Workshop : CSM & Fonterra                                              Creating Value                                     ...
Agenda Workshop  Objectives:   To identify potential opportunities for joint product development;   Using our dairy ingr...
Agenda Workshop  10:30 – 11:00 : Introduction  11:00 – 11:30 : CSM: Profile & Strategy  11:30 – 12:00 : Fonterra: Profile ...
Agenda Workshop  10:30 – 11:00 : Introduction  11:00 – 11:30 : CSM: Profile & Strategy  11:30 – 12:00 : Fonterra: Profile ...
Agenda Workshop  10:30 – 11:00 : Introduction  11:00 – 11:30 : CSM: Profile & Strategy  11:30 – 12:00 : Fonterra: Profile ...
Fonterra – Global Snapshot                             6
The natural source of dairy nutrition for  everybody, everywhere, every day                                7           7
As the world’s largest dairy ingredients company wesource, partner and supply globally to our customersSell ingredients i...
World leading expertise in unlocking the naturalgoodness of dairyInnovation & expertise • One of the world’s largest   inv...
Core research in New Zealand; application work attechnical centres close to our customers & consumers                     ...
Fonterra Europe – Strategic Change                                     11
Our European headquarter is in Amsterdam                  THE NETHERLANDS    Fonterra (Europe) Cooperative U.A.:          ...
Refocusing our European business model                   From a tactical                                  …to a valued    ...
Fonterra’s Approach                      14
Innovation Programmes are built on 4 pillars: Delivering                 Best nutrition better for you             for mot...
Our ingredients deliver optimal nutrition,  without compromising taste and texture Same                                   ...
What we learned : CSM’s Innovation Strategy Focus on Health and Nutrition  Eliminate undesirable components and ingredien...
Recent Studies:The way we work   UK                  France                  Germany                  Spain           ...
Fonterra believes in Partnership                                   19
Agenda Workshop  10:30 – 11:00 : Introduction  11:00 – 11:30 : CSM: Profile & Strategy  11:30 – 12:00 : Fonterra: Profile ...
Agenda Workshop  10:30 – 11:00 : Introduction  11:00 – 11:30 : CSM: Profile & Strategy  11:30 – 12:00 : Fonterra: Profile ...
Recap: The way we work                         22
Subjects    Consumer trends in food    Consumer & Market trends    Looking insiGHT consumers’ lives    Dairy ingredients a...
Consumer trends                       What is on consumers mind?                                               is this a g...
Increasing health consciousness among consumerdrives them into naturally healthy & better-for-you food• Fonterra sees 5 ke...
The increased health awareness/ consciousness sees Weight wellness & linked with health issues                            ...
New Nutrition Business recognize trends in “Better- for-you” area & see opportunities in bakery & dairy                   ...
Possibility for “Health Halo” combining good grains with dairy “Good grains” and “dairy (protein)” are linked in consumers...
Market facts                    what are the latest NPD’s?                                           how big is this marke...
Naturally healthy & Better-for-you food drives growth of naturally healthy foods                                  European...
Good news: new EU food labelling rules support consumers in making better informed, healthier purchase decisions          ...
NPD trends :Consumers’ “Better-for-you” needs causes Protein to pop up as a key trend                                     ...
Multiple examples of these “Better-for-you” products in bakery                                                            ...
European Consumer Insights                   why does (s)he eat that?                                              can she...
What consumers eat when and why in Europe Despite difference, there are some consistencies in meal occasions and what  ben...
What consumers want from their food difference during the dayFood satisfies different needs during the cause of the day.  ...
Example: The snacking paradox (BFY)• Consumers believe they should not eat anything in-between. However, they do.• So it s...
Example: Getting all you need in an easy way (GFY)• Consumers want to have something in the morning that can keep them goi...
Protein knowledge consumers • ~20% is prepared to pay more for protein enhanced products • Knowledge about protein increas...
Agenda Workshop  10:30 – 11:00 : Introduction  11:00 – 11:30 : CSM: Profile & Strategy  11:30 – 12:00 : Fonterra: Profile ...
Technical expertise                      how does protein work?                                           how much protein...
How does it work: Protein – the building block                                                               •   An organi...
Muscle is key…                                                  • Largest tissue in the human body                        ...
Dairy protein, particularly whey, provides optimal build        ....                                                      ...
Fonterra Nutrition goal is to …..Improve the nutritional balance of foods to aid in healthier lifestyle –Substituting for...
Agenda Workshop  10:30 – 11:00 : Introduction  11:00 – 11:30 : CSM: Profile & Strategy  11:30 – 12:00 : Fonterra: Profile ...
Let’s have a look, feel & taste    Hand-outs    Tasting Session                                  49
Example 1: Granola BarImprove body tone, stay mobilelonger, re-energises without thesugars/fatsHelps to build and maintain...
Example 2: Chocolate Brownie (glutenfree) Reduces the risk of allergy Fits in a gluten free dietDoes not contain glutenPow...
Example 3: Chocolate Muffin (eggfree  Reduces allergies and risk; helps  to prevent high cholesterol  and has 50% choleste...
Example 4: Yellow Cake (Buttermax  Helps prevent obesity,  cardiovascular disease and  diabetics.Less saturated fat; Healt...
Different consumer benefits (claims) can dairy provide  tackling the consumer needs in the better-for-you area    Consumer...
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Csm consumer & market insight final

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  • Before giving some key insights into healthy aging that we found, I will first give a very short background to Fonterra and the new way of working in Fonterra.
  • Before giving some key insights into healthy aging that we found, I will first give a very short background to Fonterra and the new way of working in Fonterra.
  • Now why do consumers eat certain things at different moments of the day. First – what are the consumers trends in terms of need in general.Do you have examples of your business where one of these trends play a role?
  • Deep dive into one of these “better for you” trend – weight wellness. This is the healthy & wellness needs that they know of because they notice them, or heard about it in the media.
  • that cover both the bakery and dairy market landscape in 2012
  • Strong natural image: Grains benefi t from a consumer perception of being “all-natural” and least-processed. Evenhighly-processed grain-based foods, such as breakfast cereals, have a strong naturally healthy image in consumers’ mindsand many grains benefi t from a perception of a natural and intrinsic health benefi t – such as oats and heart health.• New life for “slow energy”: The large Diogenes weight management study has given renewed life to the conceptsof Low GI and “sustained energy” – which is likely to accelerate the trend to use whole grains in product formulation.Because of the quality and scale of the study it is already having an impact on food marketing.
  • Why protein is key in this, we will explain in a second under “technical expertise”. Seniors: Illustration of high-need group
  • Before giving some key insights into healthy aging that we found, I will first give a very short background to Fonterra and the new way of working in Fonterra.
  • Breakfast> sandwiches, or yoghurt with muesli or milk with cereal in it, coffee & tea
  • I mentioned early that bakery and a lot of dairy products are mainly eaten as a snack  let’s look further into what consumers eat when and why.GFY, BFY : Options in CycleTo CSM: Where do you see opportunities? Where are your needs?Amount of calories consumers allow themselves increases during the day.Also the function/ role of food become much more emotional during the day. From wanting something right for your body/ nutritious in the morning to an indulgence moment at the end of the day.
  • I mentioned early that bakery and a lot of dairy products are mainly eaten as a snack  let’s look further into what consumers eat when and why.Amount of calories consumers allow themselves increases during the day.Also the function/ role of food become much more emotional during the day. From wanting something right for your body/ nutritious in the morning to an indulgence moment at the end of the day.
  • I mentioned early that bakery and a lot of dairy products are mainly eaten as a snack  let’s look further into what consumers eat when and why.Amount of calories consumers allow themselves increases during the day.Also the function/ role of food become much more emotional during the day. From wanting something right for your body/ nutritious in the morning to an indulgence moment at the end of the day.
  • I mentioned early that bakery and a lot of dairy products are mainly eaten as a snack  let’s look further into what consumers eat when and why.
  • I mentioned early that bakery and a lot of dairy products are mainly eaten as a snack  let’s look further into what consumers eat when and why.
  • I mentioned early that bakery and a lot of dairy products are mainly eaten as a snack  let’s look further into what consumers eat when and why.
  • I mentioned early that bakery and a lot of dairy products are mainly eaten as a snack  let’s look further into what consumers eat when and why.
  • Csm consumer & market insight final

    1. 1. Workshop : CSM & Fonterra Creating Value for our Consumers Together Amsterdam, 1th of February 2012 1
    2. 2. Agenda Workshop Objectives:  To identify potential opportunities for joint product development;  Using our dairy ingredients in your bakery applications  In the areas of “Better For You” and/or “Good for You”. 2
    3. 3. Agenda Workshop 10:30 – 11:00 : Introduction 11:00 – 11:30 : CSM: Profile & Strategy 11:30 – 12:00 : Fonterra: Profile & Strategy 12:00 – 13:00 : LUNCH 13:00 – 13:30 : Looking insiGHT consumers’ 13:30 – 14:00 : Dairy ingredients: a taste, texture & nutrition solution 14:00 – 15:00 : Illustrations 15:00 – 15:30 : Conclusions & Next Steps 15:30 : Closure 3
    4. 4. Agenda Workshop 10:30 – 11:00 : Introduction 11:00 – 11:30 : CSM: Profile & Strategy 11:30 – 12:00 : Fonterra: Profile & Strategy 12:00 – 13:00 : LUNCH 13:00 – 13:30 : Looking insiGHT consumers’ 13:30 – 14:00 : Dairy ingredients: a taste, texture & nutrition solution 14:00 – 15:00 : Illustrations 15:00 – 15:30 : Conclusions & Next Steps 15:30 : Closure 4
    5. 5. Agenda Workshop 10:30 – 11:00 : Introduction 11:00 – 11:30 : CSM: Profile & Strategy 11:30 – 12:00 : Fonterra: Profile & Strategy 12:00 – 13:00 : LUNCH 13:00 – 13:30 : Looking insiGHT consumers’ 13:30 – 14:00 : Dairy ingredients: a taste, texture & nutrition solution 14:00 – 15:00 : Illustrations 15:00 – 15:30 : Conclusions & Next Steps 15:30 : Closure 5
    6. 6. Fonterra – Global Snapshot 6
    7. 7. The natural source of dairy nutrition for everybody, everywhere, every day 7 7
    8. 8. As the world’s largest dairy ingredients company wesource, partner and supply globally to our customersSell ingredients in over 100 countriesProcess 50+ billion lbs of milk per yearManage more than 40% of global dairy trade 8
    9. 9. World leading expertise in unlocking the naturalgoodness of dairyInnovation & expertise • One of the world’s largest investors in dairy innovation – current R&D investment of NZ$86m per year • Backed by 83 years of experience • Research centre , pilot plant and four in-market technical centres close to customers • More than 400 scientists and support staff based at the Fonterra Research Centre alone 9
    10. 10. Core research in New Zealand; application work attechnical centres close to our customers & consumers Amsterdam, Tokyo, Netherlands Japan Palmerston North, NZ Chicago, Melbourne, USA Australia 10
    11. 11. Fonterra Europe – Strategic Change 11
    12. 12. Our European headquarter is in Amsterdam THE NETHERLANDS Fonterra (Europe) Cooperative U.A.: Amsterdam 65 staff RUSSIA Fonterra (CIS): UK MoscowFonterra (Logistics): 4 staff Swindon 3 staff ITALY Fonterra Italy: FRANCE Veneto Paris branch: 10 staff 1 staff 12
    13. 13. Refocusing our European business model From a tactical …to a valued commodity player… ingredients partner Transactional relationships A strategic relationships Strategic approach to Transactional relationships Strategic partners relationships A different Commodity / Commodity+ Commodity / Value-add Mostly Butter & Cheese Commodity+ portfolio ofproducts and Value-add Quota Quota solutionsA mix of ex-NZ NZ sourced sourced Europeand domestic NZ sourced Europe sourcing sourced 13
    14. 14. Fonterra’s Approach 14
    15. 15. Innovation Programmes are built on 4 pillars: Delivering Best nutrition better for you for mother convenient food and child Enabling the aging Controlling unhealthy to maintain healthy, cravings to address active lifestyles the overweight epidemic 15
    16. 16. Our ingredients deliver optimal nutrition, without compromising taste and texture Same Better for You Match flavor Salt Sugar Match texture Fat Natural/ Additives authentic taste Protein New flavor Fiber Probiotics New texture Prebiotics (eg. GoS)Differentiated Good For You 16
    17. 17. What we learned : CSM’s Innovation Strategy Focus on Health and Nutrition  Eliminate undesirable components and ingredient levels o Trans fats and salt o Reduced caloric density o More well-balanced Health: Match !  "Better for You“: improve nutrient profiles  “Good for You“: create products designed for specific nutritional needs Nutrition:  Support intestinal health  Help to manage body weight; offer healthier choices 17
    18. 18. Recent Studies:The way we work UK France Germany Spain Russia 18
    19. 19. Fonterra believes in Partnership 19
    20. 20. Agenda Workshop 10:30 – 11:00 : Introduction 11:00 – 11:30 : CSM: Profile & Strategy 11:30 – 12:00 : Fonterra: Profile & Strategy 12:00 – 13:00 : LUNCH 13:00 – 13:30 : Looking insiGHT consumers’ 13:30 – 14:00 : Dairy ingredients: a taste, texture & nutrition solution 14:00 – 15:00 : Illustrations 15:00 – 15:30 : Conclusions & Next Steps 15:30 : Closure 20
    21. 21. Agenda Workshop 10:30 – 11:00 : Introduction 11:00 – 11:30 : CSM: Profile & Strategy 11:30 – 12:00 : Fonterra: Profile & Strategy 12:00 – 13:00 : LUNCH 13:00 – 13:30 : Looking insiGHT consumers’ 13:30 – 14:00 : Dairy ingredients: a taste, texture & nutrition solution 14:00 – 15:00 : Illustrations 15:00 – 15:30 : Conclusions & Next Steps 15:30 : Closure 21
    22. 22. Recap: The way we work 22
    23. 23. Subjects Consumer trends in food Consumer & Market trends Looking insiGHT consumers’ lives Dairy ingredients as a taste, texture & nutrition solution 23
    24. 24. Consumer trends What is on consumers mind? is this a growing worry? what do consumers find important?what benefits are more and more out there? what concerns & worries do consumers have? 24
    25. 25. Increasing health consciousness among consumerdrives them into naturally healthy & better-for-you food• Fonterra sees 5 key global consumer trends;• Increased consumer health consciousness is the main force 25
    26. 26. The increased health awareness/ consciousness sees Weight wellness & linked with health issues Top of Minds health & wellness concerns • High cholesterol • Cardiovascular diseases • Immobility • Diabetics • Good digestion • Osteoporosis • Balanced nutrition Weight is the key indicator for being healthy 26Source: Euromonitor, New nutrition business
    27. 27. New Nutrition Business recognize trends in “Better- for-you” area & see opportunities in bakery & dairy 10 Key Trends in Food, Nutrition & Health 2012 better-for-you Naturality Movement better-for-you Energy Senior nutrition better-for-you better-for-you Digestive health Fruit & Vegetables Feel the benefit Dairy better-for-you Weight management Good grains 27Source: New Nutrition Business, 10 Key Trends in Food, Nutrition & Health 2012
    28. 28. Possibility for “Health Halo” combining good grains with dairy “Good grains” and “dairy (protein)” are linked in consumers mind with similar benefits Strong “naturally healthy” image Sustained/ slow energy (Low GI / protein) Link to specific health benefits consumers look for – i.e. cholesterol- lowering, satiety 28Source: New Nutrition Business, 10 Key Trends in Food, Nutrition & Health 2012
    29. 29. Market facts what are the latest NPD’s? how big is this market? who is influencing these trends?what products are out there? is this market growing? 29
    30. 30. Naturally healthy & Better-for-you food drives growth of naturally healthy foods European Health & Wellness market is a $166 billion market and growing $51 $66 MARKET + 11% 30Source: Euromonitor
    31. 31. Good news: new EU food labelling rules support consumers in making better informed, healthier purchase decisions REGULATORY Nutritional labelling becomes mandatory in 2014 Minimum font sizes will be regulated Implications for manufacturers:• Labels will spell out; in a way easy for consumers to read• Increased nutritional transparency may influence food choices Good news for healthy convenient bakery products 31Source: Euromonitor
    32. 32. NPD trends :Consumers’ “Better-for-you” needs causes Protein to pop up as a key trend 32Source: Innova: Trends 2012
    33. 33. Multiple examples of these “Better-for-you” products in bakery Slow released energy Probake biscuits provide protein that’s easy for elderly consumers to eat. Satisfies hunger longer Natural energy Muffins with only 100kcal each Gluten-free oat cakes 33Source: Mintel NPD database, Foodnavigator.com, new Nutrition Business 2012
    34. 34. European Consumer Insights why does (s)he eat that? can she find what she want? what does like at what moment of when does (s)he eat the day? that? what does (s)he eat? 34
    35. 35. What consumers eat when and why in Europe Despite difference, there are some consistencies in meal occasions and what benefits consumers look for.       35Source: Consumer Deep Dives Fonterra pan-Europe, August 2011
    36. 36. What consumers want from their food difference during the dayFood satisfies different needs during the cause of the day. Low sugar Taste Good for you Low fat Better for you       Better for you Low calorie No additives Texture Naturalness 36Source: Consumer Deep Dives Fonterra pan-Europe, August 2011
    37. 37. Example: The snacking paradox (BFY)• Consumers believe they should not eat anything in-between. However, they do.• So it should not contain anything that “matters”.• However most options – especially the good tasting ones – add significantly to the daily intake Opportunity Getting closer to “does not matter” and good taste & being healthy “Permissible” snack that is healthier while still tasting good.  Making current offerings more appealing  Make new offerings around the better-for-you benefits. 37
    38. 38. Example: Getting all you need in an easy way (GFY)• Consumers want to have something in the morning that can keep them going• They’d like to have something with the right nutritional value to give them energy• However most options take quite some time to prepare & are not per se healthy OpportunityGetting closer to time saving convenience and that’s what good for them “All inclusive morning” solution that is ready made, has protein in it for sustainable energy and still tastes good.  Making current offerings more appealing  Make new offerings around the better-for-you benefits. 39
    39. 39. Protein knowledge consumers • ~20% is prepared to pay more for protein enhanced products • Knowledge about protein increases by age Dairy was mentioned 2nd as a source of Protein protein (after meat) Protein is healthy supplements is for body builders Protein is Protein is crucial for good for growth & developmentI get enough muscles protein if I How mucheat balanced protein should What makes protein important for % consumer I take? human beings? mention Essential for a healthy diet 98% Provides energy 80% Is an essential part of the body / to live 65% Health 19% 40Source: Consumer Deep Dives Fonterra pan-Europe, August 2011
    40. 40. Agenda Workshop 10:30 – 11:00 : Introduction 11:00 – 11:30 : CSM: Profile & Strategy 11:30 – 12:00 : Fonterra: Profile & Strategy 12:00 – 13:00 : LUNCH 13:00 – 13:30 : Looking insiGHT consumers’ 13:30 – 14:00 : Dairy ingredients: a taste, texture & nutrition solution 14:00 – 15:00 : Illustrations 15:00 – 15:30 : Conclusions & Next Steps 15:30 : Closure 41
    41. 41. Technical expertise how does protein work? how much protein does a human being need? are there differences between the different sources of protein? when should protein be eaten? what does Buttermax™ really do? 42
    42. 42. How does it work: Protein – the building block • An organic compound formed of units called amino acids, arranged in a chain • Amino acid sequence is unique for each protein, and determines a protein’s shape and role. • The nutritional value of a protein (eg - how useful it is in the human diet) has been based on it’s amino acid composition. • Amino acids are the “building blocks” of the body • Every body tissue contains protein – Muscle, Liver, Kidney, Brain, Intestines, Bone, Blood 43Source: Consumer Deep Dives Fonterra pan-Europe, August 2011
    43. 43. Muscle is key… • Largest tissue in the human body • Responsible for the majority of energy expenditure • Essential for every single daily activity • Optimal muscle maintenance process is dependant on a specific amino acid (leucine), and timing of consumption 44Source: Consumer Deep Dives Fonterra pan-Europe, August 2011
    44. 44. Dairy protein, particularly whey, provides optimal build .... Why Whey? 2.5 Whey Fold change in plasma leucine Soy 2 Rapidly digested Casein (from baseline) 1.5 Adapted from: 1 Phillips et al, (2009) 4 0.5Fold change in lean mass gains 3.5 (from CHO/Placebo) 0 3 0 30 60 90 120 150 180 2.5 Minutes following consumption of protein 2 Adapted from: 1.5 Tang et al, (2009) 1 0.5 0 Promotes more muscle mass CHO/Placebo Soy Milk Whey 46Source: Consumer Deep Dives Fonterra pan-Europe, August 2011
    45. 45. Fonterra Nutrition goal is to …..Improve the nutritional balance of foods to aid in healthier lifestyle –Substituting for carbohydrate and fatSpread protein intake over the day to optimise muscle maintenance process – Breakfast – Lunch – Dinner Without compromising taste and texture or naturalness.... 47
    46. 46. Agenda Workshop 10:30 – 11:00 : Introduction 11:00 – 11:30 : CSM: Profile & Strategy 11:30 – 12:00 : Fonterra: Profile & Strategy 12:00 – 13:00 : LUNCH 13:00 – 13:30 : Looking insiGHT consumers’ 13:30 – 14:00 : Dairy ingredients: a taste, texture & nutrition solution 14:00 – 15:00 : Illustrations 15:00 – 15:30 : Conclusions & Next Steps 15:30 : Closure 48
    47. 47. Let’s have a look, feel & taste  Hand-outs  Tasting Session 49
    48. 48. Example 1: Granola BarImprove body tone, stay mobilelonger, re-energises without thesugars/fatsHelps to build and maintainmuscle mass; Healthy ChoiceEnhances with dairy/whey proteinand 30% less fat & sugar• 25% of daily required needs• Equals 1 glass of milkPowerprotein 515 –Good for You / Betterfor You 50
    49. 49. Example 2: Chocolate Brownie (glutenfree) Reduces the risk of allergy Fits in a gluten free dietDoes not contain glutenPowerprotein 515 –Better for You 51
    50. 50. Example 3: Chocolate Muffin (eggfree Reduces allergies and risk; helps to prevent high cholesterol and has 50% cholesterolDoes not contain eggs,WPC 131– Better forYou 52
    51. 51. Example 4: Yellow Cake (Buttermax Helps prevent obesity, cardiovascular disease and diabetics.Less saturated fat; Healthy ChoiceContains concentrated dairy fat /ButtermaxTM30% less saturated fatButtermax – Betterfor you 53
    52. 52. Different consumer benefits (claims) can dairy provide tackling the consumer needs in the better-for-you area Consumer benefit Functional benefit Ingredient Application Body tone, Builds & maintains PowerProteinTM 515 Granola bar (re)energy, mobility muscle mass WPC & low fat/ low sugar Reduced allergen Gluten-free PowerProteinTM 515 Chocolate risk WPC Brownie* Reduced allergen Egg-free PowerProteinTM 131 Chocolate Muffin risk, Lower WPC cholesterol (-50%) Obesity, Lower saturated fat ButtermaxTM Yellow Cake Cardiovascular (upto -30% vs disease, Diabetics butter) All without jeopardizing good TASTE & TEXTURE and NATURALNESS 54* or any other non-rising products

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