The Decision-Making Process for Fast Moving Consumer Goods

The Decision-Making Process for Fast Moving Consumer Goods

Date: June, 2010

Daedalus Millward Brown Public Survey

2Objectives

Identifying the buying habits for the FMCG categories

Identifying the factors with the highest importance in choosing a brand

Determining the evolution of choosing a brand for different product categories

Identifying the preferred types of promotions

3Conclusions »

In 2010, similarly with the previous year, the decision regarding the brands purchased for household consumption is taken together with other family members.

Even though the decision regarding the brand is mainly taken at home for most product categories, for coffee and for carbonated soft drinks the decision in front of the shelf records significant increases in 2010.

In turn, alcoholic drinks, beer and spirits register increases in the number of consumers who decide on the brand at home.

The decision regarding the brand

4» Conclusions

The main factors that influence the in-store decision regarding the brand continue to be represented by different types of promotions.

The categories most exposed to change in the buying behavior in 2010 are: spirits, margarine, natural juices and non-carbonated soft drinks (only 45% of the consumers having a similar behavior);

On the other hand, coffee, mineral water and dairy products (yoghurt and milk) have at least 60% consumers with the same consumption habits as in the previous year.

In line with the consumption decrease, a significant modification in behavior as compared to the last year is represented by buying the same brands in smaller quantities.

Decision factors and changes in behavior

5» Conclusions

As compared to 2009, buyers use store’s magazines significantly less often, although the percentage of those who often choose a brand because it is on promotion increased. The reasons for this may be related either to the discrepancies between the content of the magazines and what can be found effectively in the stores, or to the fact that buyers benefit from generous and permanent offers for all product categories;

Compared to the previous year, there is a substantial increase in the number of buyers who often choose a brand that is cheaper over their preferred one;

The most preferred type of promotion is the price reduction for the same quantity offered, which increased in attractiveness from last year;

On the other hand, prize contests lost attractiveness, recording a significantly lower score than in 2009.

Types of promotions taken into consideration

6Methodology

Research methodSurvey

Target populationPersons aged 18-50 years old, from urban areas, with a high level of education (university or post-graduate), who consider their current economical situation is not much worse than last year, and in thenext 12 months it won’t be much worse than it is in the present, and who usually go shopping inhypermarkets, supermarkets or cash&carry stores.

Sample size362 respondents

Data collection techniqueOnline Interviews

FieldworkMay 2010

7

AB 1. Who is deciding more often over the purchased brands in your household?

The decision considering the purchased brands

2009N=403

2010N=362

2.8

70.573.8

26.726.2

Just you

You and another person

Another person

% %

8Choosing a brand: at home or in front of the shelf?»

AB 6. Please think about how you usually proceed when choosing a brand. For which of the following categories do you choose the brand in frontof the shelf and for which of them do you know from home what brand you want to purchase? For… do you usually choose the brand in front ofthe shelf or you already know from home what brand you want? What about for…

Carbonated soft drinks

37.027.7

50.7 50.844.7

31.543.2

37.3 35.746.1 48.0

41.2 43.1

55.3 56.862.7 64.3

53.9 52.058.8 56.9

46.9

49.249.3

68.5

53.1

72.363.0

I know from home what

brand I want to

purchase

I choose the brand in

front of the shelf

Non-carbonated soft drinks

Natural juices/ nectar Beer Yoghurt Sour cream Milk

20092010 20092010 20092010 20092010 20092010 20092010 20092010

N=247 N=254 N=268 N=263 N=310 N=354 N=289 N=316 N=355 N=373 N=340 N=358 N=315 N=341

% % % % % % %

Base*

*The percentages were standardized by cutting out the “DK/NA” option

Significant diffrences compared to 2009 (level of confidence of 95 %)

9Choosing a brand: at home or in front of the shelf?»


Significant diffrences compared to 2009 (level of confidence of 95 %)

57.748.7

62.0 58.851.3

28.518.8

54.459.3

46.2

58.8

30.8 33.0

48.7

81.2

45.640.7

53.8

41.2

69.2 67.0

51.2

42.351.3 48.8

71.5

38.0 41.2I know from home what

brand to buy

I choose the brand

when I am in front of

the shelf

20092010 20092010 20092010 20092010 20092010 20092010 20092010

N=211 N=314 N=319 N=296 N=346 N=141 N=348

% % % % % % %

Base*

LiquorsMargarine Sausages Chocolate Coffee

Non-carbonated/

mineral waterOil

N=233 N=346 N=355 N=307 N=379 N=162 N=374

**The percentages were standardized by cutting out the “DK/NA” option

10

64.1 68.9 70.0 65.259.4

66.560.2

40.6 39.8

65.7

34.830.0 33.534.331.135.9I know from home what

brand to buy

I choose the brand when I

am in front of the shelf

Canned meat

Choosing a brand: at home or in front of the shelf?»


Canned vegetables

Rice Flour Candies

2010 2010 2010

N=339 N=343 N=157 N=218 N=340 N=332

% % % % %

Base* N=260

%

Biscuits

N=302

SugarPasta

2010 2010 2010 2010 2010

% %

**The percentages were standardized by cutting out the “DK/NA” option

11

58.1

49.7

47.9

47.2

43.0

36.0

35.3

32.9

21.8

13.4

7.2

10.5

41.8

57.0

44.0

48.5

50.0

43.2

34.8

28.8

28.9

22.6

12.0

9.5

10.1

44.1

*People that choose the brand inside the store for at least one of the products

Factors that matter most in choosing a brand– 2010 »

AB 7. Which of the following aspects are very important to you personally when choosing a brand inside the store?

%

2010N=325*

Offering a price reduction for buying more products from the same category

The fact that the brand has a price reduction

The release of new ranges

The brand offers a gift

The existence of a contest/ a promotion offered by the brand

The release of new products

The possibility of tasting the products

On-the-shelf brand visibility

The fact that a brand has the lowest price

Promotional materials (brochures, posters etc.) inside the store

The advice from a brand promoter inside the store

The release of a new package

Something else

2009N=347*

%

12

11.3

14.1

14.5

13.2

15.5

15.7

13.6

12.9

30.7

31.0

32.4

30.9

25.2

27.7

22.4

30.3

33.7

31.8

24.8

60.4

46.1

50.3

56.9

64.67.9

6.9

12.8

10.2

8.8

10.0

2.6

4.3

3.1

1.5

1.3

2.3

0.3

6.2

46.2

53.6

46.9

61.7

55.5

47.8

PD1. Please think about your shopping behavior during this year, in comparison with the same period of the last year. Which is the situation thatbest suits you for the following product categories?

Changes in brand choice – 2010 »



Natural juice/ nectar

Beer

Yoghurt

Sour cream

Milk

Margarine

Sausages

Chocolate

Coffee

N*=362

%

I try to find cheaper brands

I gave up buying this product category

I buy the same brands I got used to, but in smaller quantities

I haven’t changed my buying habits

**The percentages were standardized by cutting out the “I don’t usually buy this product category” option

*Persons who usually go shopping in stores like hypermarket/ supermarket/ cash&carry, who get involved in the decision=making process regarding the purchased brands and who last time went shopping in one of the following supermarkets: Kaufland, Billa, Carrefour, Metro, Real, Cora

Significant differences in comparison with 2009 (level of confidence of 95 %)

13» Changes in brand choice – 2010

20.8

15.6

23.1

19.4

26.2

24.9

15.8

16.6

23.1

23.5

24.6

21.2

22.5

20.7

20.7

28.4

27.1

52.3

52.5

52.8

47.8

51.0

12.8

8.0

29.0

5.3

8.2

1.4

0.6

5.7

15.8

0.7

6.9

2.2

1.1

0.9

25.9

31.7 44.5

49.9

60.0

48.7

54.3

55.3Oil

Spirits

Non-carbonated/ mineral water

Pasta

Sugar

Canned meat

Canned vegetables

Rice

Flour

Candies

Biscuits

N*=362

%








*Persons who usually go shopping in stores like hypermarket/ supermarket/ cash&carry, who get involved in the decision-making process regarding the purchased brands and who last time went shopping in one of the following supermarkets: Kaufland, Billa, Carrefour, Metro, Real, Cora

14

6.2

16.1

16.1

8.9

21.5

18.4

20.5

18.1

33.6

17.1

29.6

20.3

25.8

25.2

20.4

18.0

17.5

20.4

29.4

28.5

16.5

15.6

25.9

17.6

62.5

52.9

50.6

54.9

67.9

48.6

50.0

64.4

12.3

13.8

10.3

12.0

1.1

11.8

7.2

1.4

6.6

2.3

1.5

1.8

6.3

3.8

6.0

10.7

16.8

2.2

47.4

58.2

64.2

50.9

59.4

52.9

Changes in brand choice– 2009

N*=345

%



Natural juices /nectar

Beer

Yoghurt

Sour cream

Milk

Margarine

Sausages

Chocolate

Coffee

Oil

Spirits

Carbonated, non-carbonated or mineral water








15Ways of choosing a brand– 2010 »

PD4. When thinking about the way you choose the products for purchase, how often do you ...

44.6

41.7

17.8

17.6

13.8

12.7

9.2

41.9

54.1

78.8

57.8

61.3

74.4

64.8

4.1

3.4

24.6

24.9

12.9

26.0

13.5

Often Sometimes Never

%

N=362

... you choose a brand because you received a free sample inside the store

... inside the store you choose a brand that is different from the one you thought you would buy when you left home

... you choose a cheaper brand than the one you prefer

... you choose to buy a private label (e.g.: Aro, Nr. 1, Winny etc.)

... you choose a newly launched brand

... you choose a brand because it is on promotion

... you find out about the existing promotions from the store’s magazine


16» How to choose a brand– 2009

52.3

24.9

17.2

13.1

8.1

11.0

8.6

36.5

71.9

77.0

55.7

60.6

76.9

62.3

3.2

5.8

31.2

31.3

12.1

29.1

11.2

Often Sometimes Never

%

N*=345

PD4. When thinking about the way you choose the products for purchase, how often do you ...


... you choose a brand because you received a free sample inside the store

... inside the store you choose a brand that is different from the one you thought you would buy when you left

home

... you choose a cheaper brand than the one you prefer

... you choose to buy a private label (e.g.: Aro, Nr. 1, Winny etc.)

... you choose a newly launched brand

... you choose a brand because it is on promotion

... you find out about the existing promotions from the store’s magazine

17The most attractive types of promotions

PD5. Which from the following promotions types do you consider to be most attractive:

Poll 7: If the total value of offered prizes within a promotion is the same, which option attracts you?

44.1

45.6

30.8

34.6

23.3

11.1

2009N=345*

2010N=362

% %

47.5

29.5

29.4

15.0

53.6

12.8

Price reduction for the same quantity

Offering an extra unit (i.e.- 2 + 1 free)

Offering an extra quantity for the same price

Offering another type of product as a gift (i.e.-coffee+ mug)

The possibility to enter prize contests (with on the spot prizes or with prizes sent by mail)

Price reduction for buying more units (i.e.- for buying 2 products you have a cost reduction)



Demographics

19

39.8

32.8

27.4 40-50 y.o.

30-39 y.o.

18-29 y.o.

Male

43.6 %

Female

56.4 %

Demographic profile»

S 0. Please tell me what is your exact age? S 2. You are Female Male D4. What is the highest level of education you attained?

Gender

N=362

Age

%

20

14.6

16.9

17.0

2.0

20.8

15.8

12.8More than 3600 RON

2250 - 3599 RON

1800 - 2249 RON

1400 - 1799 RON

1000 - 1399 RON

Less than 1000 RON

No income

» Demographic profile

D 9. Personal monthly net income?/ D 10. Monthly net income per family member ? S 4. Which of the following categories best representsyour current occupation status?

Personal monthly net income

Monthly net income per family member

N=362

17.7

13.1

16.8

8.7

2.3

11.6

16.3

13.5

More than 3375 RON

2250 - 3374 RON

1650 - 2249 RON

1400 - 1649 RON

1000 - 1399 RON

800 - 999 RON

350 - 799 RON

Less than 350 RON

% %

Thank you!

The Decision-Making Process for Fast Moving Consumer Goods

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