“NEW ONVENIENE” · Source: Nielsen Shopper Solutions | Nielsen Generational Segmentation LATAM...

43
THE FUTURE OF MODERN TRADE September, 2016 “NEW CONVENIENCE”

Transcript of “NEW ONVENIENE” · Source: Nielsen Shopper Solutions | Nielsen Generational Segmentation LATAM...

Page 1: “NEW ONVENIENE” · Source: Nielsen Shopper Solutions | Nielsen Generational Segmentation LATAM IS IN THE ERA OF DIGITAL GENERATION MILLENNIALS ARE THE MOST AVID ONLINE GROCERY

THE FUTURE OF MODERN TRADE September, 2016

“NEW CONVENIENCE”

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“ ”

Convenience is not a store format it is a consumer need

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SOURCE: WORLD BANK

MAJORITY OF CONSUMERS LIVE IN URBAN AREAS

85% of Latin American population will be

URBANIZED

by 2050

95%

89%

94%

89% 90%

84%

81%

78% 78% 79%

71% 71%

64%

58%

52%

97% 95% 95%

93% 92% 91% 89%

86% 86% 84% 83%

78% 75%

70% 67%

Hon Arg PR Chi Ven Bra CR Peru Mex Col Bol Slv Ecu Hon Gua

2014 2050

% Urban Population

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SOURCE: IBM COMMUTER PAIN INDEX

COMMUTING IS A PROBLEM

2 COMMUTES

PER DAY of at least 1 hour each

way and walk 1.4 Km

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SOURCE: WORLD BANK | CAM = Central America

ALL MEMBERS OF THE FAMILY WORK FOR LONG PERIODS

70% 62% 61%

30% 38% 39%

1990 2016 2050

CA

M

WOMEN MEN

65% 57% 57%

35% 43% 43%

1990 2016 2050

BR

AZI

L

70% 63% 62%

30% 37% 38%

1990 2016 2050

MEX

ICO

70% 57% 57%

30% 43% 43%

1990 2016 2050

CO

LOM

BIA

69% 59% 59%

31% 41% 41%

1990 2016 2050

CH

ILE

64% 59% 58%

36% 41% 42%

1990 2016 2050

AR

GEN

TIN

A

62% 55% 54%

38% 45% 46%

1990 2016 2050

PER

U

68% 60% 59%

32% 40% 41%

1990 2016 2050

VEN

EZU

ELA

Latinos WORK

42 HOURS

PER WEEK vs.

37 in European countries

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Source: Nielsen Shopper Solutions | Nielsen Generational Segmentation

LATAM IS IN THE ERA OF DIGITAL GENERATION

MILLENNIALS ARE THE MOST AVID ONLINE GROCERY

SHOPPERS 57% are already using Online to order

for delivery to home and 30% Willing to use

Edad: 0-20 Generación

Z

Edad: 21-34 Millennials

Edad: 35-49 Generación

X

Edad: 50-64 Baby

Boomers

Edad: +65 “Silent

Generation”

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On the go lifestyle… need for

SPEED 43%

Want to spend less time shopping

"it is a chore"

56% Latinos look for

proximity of stores to make purchases

47%

Prefer to get in and get out quickly

of the store

SOURCE: Global Survey Growth Strategies 2016

76% Like to go shopping – because of the experience

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Number Store Index vs. 2010

SOURCE: NIELSEN RETAIL UNIVERSE DATA 2015 - BASE 100% NUMBER OF STORES IN 2010

PROMOTING THE EXPLOSION OF EMERGING FORMATS THROUGHOUT LATIN AMERICA

123

134

104

112

2010 2011 2012 2013 2014 2015

BRAZIL 180

94 105

185

2010 2011 2012 2013 2014 2015

MEXICO

148

203

126

2010 2011 2012 2013 2014 2015

COLOMBIA

99

144

123

113

2010 2011 2012 2013 2014 2015

CHILE

122

142

134

2010 2011 2012 2013 2014 2015

CAM

117

122

99

96 2010 2011 2012 2013 2014 2015

ARGENTINA

Convenience

Gas Stations UTT+DTT*

Pharmacies & Drugstores UTT + DTT

Superettes 100-400 m2 UTT + DTT

Small Supermarkets 400 – 1000 m2 UTT + DTT

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*Mesured Countries:: Nielsen Retail Index 2015| Traditional Trade Includes: Traditional <100m2+Kiosks+Superettes DTT+HORECA

Convinience only measures in Mexico and Gas Stations in Brazil, Chile & Argentina | Drugstores & Gas Stations include UTT+DTT

RETAIL SALES LATIN AMERICA

Traditional Trade Pharmacies & Drugstores

Superettes 100-400 m2 Large Supermarkets >1000 m2 Convenience + Gas Stations

33% 33% 34%

10% 10% 10% 2% 3% 3%

14% 14% 15%

39% 38% 37%

2010 2013 2015

BRAZIL

28% 24% 28%

5% 4% 6% 3% 6% 3% 7% 8% 8%

57% 58% 56%

2010 2013 2015

COLOMBIA

AC

V S

LAES

52% 54% 57%

7% 6% 5% 0% 0% 0% 13% 13% 13%

28% 26% 24%

2010 2013 2015

CHILE

38% 40% 44%

11% 12% 5% 8% 7% 9%

38% 33% 34%

6% 8% 8% MEXICO

2010 2013 2015

AC

V S

LAES

24% 26% 26%

13% 12% 12% 7% 8% 10% 6% 7% 5%

50% 48% 47%

2010 2013 2015

CAM

23% 23% 22%

5% 5% 5% 1% 2% 3% 7% 7% 7%

60% 59% 58%

4% 4% 4%

2010 2013 2015

ARGENTINA

Small Supermarkets 400 – 1000 m2

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y. 7,718 Stores - ARGENTINA

1,100 Stores 2017 Projection - MEXICO 400 Stores - COLOMBIA

• Product Assortment 600 sku’s • 70%~ Private Label vs. 14% others • Prices below 30%~ vs. other retailers • Process Simplicity and cost efficiency:

• Exhibition • Suppliers Negotiation • Logistics • Merchandising • Services (eg. No Parking) • Cash Payments

SOURCE: NIELSEN HOMESCAN UK

https://www.linkedin.com/pulse/el-fenomeno-d1-en-colombia-hard-discount-juan-antonio-olivares

HARD DISCOUNTERS ARE INCREASING THEIR PRESENCE, ESPECIALLY WITH THE ECONOMIC RECESSION

179 Stores - BRAZIL

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1,100 Stores 2017 Projection - MEXICO 400 Stores - COLOMBIA

• Product Assortment 600 sku’s • 70%~ Private Label vs. 14% others • Prices below 30%~ vs. other retailers • Process Simplicity and cost efficiency:

• Exhibition • Suppliers Negotiation • Logistics • Merchandising • Services (eg. No Parking) • Cash Payments

SOURCE: NIELSEN HOMESCAN UK

https://www.linkedin.com/pulse/el-fenomeno-d1-en-colombia-hard-discount-juan-antonio-olivares

HARD DISCOUNTERS ARE INCREASING THEIR PRESENCE, ESPECIALLY WITH THE ECONOMIC RECESSION

179 Stores - BRAZIL

8% 8% 9%

10%

13% 14%

18%

21% 23%

24%

30%

35%

JAS'

13

ON

D'1

3

JFM

'15

AM

J'1

5

JAS'

15

ON

D'1

5

JFM

'15

AM

J'1

5

JAS'

15

ON

D'1

5

JFM

'16

AM

J'1

6

35% of Households purchase in D1 vs. 38% of Exito (Biggest Retailer in Colombia) Users of D1 are concentrating 24% of their total spend in D1 75% of their total sales in the last year came from shifting from Traditional Trade (34%), Independent Supermarkets (13%), Exito (13%) and Olimpica (4%) Strong presence in all socioeconomic levels

COLOMBIA HARD DISCOUNTERS

HOUSEHOLD PENETRATION

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Source: http://www.mercadotododia.com.br/lojas/

BRAZIL | 180 STORES

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BUT THE MEANING OF NEW CONVENIENCE GOES BEYOND PRICE…

NEW CONVENIENCE

READY TO EAT FOOD & DRINK

SOLUTIONS

WIDER RANGE OF PRODUCT

SELECTION

EXTENDED SERVICES &

HOURS

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SOURCE: Shopper Missions 2013 – Modern Trade: Argentina, Chile, México and Brazil | Traditional Trade Argentina, Chile, México, Brazil, Peru, Venezuela and Colombia

CHANNELS ARE BEGGINING TO CONVERGE BETWEEN MISSIONS

33%

22%

16%

16%

13%

Buy daily use items

Out of HomeConsumption

To Stock - up

Urgent Items orReplacements

Others

MODERN TRADE TRADITIONAL TRADE

38%

34%

17%

11%

2%

Out of HomeConsumption

Buy daily use items

Urgent Items orReplacements

Others

To Stock - up

Stock – up is a mission dominated by Mega markets

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RTE Food & Drink Solutions

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Latin Americans eat lunch away from home, the need is about convenience.

Source: The Nielsen Global Out-of-Home Dining Survey | LatAm | (Q3 2015)

This Nielsen survey is based only on the behavior of respondents with online access. Internet penetration rates vary by country. Nielsen uses a minimum reporting standard of 60% internet penetration or an online population of 10 million for survey inclusion.

THE NEED FOR SPEED IS REFLECTED IN MEAL HABITS ACROSS THE REGION

13% 14%

6%

17%

6%

19%

10%

37%

72% 72%

58%

79%

64%

70% 72%

39%

47% 43%

33%

43%

51%

AR BR CO MX CL VE PE

BREAKFAST LUNCH DINNER LATAM: 3,066 RESPONDENTS

510 500 516 502 517 521 517

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SOURCE: Global Survey Growth Strategies 2016

PREPARED FOODS IN STORES ARE HIGHLY VALUED BY CONSUMERS IN LATIN AMERICA

The store has a variety of freshly prepared foods which is highly influential…

I often visit the store for the additional services they provide

39%

28%

41%

51%

43%

32%

39% 40%

T. L

ATA

M AR

BR

CO

MX CL

VE

PE

Fast-food services

40%

20%

NOT AVAILABLE, BUT I WOULD USE

AVAILABLE, AND I DO USE

42%

22%

Coffee Services

Prepared food services

39%

16%

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Nielsen Hong Kong ShopperTrends Reports

IN HONG KONG RTE FOOD HAS BEEN A KEY DRIVER OF GROWTH FOR CONVINIENCE STORES

Daily Café Fresh Brewed Coffee

Fresh Sandwiches Prepacked High Quality Sandwiches

Fastfood Combo Fresh made local snacks

Increasing space allocation for Ready-To-Eat food and drinks, with more varieties ranging from fresh brewed coffee to hot breakfast choice and tea-time snacks.

VanGo Circle K 7-Eleven

66 90

2014 2015

+24%

51 75

2014 2015

+24%

21 38

2014 2015

+17%

Consumers are also welcoming the wider range of RTE offering with positive response - Increasing % associated with the attribute of “RTE food & drink is of high quality” by each of the key CVS chains*

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SOURCE: Global Survey Snack Consumption 2014

SNACKS ARE USED AS A MEAL REPLACEMENT

56%

AS A BREAKFAST ALTERNATIVE

68%

FOR AN ENERGY BOOST

47%

AS A LUNCH ALTERNATIVE

51%

AS A DINNER ALTERNATIVE

74% SNAKCS

FOR INBETWEEN MEALS

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SOURCE: Global Survey Snacks consumption 2014

CONSUMERS SEEK FOR HEALTHIER OPTION SNACKS

Consider the following to be relevant for their snacks purchase

64%

58%

56%

49%

48%

All natural

Natural flavors

High in fiber

Genetically modified organism (GMO) free

No artificial colors

Latvia Meals +8.9% in 2015

Unique and wide assortment on the go; Quality of products with Fresh & Tasty.

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NATURAL AND HEALTHY INGREDIENTS ARE RELEVANT FOR SNACKS GROWTH

Tribos Snack 40% less sodium, 7 grains,

organic ingredients, sesame seed and linseed

Passatempo biscuit 50% less sugar with the

same taste

Snacks made with vegetables such as nopal or no/less fat (43% on other

premium brands).

BRAZIL

MEXICO COLOMBIA

Ingredients: • Quinoa,

• Andean Seeds & Cranberries • Oats and berries

• Sesame • Multicereal: wheat,

rice, oats, corn, almonds and linseed

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SOURCE: Global Survey Snacks consumption 2014

HEALTH-CONSCIOUS CONSUMER DEMAND MORE

LATIN AMERICAN CONCERNS

HEALTHY BEVERAGES

READY TO DRINK MILK/YOGHURT

PRE-CUT FRESH FRUITS

RTE VEGETABLES

PREPARED FOOD

91% Consider healthy hydratation as a lifestyle

55% prefer sndwich as a snack

52% prefer Vegetables as a snack

65% prefer yogurt as a snack

57% prefer fresh fruIt as a snack

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Sourrce: The Nielsen Global Out-of-Home Dining Survey | LatAm | (Q3 2015)

RTE FOOD AND RTD BEVERAGES OFFER A HUGE OPPORTUNITY FOR GROWTH

51% 18% 10% 43% 41% 24%

MUNCHING ON THE MOVE SIT-DOWN SERVICE

FAST FOOD RESTAURANT

STREET FOOD

SELF-SERVICE CAFETERIA

CASUAL DINING

FORMAL RESTAURANT CAFÉ

(VS. 57 GLOBAL)

55% BRAZIL 53% COLOMBIA

(VS. 27% GLOBAL)

30% MEXICO 22% VENEUELA

(VS. 22% GLOBAL)

12% CHILE

(VS. 56% GLOBAL)

46% COLOMBIA

(VS. 43% GLOBAL)

51% PERU 46% MEXICO

(VS. 29% GLOBAL)

31% MEXICO 38% COLOMBIA

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THAT’S WHY RTE-RTD STRATEGY SHOULD BE REINFORCED WITH SOCIAL MEETING PLACES

Competing directly with Quick Serve Restaurants and Coffee Shops in all markets

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WIDER RANGE Product Selection

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SOURCE: Global Survey Growth Strategies 2016

SHOPPERS ARE INCREASINGLY SEEKING FOR ONE- STOP SHOPPING SOLUTIONS

50% WANT TO HAVE FOOD AND NON FOOD ITEMS IN THE SAME PLACE

ON LINE RESPONDANTS IN LATAM

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SOURCE: Global Survey Retail Preferences 2015

LATINOS LOOK FOR NON FOOD CATEGORIES IN EMERGENT CHANNELS

CO

NSU

MER

S B

UY

ING

MO

RE

OFT

EN

HYPERMARKETS/ MASS MERCHANDISE 25%

SUPERMARKETS/ GROCERY STORES 27%

DISCOUNTERS/ CLUB STORES 12%

CONVENIENCE STORES 14%

PHARMACY/ DRUG STORE 18%

HYPERMARKETS/ MASS MERCHANDISE 28%

SUPERMARKETS/ GROCERY STORES 30%

DISCOUNTERS/ CLUB STORES 13%

CONVENIENCE STORES 16%

PHARMACY/ DRUG STORE 16%

PERSONAL CARE

FOOD & GROCERY

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GAINING CONSUMER'S PREFERENCE VIA A WIDER PRODUCT SELECTION

FRESH PRODUCTS

Filling everyday consumer needs from snacks to daily shopping

1

PRIVATE LABEL OPPORTUNITY

Diversifying retail brands with smart innovation Develop portfolio segmentation from low-mid price to premium and premium+

2

LOCAL BRANDS & EXCLUSIVE

LAUNCHES

Experimenting with local tastes and flavors (Local Favorites) Bringing new excitement to a range of new shoppers (Students, elders, moms, etc.)

3

RETAIL

BRANDS

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TRADER JOE’S – U.S.A. Organic Food and Private Label

Source: http://www.traderjoes.com/

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Global Survey Fresh Food 2014

FRESH PRODUCTS ARE AN ANCHOR FOR CONSUMERS IN LATIN AMERICA

Consumers consider high quality fresh products to be influential in their store choice

56% 53% 52% 49%

43% 42% 42%

Bra Col Mex Ven Chi Arg Peru

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Global Survey Fresh Food 2014

FRESH PRODUCTS ARE ONE WAY TO GAIN SALES FROM TRADITIONAL TRADE

8% 7% 9% 13%

9% 10%

39%

47% 50%

18%

61%

23%

Category 1 Category 2 Category 3 Category 4

SMALL FORMATS

TRADITIONAL CHANNELS

Meat & Poultry

Fruits & Vegetables

Dairy Bread & Bakery

Delicatesen Fish & Seafood

Where consumers buy more?

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Providing convenience in “fresh”

INDIVIDUAL FRUIT AND VEGETABLES

READY-TO-COOK INGREDIENTS

INTRODUCING FRESHNESS INTO CONVENIENCE

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SOURCE: Global Survey Retail Growth Strategies 2016

CREATING OPTIONS TO DIVERSIFY THE OFFER

39%

QUALITY HAS GREATLY

IMPROVED

35%

BUY MORE IF MORE ARE

AVAILABLE

36%

GOOD ALTERNATIVE TO NAME BRANDS

Private Labels in Latin America

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*Salty biscuits self-services

Siurce: Nielsen Retail Index

LOCAL PRODUCTS LEADING THE WAY IN LATAM

63% OF INTERNET RESPONDANTS IN LATIN AMERICA

Prefer to buy Local brands because they are supporting local companies

“From the herb to your glass” Beverages made with local herbs. Grew three times above the category in value (36% vs 13%).

“Take care, do not punish yourself” Extended healthy portfolio. Natural & local ingredients as Quinoa, Chia, Andean Seeds, etc. 39% of $ share in healthy biscuits .

“Passion for natural and organic.. that take

care of the body and soul.”

Extended healthy portfolio.

While T. Cereals loses value,

mae terra grows 37%. • Cereals, oats & granolas • Biscuits, Cereal Bars • Rice, flour, sugar, etc. • Salty snacks, Seeds & nuts

Products with natural & local ingredients and gluten free. Nopal, Blue Corn… In Biscuits* grew three times above category (15% vs 5%)

COLOMBIA MEXICO ARGENTINA BRAZIL

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SERVICES Being a convenient

destination

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SOURCE: Global survey Retail Preferences

ADOPTING AND EVOLVING THE SERVICE MODEL TO PROVIDE CUSTOMERS WITH SOLUTIONS TO A NUMBER OF NEEDS

I often visit the store for the additional services they provide

NOT AVAILABLE, BUT I WOULD USE AVAILABLE, AND I DO USE

51%

22%

54%

20% 27%

31%

22%

36%

Health Clinic Services

Pharmacy Services

Banking Services

Petrol / Filling Stations

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WE HAVE OBSERVED GREAT EXAMPLES IN LATAM

Increasing shopper spend and frequency

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Source: http://www.ibon.com.tw/

BUT WE STILL HAVE A LONG WAY TO GO… AN OMNICHANNEL, MULTISCREENING EXPERIENCE OPPORTUNITY

Upgraded 2nd generation ibon Printing/Scan event tickets/transportation

tickets besides household bill payment

Provide tablet in sitting area Customer can access to 7-Net

to shop more

In-store media Sports/TV commercials

VIETNAM

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From bill payment to having a hot meal, more services are being added…..

TO MAKE SHOPPERS’ LIVES TRULY CONVENIENT

PAYMENT AND BANK

SERVICE

฿ FRESH FOOD READY-TO-EAT

DINE-IN

TICKET PICK-UP

GAS STATION

ATM WIFI

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São Gonçalo do Amarante

Camaragibe

Conde

São Gonçalo do Amarante

Cascavel

Angatuba

Itapemirim

Serra

Ribeirão das Neves

EXTENDED SERVICES &

HOURS

READY TO EAT FOOD & DRINK

SOLUTIONS

WIDER RANGE OF PRODUCT

SELECTION

Loyalty Programs | Promotions

Digital and E-commerce Strategy

Strategic Locations

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SOURCE: Nielsen Spectra Mexico

MOVE BEYOND THE BIG CITIES TO CAPITALISE ON CONSUMER PURCHASING POWER

TOP CITIES (VDM, Gdl, Mty)

AVG. HOSEHOLDS PER TRADITIONAL STORE

AVG. HOUSEHOLDS PER SUPERMARKET

29

HOUSEHOLDS

7,772

POTENTIAL CITIES 30 8,404

Modern Trade overdeveloped and Traditional high saturation

OTHER CITIES 39 5,703

STRATEGIC OPENINGS HERE

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Serra

Ribeirão das Neves

EXTENDED SERVICES &

HOURS

READY TO EAT FOOD & DRINK

SOLUTIONS

WIDER RANGE OF PRODUCT

SELECTION

Loyalty Programs |Promotions

Digital: E-commerce Strategy

Strategic Openings

HOW NIELSEN CAN HELP?

Shopper Missions Shopper Preferences On Premise Panel

Product Innovation (Private Labels) Household Panel Assortment CATMAN Platform

Strategic Locations with Spectra

Omnichannel Solutions

Loyalty Platform Marketing Effectiveness Price Elasticity

Shopper Solutions Spectra

Page 43: “NEW ONVENIENE” · Source: Nielsen Shopper Solutions | Nielsen Generational Segmentation LATAM IS IN THE ERA OF DIGITAL GENERATION MILLENNIALS ARE THE MOST AVID ONLINE GROCERY

[email protected]

Thought Leadership Director Latin America

THE FUTURE OF MODERN TRADE

“NEW CONVENIENCE”