APPENDIX E Datamonitor 2011. Soft Drinks in Australia

APPENDIX E

Datamonitor 2011. Soft Drinks in Australia

Available: http://360.datamonitor.com.ipacez.nd.edu.au/Product?pid=889413C8-178F-43C0-8BD7-4FD8C32C0B1F.

Accessed: 05 March 12.

E.1

(Might mean that this segment reduces the amount of Cola products purchased as a ‘mixer’ as they consume pre-mixed drinks).

The presence of big supermarket chains increase buyer power⁵⁹.
Consumer confidence has slipped in the last quarter with more Australians apprehensive about economic uncertainty, financial security, and rising gas and electricity prices. The latest results for the Nielsen Global Online Consumer Survey undertaken in June, shows that Australian consumer confidence has slipped three points to 108 in the second quarter of 2010 compared to the previous three months; with 36 per cent of consumers having a pessimistic view of the state of their personal finances over the next 12 months (up six points from Quarter 1); and only half (50 per cent) saying the next 12 months is a good/excellent time to buy what they want and need – the lowest this score has been over the past four quarters.

Increasing utility bills was by far the biggest concern among Australian consumers, with 30 per cent citing it as a major concern over the next six months – up 10 per cent compared to a year ago. In addition, two-in-three consumers (65 per cent) said they had already taken action to try and save on gas and electricity over the past year, and even when economic conditions improve, saving on gas and electricity was the number one action cited to reduce household spending⁶⁰.

This behaviour has been observed in Australia with shoppers increasing their store repertoire. Furthermore, 30 per cent of Australian shoppers claim ‘they will still look for cheaper grocery brands even though the GFC is over’ (Nielsen Global Consumer Confidence Survey, June 2010)⁶¹.

hold expenditure by trying to save on gas and electricity; cut- ting back on take-away meals, new clothes purchases and out-of-home entertainment, and making the switch to cheap- er grocery brands⁶².

A strong labour market and perceived financial position may be driving up our confidence, but in reality, while we are also seeing a return in business confidence among grocery manufacturers – it has been tempered somewhat by the sluggish growth performance of the grocery channel overall (value sales growth for total grocery excluding tobacco dropped from a healthy 7.8% for the Moving Annual Total (MAT) 16 August 2009, to just 3.6% for the same period this year).

This was driven by a combination of continued deep discounting by the retailers, a 5% fall in value for grocery baskets compared to a year ago, and the rise of the savvier shopper who is continuously on the hunt for “value for money”. Private label perception in the eyes of the shopper has come a long way over the past five years, with many seeing the benefits it can offer in terms of “value for money”, and as a good quality alternative to name brands⁶³.

Online Shopping: As Australians demand better deals on everything they purchase, online trading is also playing a larger role in the shopping channel mix, with the key drivers being the availability of a broader range of products and services and the ability to get products and services at a cheaper price than they are available through traditional retail channels. Among Australia’s internet population, the vast majority (96%) have made an online purchase⁶⁴.


Australian Soft drinks market.

Australian soft drinks market value between 1996 – 2001 has grown by $128.9 Mn

The latest results for the Nielsen Global Online Consumer Survey undertaken in June, shows that Australian consumer confidence has slipped three points to 108 in the second quarter of 2010 compared to the previous three months; with 36 per cent of consumers having a pessimistic view of the state of their personal finances over the next 12 months (up six points from Quarter 1); and only half 50 per cent) saying the next 12 months is a good/excellent time to buy what they want and need – the lowest this score has been over the past four quarters. Increasing utility bills was by far the biggest concern among Australian consumers, with 30 per cent citing it as a major concern over the next six months – up 10 per cent compared to a year ago. In addition, two-in-three consumers (65 per cent) said they had already taken action to try and save on gas and electricity over the past year, and even when economic conditions improve.⁶⁵ Saving on gas and electricity was the number one action cited to reduce household spending. The economy was ranked the second biggest major concern with 21 per cent of respondents – up four points in just three months – a reflection of the widespread voter dissatisfaction we have seen over the past few months. Not surprisingly, restraint and vigilance continues to be a key theme among Aussie consumers with around two-in five channelling their spare cash into savings (41 per cent), and 38 per cent of consumers channelling any surplus cash into paying off debts, credit cards and loans.⁶⁶

Furthermore, more than half of Australian consumers cited they were actively cutting down on take-away meals, out-of-home entertainment, and new clothes.⁶⁷

The key to success of retail sector lies in responding to needs of the shopper of today and the future.⁶⁸

Australian population will embark in significant changes including cultural diversity,ageing population and general population growth, understanding the impact of these changes will have on shoppers and their purchasing behaviour is critical in capitalising opportunities these trends will offer to retail sector.⁶⁹

The Shopper.

Global financial crisis(GFC) caused the shoppers to reassess how they spend and shop. There has been a fundamental shift in shopper sentiment from the spend thrift ,debt driven early noughties to a greater sense of caution and restraint post GFC.⁷⁰

• 
  The shopper has become savvy
  
• 
  The shopper buys private labels in one category and premium price brand in another
  
• 
  Private label products have been launched successfully into more and more categories .
  
• 
  Shoppers stick with brands as long as they perceived to be good enough. ⁷¹
  

Rising confidence in Australia in 2010 defied the trend of other developed markets and reflected the strongest outlook Australia has had in more than two years for job prospects, personal finances, and the ability to buy things over the next 12 months. Australia was the third most confident market globally, boasting a Consumer Confidence Index score of 115 which was 25 points above the global average of 90. An overwhelming 74% of Australians said their perception of local job prospects over the next 12 months was excellent or good; 70% believed that the state of their personal finances was positive; and 59% (the highest score globally) claimed the next 12 months was an excellent or good time to buy the things they wanted and needed.

The results are consistent, with the continued rise in Australia’s employment growth fuelling a strong labour market and underpinning household income. Our economy also benefited from expansion over the first half of 2010 with Gross Domestic Product (GDP) growth forecast to be around 3.25% for the year – a result of rising commodity prices, increased public investment and a growing population.⁷²
The Demanding Consumer

“Hard times have a way of transforming consumers and the past couple of years have been harder than most. While the Australian economy emerged in 2010 relatively unscathed from the GFC, the downturn has left an indelible impression on consumers’ attitudes and purchasing behaviours.

During the economic downturn, consumers shopped around for specials to cut costs, and this has created a new, savvy consumer who is more demanding than ever. Despite the positive outlook among Australians, we are still seeing evidence of f cautionary behaviour, with almost half of all consumers channeling their spare cash into savings (47%), and 40% using surplus cash to pay off debts, credit cards and loans.

Plus, the majority of consumers are curbing their household expenditure by trying to save on gas and electricity; cutting back on take-away meals, new clothes purchases and out-of-home entertainment, and making the switch to cheaper grocery brands. A strong labour market and perceived financial position may be driving up our confidence, but in reality, while we are also seeing a return in business confidence among grocery manufacturers – it has been tempered somewhat by the

sluggish growth performance of the grocery channel overall (value sales growth for total grocery excluding tobacco dropped from a healthy 7.8% for the Moving Annual Total (MAT) 16 August 2009, to just 3.6% for the same period this year).

This was driven by a combination of continued deep discounting by the retailers, a 5% fall in value for grocery baskets compared to a year ago, and the rise of the savvier shopper who is continuously on the hunt for “value for money”.

Australian shoppers are prepared to shop around for the best deal. The average shopper repertoire now includes about four different stores in a week. In fact, it’s estimated that more than

30% of all Australian grocery purchases are made on promotion. Aside from heavy retailer promotional activity, we are seeing a decline in the amount spent per shopping trip – from $49.80 in 2009 to $48.40 this year; and each of these trips have become more rational with a 5% increase in the purchase of items costing less than $5, while the purchase of items priced between $10-15 has declined by 4%.”⁷³

Private label perception in the eyes of the shopper has come a long way over the past five years, with many seeing the benefits it can offer in terms of “value for money”, and as a good quality alternative to name brands. Private label continues to steadily gain traction with its representation in all of the major grocery retailers, recording an increase in value share for the quarter to 2 October 2010, to just under a quarter (23.9%) of total supermarket sales. Nielsen Homescan indicates that everybody buys private label products (100% household penetration), with the average household spend reaching over $200 for the first time ever in the latest quarter – up $3.48 on the previous quarter.
Online Shopping

“As Australians demand better deals on everything they purchase, online trading is also playing a larger role in the shopping channel mix, with the key drivers being the availability of a broader range of products and services and the ability to get products and services at a cheaper price than they are available through traditional retail channels. Among Australia’s internet population, the vast majority (96%) have made an online purchase.”⁷⁴

“Cultural diversity from changing immigration, population growth and ageing consumers is set to impact Australian retailing in the next four decades. Key insights from the 2010 Nielsen ShopperTrends Report reveal that the Australian shopper is evolving, and to succeed in the future, retailers and manufacturers will need to develop strategies that accommodate growing ethnicity, population increases and an ageing society. Nielsen research shows that among Australian households in 2010, Thai cuisine was the second most popular eaten out-of-home (after traditional Australian); followed by Italian, Chinese and Japanese. Asian food items in Australian family pantries has grown by 268,000 households since 2007. This represents an opportunity for grocery marketers to provide simple and convenient Asian meal solutions. From a marketers perspective, it is

important to understand how ethnicity impacts on how people shop and demand for products and brands – which products and brands consumers are looking for and where they expect to find them.

Over the past 50 years Australian households have been adopting Mediterranean cuisine as part of their everyday menu, with ingredients available in both supermarkets and specialist retailers. Now, as migrant ion shifts from European count rise towards Asian countries, there is a need to understand how these influences will change the way Australians shop, what they buy, where they buy it from and what they eat.”⁷⁵

“In the 12 months to 30 June 2010, Australia's population increased by 377,100 people, reaching 22,342,000. The annual growth rate for the year ended 30 June 2010 (1.7%) was lower than that recorded for the year ended 30 June 2009 (2.2%).”⁷⁶

Table: ¹

“At June 2010, the median age of the Australian population (the age at which half the population is older, and half is younger) was 36.9 years, up from 36.5 years in 2005. The median age of males increased from 35.7 to 36.0 years and the median age of females increased from 37.3 to 37.8 years over this period.

The SD with the lowest median age at June 2010 was Northern Territory - Bal (29.4 years), followed by North West in Queensland (29.9) and Kimberley in Western Australia (30.7). The highest median ages were recorded in Yorke and Lower North in South Australia (46.5 years), Mid-North Coast in New South Wales (44.6) and Southern in Tasmania (44.2).”⁷⁷

“At June 2010, there were 15.09 million people of working age (15 to 64 years), an increase of 1.36 million or 9.9% since June 2005. The proportion of the total population in this age group increased marginally from 67.3% to 67.6% over this five-year period.

The Northern Territory had the highest proportion of people of working age at June 2010 (71.4%), overtaking the Australian Capital Territory (71.2%) for the first time in over 20 years. Tasmania continued to have the lowest proportion (65.2%).

Between June 2005 and June 2010, Victoria had the largest growth of people aged 15 to 64 years (361,000), followed by Queensland (350,900) and New South Wales (339,300). Western Australia had the fastest growth of people of working age (14.1% over this five-year period), followed by Queensland (13.0%).

The SDs with the highest proportions of working age people at June 2010 were Pilbara in Western Australia (72.7%), Darwin (72.7%) and Canberra (71.2%). The SDs with the lowest proportions were Yorke and Lower North in South Australia (61.0%), Mid-North Coast in New South Wales (61.5%) and Wimmera in Victoria (61.9%).”²

Adults aged 19 years and over

Food intake

Non-alcoholic and alcoholic beverages accounted for over 60% of total food and beverage intake, by weight, for adult Australians (2,460 g for men and 2,020 g for women). The contribution of beverages to the total weight of food and beverage intake may have been influenced by climate and was highest in the Northern Territory (74% for men) and one of the lowest in Tasmania (59% for men). The contribution of alcoholic beverages to food and beverage intake was higher for men (10%) than women (3%) (see tables 2 and 3) ⁷⁸

Descriptions of the graphs are below the graph

There are approximately 2,721,000 people in the target profile group, in Australia.⁷⁹

These charts show the index of the target profile group compared to the average Australian in terms of Gender and Age.⁸¹

This table shows the Education Level of the target profile group.⁸²

This table shows the Work Status of the target profile group.⁸³

The average incomes of the target profile group⁸⁴

This table shows the Occupation of the target profile group⁸⁵

Discretionary Expenditure* of the target profile group⁸⁶

This table shows the Generations* of the target profile group⁸⁸

This table shows the Roy Morgan Values Segments* of the target profile group⁸⁹

This table shows the target profile group's attitudes to a range of Health and Fitness Statements⁹⁰

Profile group's attitudes to a range of Environmental Statements.⁹¹

target profile group's attitudes to a range of Finance Statements⁹⁵