Sopexa Conference - 20151001

FROM PRICE-DRIVEN TO EXPERIENTIAL MARKETING

How to win in an evolving German food market

October 1st 2015

© All information contained in this document are the property of Sopexa

WHAT IS THIS PRESENTATION ABOUT?

How does the German consumer

think and act today?

How is trade adapting?

How can you win on the German market?

Trends

Change

Success

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1 THE GERMAN FOOD MARKET

UNDERSTANDING THE SETTINGS

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WHAT ABOUT THE FOOD MARKET?

The fourth largest industry in Germany with

over 550,000 employees in 6,000 companies

The third largest exporting nation for food &

drinks

Turnover : € 172 billion

Import value : €47.2 billion

Export value : €54.4 billion

What about wines ?:

First import market in the world with 15.1

million hectolitres

4th consumption market in the world

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170.000 Food and beverage products available in German stores

Source: BVE 2015

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2 THE GERMAN CONSUMER

HOW DOES HE BEHAVE TOWARDS FOOD?

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HOW IT USED TO BE... German attitude towards food

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Price Is everything.

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Eating Is a must, not a particular joy.

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TRUTH IS... The German consumer is changing!

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51% Of German consumers declare that quality is the most important purchasing criteria.

Source: BVE 2015

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CHANGING PRIORITIES

Tasty

Healthy

Low in calories

Quick

Cheap

36-45 56-65 46-55 26-35 18-25 >66

56 59 49 45 40 32

1 7 6 4 7

23 33 29 85 40 43

9 3 5 8 9 15

11 4 8 5 6 2

What is the most important criteria when selecting food products (in %)?

Source: Zeit Magazin 2014

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93% Of German foodies are looking for pleasure and taste when considering food

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Source: Sopexa Foodies Survey 2014


10,2% Share of the expenses for food and non-alcoholic beverages on total private consumption 2014

+ a significant amount spent OOH

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Source: Eurostat 2014


A real boom of: cooking classes, special TV shows, magazines, blogs, events, supper clubs, cooking books....

Throughout Germany and for all generations:

it is almost a social

status!

It‘s all about pleasure, taste, sharing and experiencing.

The price is still important but not the main criteria!

...but food has taken a major role

in the German society

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SO... How does the consumer think and act towards food?

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FOOD TRENDS OVER THE YEARS

1950 1970 1960 1980

1980 2000 1990 2010

ABUNDANT MEAT KINGDOM QUICK AND

EASY

SPECIAL HEALTHY TASTY

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WHEN YOU LOOK AT MEGA TRENDS....

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... YOU FIND THEM AGAIN IN CURRENT FOOD TRENDS

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Safety: a large number of labels have appeared on the market and contribute to consumers‘ reassurance.

Strong lobbyism for more transparency

HE IS LOOKING FOR SAFE & HEALTHY PRODUCTS

Health: general awareness for overweight issues and linked diseases.

Strong federal initiatives to promote F&V consumption and healthy diets

Healthy food has become sexy

Organic power: the largest organic market in Europe with over € 7,5 billion in 2013.

Strongly dependent on imports

Large distribution and low price level: organic is accessible

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HE IS INFORMED

in product information due to several food scandals

Consumer associations (Foodwatch,

Stiftungwarentest...)

Government urging the food industry for more transparency

Strong

interest

Very vocal

Committed

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Environment: CSR, Carbon footprint, low water consumption, respect of forest, low waste…

Fair trade is growing: over €650 million sales value

generated in 2013. Growth of 15% every year

Strong social aspect

Animal wellfare:

7.8 Million vegetarians & 900.000 vegans live in Germany. Strong trend

Source: Vebu 2015

He cares and he says it out loud!

Regionality: a key purchase criteria for 75% of German consumers.

A huge trend all over Germany. Grocery shopping is being redefined.

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New retail formats : Rewe to go, Kochhaus

A new way to do shopping: hopping according to his needs

Convenience: it has to be quickly bought, quickly

prepared and quickly

eaten.

But tasty!

Out of Home: €71, 1 billion spent in 2014.

+€1,7 billion within a year

Source: BVE 2015

He wants food products to fit in his lifestyle!

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BUT NOT AT ANY PRICE

Of German consumers are still „hunting“ for price offers

Of purchase decisions are still based on promotional flyers

Still see „price“ as the main decision factor when purchasing food

69%

70%

49%

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3 WHAT DOES IT MEAN FOR THE TRADE?

A WIND OF CHANGE

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Over 38,000 food stores (without drugstores) in 2014.

4 to 5 stores per consumer

€ 235 billion turnover in

food products in 2013

72,59% market share for the 5 leading groups: Edeka, Rewe, Metro, Aldi, Schwarz.

Concentration on its way

The German retail landscape in a few figures

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The historical birth place of discounters in Europe

Strong position of discounters with 40 to 60% market share according to the categories

100% penetration rate


MARKET SHARE – FOOD RETAILERS 2014

28 Source: Statista 2015

© Tous les éléments contenus dans ce documents sont la propriété de Sopexa


Remember: price & function were key decision criteria when purchasing food.

Grocery shopping was quick, price-driven, unemotional.

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FOR THE LAST YEARS, A SLOW REVOLUTION HAS BEEN

HAPPENING DUE TO THE CONSUMER DEMAND...

Are listing A-brands, improving merchandising, adding new services (Bakery, Magazines..), doing spectacular promotions (Wines)

Are working on the shopping experience: new formats, adding value through education, events, merchandising, product offers (on the goo)

Need to reinvent themselves in order to survive: gastronomy, exclusive products

Discounters

Supermarkets

Specialty shops

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IT‘S ALL ABOUT THE EXPERIENCE

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IT‘S ALL ABOUT EXPERIENCE

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RETAILERS ARE RESPONDING TO SOCIETY CONCERNS

Strong involvement through labels (Proplanet) or support of international initiatives (WWF)

Focus on proximity and trust. Large communication campaigns to highlight regionality

Veggies and Vegan alternatives are available throughout retail: staff is trained to provide the best information to the customers

Environment /

Animal care

Regional brands

Meat-free

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RETAILERS ARE WORKING ON THEIR BRAND IMAGE

44% market share on the food market

Trading up of private labels ; complete assortments

Focus on one single brand, massive

communication campaigns : retailers are becoming food heroes!

Private Labels

Premiumization

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Image


A profound Mutation of the retail landscape which is to be continued...

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4 HOW TO WIN?

A FEW BEST CASES BY SOPEXA

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POS-EVENT

VIP-CUSTOMERS ENJOY FRENCH TURKEY

High quality product!

VIP-Customers from Perfetto,

Kaufhof and Frische Paradies

had the opportunity to be

convinced during an exclusive

gourmet evening at the POS.

Education and tastings were at

the center of the programm.

100 participants per event

POS-PROMOTION

BORDEAUX GOES GOURMET

Bordeaux is not only red! Cocktail

workshop during Edeka Gourmet

Festival with a specific focus on

white wines. Creation of cocktail-

variations by a famous Parisian

Barkeeper. Live-Shaking and

Tastings. Short workshops about

white wines from Bordeaux.

Results: Education and fun at the

same time. Positive experience

for trade partner and consumers.

POS PROMOTION

FRENCH SUMMER WINES HAVE UNDOUBTEDLY STYLE

A summer under the sign of French wines along the Rhine, Ruhr and the Spree. Tasting menus, art and litterature with a vinophile twist, ‘afterwork’ evenings, welcome packs. Over 4 weeks, 50 restaurants and POS organised events dedicated to French wines, all in their own way, but all undoubtedly with style. A brochure presented all the events at a glance.

Over 50,000 wine amateurs have

discovered French wines under a

new angle

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BLOGGER RELATIONS

SPANISH TAPAS WEEK

5 famous German Foodbloggers

developped creative recipes

based on Spanish quality

products and invited to a

„Spanish Tapas Week“ on the

web. All recipes were featured

on the blogs in an online booklet.

20.000 blog visits

72.000 page views

Diffusion on Facebook, Twitter, Instagram & Pinterest


5 LET’S WRAP UP

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LET‘S WRAP UP

Of consumers‘ behaviour and expectations towards food

On the German retail system and its core foundations

Is the key to win on the long term

Deep

change

Strong impact

Experience

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Any questions left or any support needed? [email protected]

Thanks for your attention

Sopexa Conference - 20151001

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