Abstract
Overview
Introduction
The growing importance of snacking generally and the trend towards premiumization both highlight the growing opportunity to market higher quality snacks and beverage products. In our Industry Opinion Survey 77% of respondents felt that high quality snacks and/or drinks consumers are being given extra attention by the industry.
Scope
- A comprehensive analysis of how consumers form their perceptions of what constitutes a high quality snack or drink
- Data profiling snacking and beverage market development and how consumption varies by demographics
- A detailed focus on how consumer motivations differ for high quality consumption with Action Points pinpointing best-practice targeting strategies
- NPD analysis highlighting how to exploit gaps in the market and how to leverage the product attributes that consumers deem the most important
Report Highlights
High quality snacks and drinks are no longer just occasional indulgences reserved for special occasions. Therefore, an opportunity exists to market accessible premium which a little more special than standard fare but are marketed with a communications mix that maximizes product appeal for the mass market.
The value of premium indulgence occasions in Europe is forecast reach US$15bn in 2009, up from US$12.3bn in 2004. The US market is smaller, but growing more rapidly. Overall the trend is driven by occasion growth; the number of premium indulgence occasions in Europe and the US is forecast to increase by 45% between 1999 and 2009.
High quality consumers are looking for authenticity, difference and experience - they want to feel special. Developing products in accordance to the four factors influencing consumers quality perceptions will be fundamental in creating products that appeal to increasingly discerning, quality seeking consumers.
Reasons to Purchase
- Access unique data pinpointing the consumers snacking and beverage consumption frequencies, spend and propensity to premiumize.
- Improve your marketing by understanding how consumers construct their purchasing decisions around the theme of premium and quality.
- Strategies for more successful brand positioning to step-up the level of quality without alienating the mass-market
Table of Contents
- CHAPTER 1 EXECUTIVE SUMMARY
- The hot topic
- The future decoded
- Snacks and drinks occasions are growing
- Consumers are embracing higher quality snacks andbeverages
- High quality snacks products have a broad demographicappeal
- Time pressured, stressed consumers turn to comfortingproducts as a reward
- Premiumization is still associated with particularoccasions and locations
- Consumers quality perceptions can be grouped under fourmain factors
- High quality snacks and drinks are moreconversation-worthy
- Action points
- CHAPTER 2 THE FUTURE DECODED
- Introduction
- Premium products are no longer reserved solely forspecial occasions
- TREND: Snacks and drinks occasions are growing
- TREND: Consumers are embracing higher quality snacks andbeverages
- Key structural and situational factors illustrate andinfluence trading-up behaviors
- Mega-trend drivers are also spurring trading upbehaviors
- Value growth is exceeding volume growth in keycategories
- This trend is all the more significant given the trendtowards discounting
- The number and value of super-premium occasions isincreasing
- INSIGHT: High quality snacks products have a broaddemographic appeal
- Premium consumers are no longer confined to the highearners
- Accessibility and rising aspirations have fueled thedemocratization of luxury
- A categorys emotional importance shapes quality seekinghabits
- Consumers trade up in categories that are emotionallymeaningful
- In doing so, sacrificial consumption via hi-loconsumerism is apparent...
- The maturalism trend is an important opportunityseemingly overlooked by the industry
- Core quality seekers will vary by country and category
- Premium consumers are no longer confined to the highearners
- INSIGHT: Time pressured, stressed consumers turn tocomforting products as a reward
- Consumers are seeking small escapisms from hecticlifestyles
- Emotive reasons are important snacking motivations
- Comfort based indulgence is a growing phenomenon
- Gender habits towards comfort related indulgence differ
- High quality products in particular are associated withemotional comfort and indulgence
- INSIGHT: Premiumization is still associated withparticular occasions and locations
- Consumers tend to premiumize and indulge in the evening
- The importance of the evening occasion is related tohealth concerns giving way to indulgence needs
- Certain special occasions also trigger premiumization
- Consumers tend to premiumize and indulge in the evening
- INSIGHT: Consumers quality perceptions can be groupedunder four main factors
- Taste is the most important factor affecting highquality offerings
- Physical product attributes can influence sensoryquality perceptions
- Packaging and country of origin are more important forhigh quality products
- The halo effect of country-of-origin/associationcredentials can help enhance a premium image
- Product information is more likely to be sought fromhigh quality products
- Brand alliances act as multipliers of qualityperceptions and expectations
- How a product is made (credence quality) takes on addedimpetus for high quality offerings
- Method of production is associated with authenticity andquality
- Natural and organic is associated with quality
- Exclusivity is increasingly important to high qualityoccasions
- Healthiness is often associated with both higher qualityAND inferior taste
- Experiential quality attributes will influence repeatpurchases
- The trend towards bolder more exotic flavors is oftenassociated with superior taste and quality
- Freshness enhances the taste experience
- Consumers often equate convenience with lower qualityproducts
- INSIGHT: High quality snacks and drinks are moreconversation-worthy
- Consumers talk more about food and drinks
- Higher quality products in particular have potential tobenefit
- Consumers are more emotionally engaged by premiumproducts
- Conclusions
- Target the mass market with accessible premiumofferings
- Remain focused on leveraging the attributes consumersassociate with quality
- Introduction
- CHAPTER 3 ACTION POINTS
- Introduction
- Target the mass market with accessible premium variants
- Develop new offerings that target the masstige snacker
- Case study: understanding how Walkers Sensationssucceeded in doing this
- Align products with key indulgence occasions
- Target the evening snacking occasion
- Target the big night in or casual sharing occasion
- Align products with entertaining at-home occasions
- When the kids are away
- Target the evening snacking occasion
- ACTION: Ensure that quality is reflected by core productattributes
- Leverage the premium credentials of intrinsic productattributes
- Focus on product detail and design superiority byleveraging extrinsic information cues
- Use packaging and labels to convey detailed productinformation
- Place heightened emphasis on the authenticity ofproduction
- Prioritize communication methods that facilitatedetailed information
- Maximize the halo effect of country of origincredentials
- Develop packaging formats oozing quality andsophistication
- Create an aspirational look to capture consumersimaginations
- The general merchandizing cues should complement thepremium packaging
- Make taste and freshness key communication andfunctional objectives
- Communicate and market the products taste above allother attributes
- Focus on freshness as a key brand value and communicateit accordingly
- Target hedonistic occasions and locations
- Target event audiences
- Target cinemas and other key entertainment venues
- Target exclusive bars and foodservice venues
- Embrace word-of-mouth marketing
- Seek out new acquisition opportunities
- CHAPTER 4 APPENDIX
- Definitions
- Research methodology
- References
- Industry and news sources
- Academic sources
- How to contact experts in your industry
- List of Tables
- Table 1: The number of main meal and snackingoccasions (billions) in Europe and the US, 2004-2009
- Table 2: The average number of daily and yearlynon-alcoholic drinking occasions (including tap water), 2004-2009
- Table 3: The value (total and per capita) and growthof snacking and non-alcoholic drinks markets, 2004-2009 (US$bn and ?bn)
- Table 4: Number of super-premium occasions by category(millions), 1999-2009
- Table 5: Value of super-premium occasions by category(?m and US$m), 2003-2008
- Table 6: Industry opinion concerning the mostimportant consumer group to target with higher quality snacks anddrinks products
- Table 7: Savory snacks, confectionery and ice creamconsumption by age group and country, 2004
- Table 8: Hot drinks and soft drinks consumption by agegroup and country, 2004
- Table 9: Consumer attitudes towards the importance offinding ways to escape the pressures of everyday life, 2004
- Table 10: Consumer and industry opinion on therelative importance of core eating motivation by consumption occasiontype, 2004
- Table 11: The number of European and US snack and hot& soft drink treating occasions occurring in response to stress,2003-2008
- Table 12: The number of European and US snack and hot& soft drink treating occasions occurring in response to boredom,2003-2008
- Table 13: The number of European and US snack,alcoholic beverage and hot & soft drink treating occasions occurringas a celebration/reward, 2003-2008
- Table 14: Consumer and industry perception of therelative importance of various extrinsic quality variables, 2005
- Table 15: A summary of consumer and industryperception of the relative importance of various credence qualityvariables, 2005
- Table 16: A summary of consumer and industryperception of the relative importance of various experiential qualityvariables, 2005
- Table 17: Examples of snacking and beverage productsthat tap into the notion of accessible premium
- Table 18: Examples of manufacturers aligning productswith key indulgence moments when consumers are more likely to trade up
- Table 19: Examples of products leveraging intrinsicquality attributes
- Table 20: Products which capitalize on the growingconsumer demand for authentic consumption experiences
- Table 21: Examples of emphasizing country of origin orcountry of association to help establish a price premium
- Table 22: Examples of packaging formats complementinga products premium positioning
- Table 23: Examples of merchandizing displays thatcomplement the premium image of a product offering
- Table 24: Definitions used in this report
- List of Figures
- Figure 1: Consumers quality perceptions can begrouped under four main factors
- Figure 2: Quality exists on different levels and canbe loosely categorized by price bands
- Figure 3: The growing importance of snacking generallyand the trend towards premiumization both highlight the growingopportunity to market higher quality snacks and beverage products
- Figure 4: Survey results highlight that trading upbehaviors are growing most strongly in snacking markets, although morehigh quality snacks and drinks are being consumed on impulse
- Figure 5: Numerous structural and situational factorsalso explain why consumers are embracing higher quality products
- Figure 6: Analysis of the benefit mega-trends providesa compelling understanding of consumer need and behavioral influences onhigh quality snacks and beverage consumption
- Figure 7: The value of national confectionery marketsis exceeding volume growth, thereby indicating a trend towards premium
- Figure 8: The value of national savory snack marketsis exceeding volume growth, thereby indicating a trend towards premium
- Figure 9: The value of national bakery and cerealmarkets is exceeding volume growth, thereby indicating a trend towardspremium
- Figure 10: The value of national dairy markets isexceeding volume growth, thereby indicating a trend towards premium
- Figure 11: The value of national hot drinks markets isexceeding volume growth, thereby indicating a trend towards premium
- Figure 12: The value of national soft drinks marketsis exceeding volume growth, thereby indicating a trend towards premium
- Figure 13: Low earners are almost as indulgent as highearners in terms of purchasing behavior
- Figure 14: 40% of European and US consumers reportedthat they consumed more comforting food and drinks in 2003-04
- Figure 15: Consumer and industry opinion shows thatindulgence and mood enhancing needs take on the most importance for highquality occasions
- Figure 16: Higher quality, more indulgent snacking andbeverage occasions are more associated with evening consumption
- Figure 17: More than 50% of consumers used their homesfor entertaining more frequently during 2003-2004
- Figure 18: Consumers are more likely to consume ahigher quality product across a number of specific locations andoccasions
- Figure 19: Consumers quality perceptions can begrouped under four main factors
- Figure 20: Taste, freshness, and packaging are threeof a number of attributes that consumers and industry executivesconsider to be more important for higher quality food and drinks
- Figure 21: Consumers are spending more timeconsidering the ingredients in food and drink offerings
- Figure 22: Consumers want products designed for theirspecific needs
- Figure 23: Summarizing the impact of health andwellness on indulgence habits
- Figure 24: Nearly half of European and US consumerssought more excitement and sensations in life in 2003-2004
- Figure 25: During 2003-2004 European and US consumersincreasingly tried new food and drink products
- Figure 26: Convenience is often deemed to underminequality and health credentials of product offerings
- Figure 27: Consumers perceive that the recommendationsof others are important and more likely to rely on such communicationwhen choosing products and services
- Figure 28: The opportunity in high quality snacks anddrinks can be exploited by recognizing, understanding and capitalizingupon these trends and insights
- Figure 29: Strategies for managing country-of-origineffects
- Figure 30: High quality snacks and drinks consumersare under-targeted via hedonistic locations and occasions
