FreshIncite May 2016

What We’re Seeing

Snack Food Giants challenged by healthy consumer Top

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Increasing consumer health concerns about processed drinks and snacks have led to responses from Mars, Dolmio, Coco-cola and Arnott’s. Market pressure has prompted a range of responses from these giants of the drinks and snacks sector and with mixed results.  

Mars and Dolmio are now recommending consumption of their product weekly or occasionally – a big change from ‘a mars a day’. Coca cola have committed to product integrity but moved to lower soft drink prices in response to the increased competition from water and coffee. Arnott’s have taken a different approach and changed the ingredients on “Shapes”, earning a health star rating by removing salt and saturated fat, but sparking a customer backlash.

Market pressure is calling for action and it remains a challenge to respond to potentially aspirational health concerns, while maintaining a strong food business. 

It will be difficult for the snack food giants to become healthy quickly and maintain their core customers. It does seem like they will be drawn into more complicated offers and brands to cater for what appear to be quite different sets of needs.  

New varieties could take Mandarins above $200m Top

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Two new mandarin varieties have been developed by Queensland’s DAFF.  Currently the mandarin retail category value is approaching $200m in annual retail value, and the injection of these new seedless varieties at complementary seasonal supply windows, could lift the mandarin value further.

Mandarins are being seen by consumers as a healthy snack that can be eaten on the run. They have a robust citrus durability and the easy peal nature makes them a favourite for lunch boxes. They are also injecting new products into the limited winter fruit range, which could offer potential for incremental fresh fruit sales.

Mandarins that expand the current season supply window have clear scope to increase category value.

Households still eating dinner together Top

household_graph_3.pngDespite busy schedules and other challenges, having dinner together at home is still commonplace.

Currently, 72% of households eat most or all dinners together, according to Freshlogic’s consumer MealpulseTM results.  It is most common among households with children, whether Established Families or Budgeting Families (84-85%), and least common among High Income Singles and Couples (63%). Low Income Singles and Couples (68%) and Empty Nesters (69%) share similar results.

Eating most or all dinners together has declined from 75% four years ago, while living alone and eating alone has increased slightly from 10% to 12%. Eating alone is more common among Empty Nesters (24%) and Singles and Couples (16-18%). 

Regardless of whether dinner takes place around the dinner table, in the lounge or in other settings, eating food together remains a significant part of the household routine, and this has implications for retailers and other food providers alike.

The Food Consumer

Berries rise to $700m Top

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Consumer demand for berries in Australia has elevated interest in the category. The combined berry category is worth over $700m at retail and enjoys a strong consumer acknowledgement of their health attributes, as well as being a highly convenient ready to eat product. Strawberries and Blueberries lead the wider berry category in terms of volume, and they both benefit from regular inclusion in retail “multi-buy” promotional activity that can only help expand home use.   

Globally the patterns are similar, with the retail category value of berries competing with apples in UK for the #1 fruit by value. In the U.S, the Department of Agriculture confirmed consumer demand by announcing that blueberry consumption has increased fourfold from 2000 – 2012.

This local performance has now drawn interest from international suppliers with Korean strawberries poised to be imported. This additional supply is concerning some local growers due to risks of varied quality disrupting what has been a stable growth category.

Berries align well with today’s consumers needs and no doubt are recognised by retailers for the value growth they can generate.  These optimum conditions have now drawn interest from suppliers outside of Australia. 

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Freshincite is a publication prepared by Freshlogic

Freshlogic is a specialised provider of food market insights and analysis, with deep expertise in the dynamics of fresh foods. We deliver a range of services to industry and corporate clients, which aim to interpret market and supply chain conditions, or address challenges faced in food supply chains associated with changes in the preferences of consumers, supply dynamics, and economic settings.

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