Shopper Insight Report- Oats Category

HGCA and VCR² Kent Business School Report

Contents

• Providing Shopper Insights

• Objectives

• Data Sharing Restrictions

• Executive Summary

• Analysis

• Appendix

Health Warning!

• The dunnhumby data offers unparalleled breadth and depth but it does not tell us why shoppers behave the way they do

• Further research is warranted in order to understand the purchasing drivers (e.g. attitudes, perceptions, motivations) before changes are made to the marketing mix (product, price, place, promotion) or resources are deployed for the development of new products

Providing Shopper Insights

Providing Shopper Insights

• Collaboration between HGCA and the Centre for Value Chain Research at Kent Business School since 2005

• Sponsorship of PhD students

• Access to panel of 1.4 million supermarket shoppers

• Provide generic and tailor made insight reports for the industry free of charge

Centre for Value Chain Research

Objectives

Objectives

• Provide an overview of shopper behaviour and shopper segmentation for Oat products

• Identify opportunities for market/product development• Highlight potential areas for further research

• Demonstrate the breadth and depth of shopper insight that is available to farmers and small food producers

Data Sharing Restrictions

Data Sharing Restrictions

This information is supplied by Kent Business School on the strict understanding that recipients use it exclusively as part of their own marketing and product development activities. Under no circumstances should the information provided be shared with third parties, without our prior consent. Failure to comply with these requirements will result in the organisations involved being denied further (subsidized) access to the dunnhumby data and may jeopardise this service provision for farmers and small food producers in the future.

Executive Summary

Executive Summary

• Overall, the oat category value has increased by 11% over the period, with a volume increase of 2%.

• Across the category as a whole, young families are the strongest performers. Young adults have a tendency to be least attracted to the category.

• Oats based products enjoy a healthy and positive image with consumers. As expected, healthy and finer foods shoppers are more likely to be attracted by the whole category. Price sensitive shoppers continue to find barriers to buying into the category.

• N. Ireland and N. Scotland are the regions most attracted to the category, but note that the majority of sales occur in other regions.

• Penetration rates and frequency of purchase indicate that there are opportunities to further drive sales.

Analysis

Composition of Oats Category

Composition of Oats Category

• Flapjacks

• Oat based Biscuits

• Oatcakes

• Oat based Breakfast Cereals

• Hot Cereals • RTE Cereals

• Oat Cereals Bars

Analysis

Key Measures

Key Measures

• Category Share• The share of sales for each product sub-group as a % of total category sales

(Highlights the relative importance of different product sub-groups)• Sales Growth

• Year on year growth of sales, by volume and value(Illustrates performance of different sub-groups over time)

• Penetration• % of shoppers who have made at least one purchase in the last 52wks

(Indicates scope for attracting new buyers).• Frequency of Purchase

• The average number of times a purchase as been made in the last 52wks(Indicates scope for increasing product usage)

• Repeat Purchase Rate• % of shoppers who have made at least two visits to the category in the last 52wks

(Gives an indication of product performance and shopper loyalty)

Key measures: oats

Key measures from Kent Business School: 52 weeks from 07-Jan-08 to 04-Jan-09

Source: © dunnhumby 2009

Weekly sale trends: oats(52 wks to 04 Jan 09)

Analysis

Shopper Segmentation

Shopper Segmentation

• Shopper profiles are presented in index form, with 100 representing the average for all supermarket shoppers

• Over-indexing segments purchase a disproportionately high share – they find them appealing• Under-indexing segments purchase a disproportionately low share – they find them less appealing.

• In looking for potential target segments (those which are under or over performing) attention is drawn to those which over-index or under-index by at least 10%

• Further segmentation, by geo-demographics and detailed lifestyle can be provided upon request

0

20

40

60

80

100

120

140

All Oats

Source : © dunnhumby 2008

Older Adults Older Families Young Adults Young Families Pensioners Mixed

Strongest appeal for Young Families

Strongest appeal for Young Families

Lifestage segmentation: oats – total(12 wks to 16 Nov 08)

020406080

100120140160

All Oats

Source : © dunnhumby 2008

Convenience Finer Foods Healthy Mainstream Price Sensitive Traditional

Healthy shoppers attracted by the category as expectedHealthy shoppers attracted by the category as expected

Mainstream and Price Sensitive under-perform in this category

Mainstream and Price Sensitive under-perform in this category

Lifestyle segmentation: oats – total(12 wks to 16 Nov 08)

0

20

40

60

80

100

120

140

160

All Oats

Source : © dunnhumby 2008

Northern Ireland Borders Southern Wales and the West Yorkshire Central Scotland East EnglandLancashire London Midlands North East Northern Scotland South West

Results are strongly skewed towards Northern Scotland even though the majority of sales

occur in London

Results are strongly skewed towards Northern Scotland even though the majority of sales

occur in London

Regional segmentation: oats – total(12 wks to 16 Nov 08

0

20

40

60

80

100

120

140

Hot Oat Cereals Oat Breakfast Cereals Rte Oat Cereals

Source : © dunnhumby 2008

Older Adults Older Families Young Adults Young Families Pensioners Mixed

Consistent appeal for Young Families across groups

Consistent appeal for Young Families across groups

Lifestage segmentation: oats cereals – total(12 wks to 16 Nov 08)

RTE cereals under-perform in their appeal to Pensioners shoppers

RTE cereals under-perform in their appeal to Pensioners shoppers

0

20

40

60

80

100

120

140

160

180

Hot Oat Cereals Oat Breakfast Cereals Rte Oat Cereals

Source : © dunnhumby 2008

Convenience Finer Foods Healthy Mainstream Price Sensitive Traditional

Finer foods and Healthy shoppers are the most attracted

to the category

Finer foods and Healthy shoppers are the most attracted

to the category

RTE cereals under-perform in their appeal to Price Sensitive shoppers

RTE cereals under-perform in their appeal to Price Sensitive shoppers

Lifestyle segmentation: oats cereals – total (12 wks to 16 Nov 08)

0

20

40

60

80

100

120

140

Hot Oat Cereals Oat Breakfast Cereals Rte Oat Cereals

Source : © dunnhumby 2008

Northern Ireland Borders Southern Wales and the West Yorkshire Central Scotland East EnglandLancashire London Midlands North East Northern Scotland South West

Results are strongly skewed towards Northern Ireland even though the majority of sales occur

in London

Results are strongly skewed towards Northern Ireland even though the majority of sales occur

in London

Regional segmentation: oats cereals – total(12 wks to 16 Nov 08)

0

20

40

60

80

100

120

140

160

180

Oat Based Biscuits Oat Cereals Bar Oatcakes

Source : © dunnhumby 2008

Older Adults Older Families Young Adults Young Families Pensioners Mixed

Older adults are most attracted to oatcakesOlder adults are most attracted to oatcakes

Pensioners and Older Adults not attracted by the snacking format

Pensioners and Older Adults not attracted by the snacking format

Lifestage segmentation: oats products(12 wks to 16 Nov 08

Young adults are least attracted to oatcakes

Young adults are least attracted to oatcakes

0

50

100

150

200

250

Oat Based Biscuits Oat Cereals Bar Oatcakes

Source : © dunnhumby 2008

Convenience Finer Foods Healthy Mainstream Price Sensitive Traditional

Finer foods and Healthy shoppers are the most attracted

by the category

Finer foods and Healthy shoppers are the most attracted

by the category

Lifestyle segmentation: oats products (12 wks to 16 Nov 08)

0

100

200

300

400

500

600

Oat Based Biscuits Oat Cereals Bar Oatcakes

Source : © dunnhumby 2008

Northern Ireland Borders Southern Wales and the West Yorkshire Central Scotland East EnglandLancashire London Midlands North East Northern Scotland South West

Results are strongly skewed towards Scotland

Results are strongly skewed towards Scotland

Regional segmentation: oats products (12 wks to 16 Nov 08)

Appendix

the dunnhumby data

• 2yrs of weekly supermarket purchases

• 1.4 million shoppers • Representative of 40% of UK households

• Over 30,000 food products

• Segmented by;•Lifestage (young adults, young families, older families, older adults, pensioners)•Lifestyle (Up-market, Mid-Market and Less Affluent shoppers)•Region (13 TV advertising regions)

The dunnhumby data: Lifestage Segmentation

Lifestage segment

Young Adults

Older Adults

Young families

Older families

Pensioners

Mixed

Age & family

Adults aged 20-39 with no children

Adults aged 40-59 with no children

Adults with all children under 10

Adults with one or more child over 10

Adults over 60with no children

Multigenerational households

%shoppers

16%

14%

15%

16%

9%

28%

The dunnhumby data: Lifestyle Segmentation

Lifestyle segment

Finer Foods

Healthy

Convenience

Price Sensitive

Mainstream

Traditional

Key Characteristics

time conscious, enjoy luxury products and are willing to experiment

interested in organic, environmental benefits, low fat/sugar and calorie conscious

regard food as fuel, are busy and rely heavily on the microwave

look primarily for value and rely on staple foods

enjoy the art of cooking but rely on a fixed shopping list so less likely to buy on impulse

%shoppers

17%

9%

22%

16%

26%

10%

have broad tastes, favour established brands and are influenced by the needs of children

The dunnhumby data: Regional Segmentation

ISBA (TV advertising) regions

• North Scotland – STV North (Aberdeen, Dundee)• Central Scotland – STV Central (Glasgow, Edinburgh)• Borders – Border Television• North East – Tyne Tees Television• North West/ Lancashire – Granada Television• Northern Ireland - UTV• Yorkshire – Yorkshire Television• Midlands – Carlton Central• East England – Anglia Television• London – LWT• Wales and the West – HTV Wales & HTV West• South and South East – Meridian Broadcasting• South West – Carlton West Country

The dunnhumby data: Regional Segmentation

Region

London

Midlands

Southern England

Lancashire (NW)

East of England

Wales & the West

Region

Scotland

Yorkshire

South West

North East

%shoppers

20%

15%

11%

10%

9%

9%

%shoppers

9%

8%

4%

3%

3%Northern Ireland

Contact Details: HGCA

• For further Information about how your business can obtain more information like this please contact:

Rachael ArdingHGCA Market Development Project Executive

Email: Rachael.Arding@hgca.comTelephone: 020 7520 3930

Contact Details: VCR² and Kent Business School

• For further information about the Centre for Value Chain Research at Kent Business School, please contact:

Melanie FelgateCentre for Value Chain Research, Kent Business School,

University of Kent, Canterbury, CT27PEEmail: m.felgate@kent.ac.ukTel: 01227824766Website: www.kent.ac.uk/kbs/cvcr

Contact Details: VCR² and Kent Business School

• For further information about the Centre for Value Chain Research at Kent Business School, please contact:

Professor Andrew Fearne Centre for Food Chain Research, Kent Business School, University

of Kent, Canterbury, CT27PEEmail: a.fearne@kent.ac.ukTel: 01227824840Website: www.kent.ac.uk/kbs/cvcr

Thank you