategiesEnhance new productdevelopment initiatives