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HOW DAIRY PACKAGING KEEPS PACE WITH A NEW GENERATION OF SNACK-HUNGRY CONSUMERS Bemis Europe - Chasing Cheese Snackers CHASING CHEESE SNACKERS

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Page 1: Chasing Cheese Snackers

HOW DAIRY PACKAGING KEEPS PACE WITH A NEW GENERATION OF SNACK-HUNGRY CONSUMERS

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CHASING CHEESE SNACKERS

Page 2: Chasing Cheese Snackers

© 2016 Bemis Company, Inc. 04/16

03 Moving Away from Traditional Meals

04 The Search for Protein

05 Food for Thought: Benefits of New Formats

06 Unwrapping the Power of Portions

07 Food for Thought: Keeping it Simple for Busy Consumers

08 Sensing Success

09 Flavors That Matter to Millennials

10 Finding Profit in Pairings

11 More Profitable Dairy Packaging Starts Today

CONTENTS

© 2016 Bemis Company, Inc. 04/16

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Page 3: Chasing Cheese Snackers

© 2014 Bemis Company, Inc. 02/14

Longer workdays, more social commitments and less downtime are impacting more than just consumers’ daily schedules — they are revolutionizing their mealtime, too.

Traditional sit-down breakfasts, lunches and dinners are becoming a rarity for busy consumers who find themselves time-stretched and willing to skip meals on a regular basis.

Many consumers today are more likely to grab a snack than to take time out for a traditional meal.

» The snacking industry, in Europe amounts to €167 billion, making it the highest contributor to the worldwide sales of snack food. 1

» 69% of Europeans snack so that they can satisfy hunger between main meals. 2

»44% of Europeans say that they eat snacks as a meal replacement. 3

MOVING AWAY FROM TRADITIONAL MEALS

€ 1,000 billion EU household expenditure on food and drink products.

1, 6 FoodDrinkEurope, Data & Trends, 2013-2014; 2, 3, 4, 5 Nielsen Global Snacking Survey, q1 2014 Nielsen;

Going Back to BasicsWith more consumers spending time away from home, portability is a key consideration.

» 45% of global consumers of snacks said that all natural snacks are important 4, while 31% cited that snacks high in protein were important to them. 5

» EU household expenditure on food and drink products is at aproximately €1,000 billion. 6

The implications for dairy processors are clear: Gaining market share means tapping into emerging snacking trends and targeting on-the-go consumers with creative products and packaging that complement their changing tastes and lifestyles.

In this eBook, we’ll explore how dairy professionals can stay ahead of the game with today’s consumers.

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When consumers think about grabbing a snack, there’s a good probability it will be cheese. In Europe, cheese is the third most popular snack choice behind chocolate and fresh fruit. It is preferred over vegetables and cookies. 7

More Cheese, PleaseSo why are consumers reaching for cheese?

First, it’s affordable and made from high-quality ingredients according to 53% of consumers surveyed. Additionally, cheese provides high perceived nutritional value including protein intake (31%) and also the use of organic ingredients (34%).8

Protein, in particular, is a key draw for 18+ year olds looking for a quick energy boost. A recent survey showed that 98% of European respondents consumed milk and dairy products daily. 9

THE SEARCH FOR PROTEIN

7, 8 Nielsen Global Snacking Survey, q1 2014 Nielsen, 9 FoodDrinkEurope, Data & Trends, 2013-2014; 10 Mintel Food and Drink, 2016.

PROTEIN ON THE RISEHigh protein snack categories are outpacing traditional snack categories according to 2014-2015 data.

Source: IDDBA and Nielsen Research

Finally, cheese can be delivered in endless formats and portion sizes, making it the quintessential on-the-go snack food for kids, teenagers, adults and seniors alike.

+11.2%

+7.7%

+ 4.5%

CHEESE SNACKS

MEAT SNACKS

TOTAL SNACKSOrganic Valley Snack Sticks

Over 1/3 of German cheese consumers eat cheese as an alternative to meat.10

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© 2014 Bemis Company, Inc. 02/14

FOOD FOR THOUGHT: BENEFITS OF NEW FORMATSPortion control, portability and protein are quickly becoming the “3 P’s” of snacking.

One processor, BelGioioso® Cheese, has combined all three in its new line of snacking products, and has reaped the rewards of being on top of this snacking trend. BelGioioso’s Fresh Mozzarella Snacking Cheese product has delivered a 41% increase in price per ounce versus 8 oz. Mozzarella. And over the past year they experienced a 73% increase in unit sales.

Since launching the hugely successful Fresh Mozzarella product, BelGioioso has extended its product line with launches of Snacking Fontina, Mini Mascarpone and Mini Ricotta.

Source: IRI Comparison of BelGioioso 1 oz Mozzarella Snacking Cheese vs 8 oz fresh mozzarella as of 2/21/16

IRI data includes scanner sales from Grocery Retailers larger than $2MM per year (roughly 85% of the total market). Aldi, Costco, and Whole Foods do not participate in IRI data and are not included.

Fresh Mozzarella Snacking Cheese Fontina Snacking Cheese

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When it comes to snack packaging in general—and dairy packaging in particular—one size does not fit all. A full 27% of consumers say that portion control is “very important.” 10

Portion control is critical for snacks like cheese because it keeps the product fresh and ensures the serving size is appropriate. "Women especially say they do not want oversized portions." 11

Today, forward-looking cheese processors are exploring innovative packaging formats that offer portioned sizes and recloseable features that appeal to on-the-go lifestyles. Freshness, convenience and portability are all key advantages of this trend.

UNWRAPPING THE POWER OF PORTIONS

10, 11 Nielsen Global Snacking Survey, q1 2014 Nielsen; 12 Mintel; 13 Mintel: Spotlight on Natural, 2015

REDUCING FOOD WASTEPackaging that delivers smaller portions offers an additional, yet vital, benefit. It helps to minimize food waste by ensuring more product is consumed rather than disposed.

Source: http://www.unep.org/wed/2013/quickfacts; Ameripen.org,

“Discover the Hidden Value of Packaging”

Sampling on the RiseAnother key consideration is sampling. In fact, 70% of consumers would buy more cheese if they could sample it first.13 Smaller portions allow these adventurous consumers to taste new products without feeling like they must commit to a full-sized package. Portioned packaging gives them flexibility and peace of mind to sample cheese varieties guilt-free.

A third of consumers believe there are not enough conveniently packaged snacks on the market.12

According to the United Nations Environment Program, up to 30% of food produced globally goes to waste.

Studies by the Council for Packaging and the Environment show that packaging accounts for just 7% to 10% of a product’s total environmental impact—making food waste a far more important concern than packaging waste.

30%GLOBAL FOOD WASTE

ENVIRONMENTAL IMPACT OF PACKAGING

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FOOD FOR THOUGHT: KEEPING IT SIMPLE FOR BUSY CONSUMERS Consumers are always on the lookout for better portion control and convenience. The right flexible packaging format can help. Shrink Rollstock, for example, provides a clean, easy-to-read appearance on small packages or complex shapes that is not possible with traditional shrink bags. It can also be enhanced to offer easy opening for snackers who want to save time.

In addition to improving consumer experience, shrink rollstock for portioned cheese can help companies reduce labor and leakers by up to 50%, while increasing throughput up to 10%.

Sargento® Tastings®

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As dairy processors roll out bold, new flavors and more desirable product portions, one key element of the marketing plan remains the same: make the package as dynamic as possible.

Regardless of advertising or external promotions, 73% of purchase decisions are made at the point-of-sale. Therefore packaging must appeal to consumers’ senses to stand out on crowded retail shelves.

73% of purchase decisions are made at the point-of-sale.14

From Visual to Textured InksWhen a busy mother picks up two cheese packages to compare side-by-side in the grocery store aisle, a package that incorporates creativity in labeling, formats, visuals and even textured cues will help drive her decision.

SENSING SUCCESS

Packaging should reflect the brand experience, and since consumers are more willing to experiment with the foods they eat, manufacturers should employ new techniques to convey flavor, product texture and scent.15

The right packaging can deliver surprise—as well as a more intense experience for the consumer. When this physical and sensory experience is successful, dairy brands benefit from deeper consumer connections.

14 Contract Packaging Association, 2014 Conference “2014 Packaging Trends” by digital surgeons creative agency; 15 Mintel Trend: Sense of the Intense

PRINT TECHNIQUES THAT PROVIDE SENSORY APPEAL

Sartori MontAmoreA parchment paper look/feel

delivers a premium appearance.

Arla DofinoThis highlight technique juxtaposes a glossy logo with a matte package.

This package is also resealable.

Old CrocA matte black overprinting technique helps this package pop off the shelf

next to traditional competitors.

PACKAGING DRIVES PURCHASE

PACKAGING ONLINE FRIENDS TELEVISION

37% 31% 27%31%

Contract Packaging Association, 2014 Conference “2014 Packaging Trends” by digital surgeons creative agency

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FLAVORS THAT MATTER TO MILLENNIALSToday, Millenials make up 24% of the entire population of the EU.16 These Millennials have significant economic clout. They also have a much different flavor palette than their parents.

Ready for IntensityFor example, spicy and intense flavors have gained newfound popularity with this audience. Jalapeno, ginger and garlic are increasingly common in snack products and packaged foods.17 This quest for more daring tastes and textures creates unprecedented opportunity for new product research and development. It is critical that the package draws attention to these new flavors.

PAIRINGS ON THE RISEPre-packaged food pairings are gaining considerable market share with consumers of all ages. Refrigerated trays, for example, have grown 14% over the past year—seeing both unit sale increases and new product launches.19 Snack cheese categories have grown 7.7%, with 4.2% growth in traditional formats such as stick or string cheese. 20, 21

Refrigerated Tray +14.0%19

Stick and String Cheese +4.2%20

16 Pew Research Center, Global Attitudes, 2014; 17 “Mintel, Millennial Dining Habits 2014”; 18 Mintel: Spotlight on Natural, 2015;

At the same time, Millennials are looking for portability and multi-serve options (in the same package) that give them the opportunity to take food on-the-go or share with friends. Taste, flavor and convenience are all prerequisites in whichever product they purchase.

Finally, Millennials are information seekers. They crave data and knowledge about the foods they consume. So it’s no surprise that 53% say stores should provide more cheese flavor profile and pairing information.18 Packaging can play a vital role in delivering this kind of information at the point of purchase.

REFRIGERATED PAIRINGS OUTPACE TRADITIONAL CHEESE SNACKS

19 IRI: Refrigerated Trays Meat/Cheese/Crackers/Dessert latest 52 weeks ending 2/21/16; 20 IRI: Latest 52 Weeks ending 12/27/15; 21 IDDBA: What’s in Store 2016, Nielsen;

IRI data includes scanner sales from Grocery Retailers larger than $2MM per year (roughly 85% of the total market). Aldi, Costco, and Whole Foods do not participate in IRI data and are not included.

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© 2014 Bemis Company, Inc. 02/14

FINDING PROFIT IN PAIRINGSMany companies are reaping the rewards of offering food pairings based on consumer taste trends.

22 IRI: Hillshire Snacking latest 52 weeks ending 2/21/16; product launched July 2015; 23 IRI: Latest 52 weeks ending 2/21/16; 24 IRI: Latest 52 weeks ending 2/21/16

IRI data includes scanner sales from Grocery Retailers larger than $2MM per year (roughly 85% of the total market). Aldi, Costco, and Whole Foods do not participate in IRI data and are not included.

KRAFT® P3™

$79.8 million in sales over past year23

HILLSHIRE® SMALL PLATES™

More than $10.5 million in sales in first six months22

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© 2016 Bemis Company, Inc. 04/16

MORE PROFITABLE DAIRY PACKAGING STARTS TODAYAre you ready to gain more market share in the rapidly changing dairy market? Are you looking for more from your packaging supplier than simply packaging? We have the market insights and transformational strategies that can help you capitalize on today’s emerging trends. Take the next steps today:

1. Find a better way to boost consumer demand. Let’s connect about global insights and on-the-pulse consumer trends to spark creativity.

2. Accelerate your speed to market. Create a physical or virtual prototype to help you bring the right product to market. Learn about the Bemis Innovation Center at www.bemis.com/bic-tour

+32 2 238 [email protected]/europe

We are here to help you be successful. Contact us today!

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