nppc on-pack label initiative: selling at the moment of truth · 2014. 9. 16. · selling at the...

National Pork Producers Council 2/1/2010 1

NPPC On-Pack Label Initiative:

Selling at the Moment of Truth


Today’s Meeting

The Consumer Decision Process

On-Pack Marketing

Label Impact Study

Action Plan


Source: NPD

The Dinner Dilemma

It’s 4:30 PM. And 60% of Americans have no

idea what to serve for dinner


The Dinner Dilemma

The customer is starting to think about

center of the plate options


Consumers Take the Time to Browse

A majority of shoppers take the time to browse

down most aisles.

Source: POPAI Consumer Buying Habits Study, 1995

How Shoppers Go Through The Store

Only Visit

Aisles/Sections

Where

Planned to Buy

42%

Visit Each

Aisle/Section

21%

Visit Most

Aisles/Sections

37%


Fresh Meat Is a Key Supermarket Category

Fresh meat is the third most likely item found in the

supermarket shopping basket

Source: : POPAI Consumer Buying Habits Study, 1995

% of Shoppers Purchasing

90%

60%

30%Produce Packaged

Breads

Fresh Meat/

Seafood

Milk Soft

Drinks

83%

54% 52%49%

42%


Importance of the Meatcase

Well over half of

all consumer

purchases are

spent on

perishables

Meat & Seafood

department

represents over

31% of perishable

sales and nearly

16% of total store

sales

Source: Progressive Grocer Annual Report, 1998

Produce

21.1%

Meat & Seafood

31.3%

Bakery Foods,

Packaged 5.9%

Dairy

Products

17.9%

Deli 6.4%

Frozen Foods

10.6%

Ice Cream 3.2%

In-Store

Bakery

3.9%

Percentage of $ Sales


Source: POPAI Consumer Buying Habits Study, 1995

Meat Is a Key In-store Decision Category

Nearly half of all

in-store meat

purchase

decisions are

made on

impulse

20

30

40

50

Meat/Seafood Produce

In-Store Decision Rates

%

47%

33%


On-Pack Marketing Impacts Sales

Well-designed packages can act as “five-second commercials” for a product

Only on-pack marketing can serve as the “last three feet” of a marketing effort

Where the product, the consumer and the dollars come together


On-Pack Marketing Communications

On-pack marketing communications are

those packaging components which can

influence purchase behavior including:

- recipes

- preparation tips

- coupons (on-packs, in-packs, IRCs)

- tie-in promotions

- bonus packs


Effectiveness of On-Pack Marketing

Nearly three-quarters of consumers bought an

item because of on-pack marketing

Source: The In-Store Experience, Seiden Group, 1994

% Consumers Ever Bought After Seeing

80

%

60

40

20On-Pack Displays Samples Checkout

Coupons

Shelf

Coupons

Frequent

Shopper

Program

72%

65%62%

55%

35%31%


Source: NFO Kitchen Report, 1998

How Often Households Use Recipes

Often 33%

Always 5%

Never 5%

Sometimes 57%

Recipes Are Very Important

95% of households use recipes


Source: NFO Kitchen Report, 1998

Packages are an Important Recipe Source

Most consumers use food package recipes

Cookbooks

0

Magazines/

Newspapers

Friends/

Family

Food

Packages

TV Internet Restaurants

30

60

90

%Household Recipe Sources

87%

71% 70%

51%

14%8% 7%


On-Pack Recipes Are Important Packaging Components


And Preparation Tips Are Essential


0 20 40 60

Cost

Time available

Who will be eating

Food quality

Availability of Ingredients

Nutrition

Prep Time

Weekdays

Source: The 1996 Gallup Study of Dinner Eating Habits

Preparation Time Is Key to Communicate

Prep time is tied with nutrition as most important in

deciding what’s for dinner

% Respondents Ranking First or Second Most Important

53%

53%

49%

49%

44%

34%

32%


Consumers Need Preparation Tips

Roughly 50 million people (30% U.S. adults) are

not confident or satisfied with their ability to fix a

meal

Consumers are less comfortable preparing pork

than other species

47% of consumers overcook meat or poultry due

to concerns about food safety

However, advertising has significantly improved

the comfort level of preparing pork

Sources: www.foodchannel.com; MARC, 1998; Better Homes & Gardens Consumer Panel, 1997-98


Label Impact Study


Label Impact Study: Overview

The pork industry has long recognized that

on-package recipes appeal to consumers

and in-turn increase sales, yet had little or

no data to support such a case

As a result, NPPC recently conducted a

comprehensive research study to quantify

the actual impact on retail sales by adding

recipe labels


Label Impact Study: Overview (cont’d)

A two-phased research approach:

- Qualitative: Focus groups to determine

consumer attitudes and needs

- Quantitative: Control store test to

determine impact on

sales


Label Impact Study: Qualitative Results

Consumers would enthusiastically welcome

recipe labels on fresh pork packages

Recipe labels would encourage additional

purchases of pork

Prefer these label elements:

- color versus black and white

- quick, easy-to-prepare recipes

- clear, concise copy



When exposed to a “Pork. The Other White

Meat.®

” on-pack label, consumers were

reminded of:

- the “well-recognized” advertising campaign

- the message that pork is an alternative to

chicken and or healthier than they thought



As a result of the focus group findings, the

NPPC developed three sets of recipe labels

to explore through quantitative research their

incremental volume potential


Label Impact Study: Tested Label Types

Test cell 1: peel-off label Test cell 2: multi-recipe/

Test cell 3: single recipe w/photo(2 labels: chops/roasts)


Label Impact Study : Quantitative Approach

A controlled store test was conducted

among two key geographically-dispersed

retail chains

This approach is a widely used in-store

technique that here identifies incremental

sales from on-pack recipe labels

- separates the sales impact of recipes from

other marketing events, such as features,

displays and pricing


Label Impact Study : Quantitative Approach

The test was conducted October/

November 1998

Three test cells were compared to a control

cell, with a total of 32 matched stores

Compliance was monitored through audits

by an independent agency

Meat department managers were also

given the opportunity to provide feedback

on the program


Label Impact Study: Quantitative Results

Overall, recipe labels

had a significant,

positive impact on

fresh pork sales

0

2

4

6

8

Average Gain

%

6%

Source: Label Impact Study, NPPC 1998


0

5

10


7% 7%

5%

Peel-Off

RecipeMulti-Recipe Single Recipe:

Chops/Roasts

There was not a

significant

difference in

results between

the different types

of labels



Not surprisingly, results are stronger for

roasts and tenderloins

Impact on Sales, by Cut Type

Chops

Roasts

Tenderloins

+ 5%

+ 7%

+ 13%

Test

Advantage*

* composite results



Projecting Incremental Sales and Profit*

Incremental Sales*

Incremental Profits*

$ 354

$ 120

$17,940

$ 6,240

$1,794,000

$ 624,000

Weekly,

Per Store*Annualized,

Per Store*

Annualized,

for 100

Unit Chain*

* based on industry composite, rounded, (weekly pork sales of $5,900 per store; 34% gross margin)

Projecting long-term results demonstrates

significant sales and profit improvement


Label Impact Study: Forecast

Projecting Incremental Sales and Profit*

Enter the chain/account information

Enter Average Weekly Dollar Pork Sales $5,000

Enter Number of Stores In Your Chain 300

Enter Number of Annual Program Weeks 52

Enter Gross Margin (I.e. .34 for 34%) 34%

Incremental Sales Per Store/Week $300

Incremental Profits Per Store/Week $102

Incremental Annualized Sales Per Store/Week $15,600

Incremental Annualized Profits Per Store/Week $5,304

Incremental Annualized Chain Sales $4,680,000

Incremental Annualized Chain Profits $1,591,200

Enter

Chain

Info


Label Impact Study: Meat Manager Feedback

Many managers expressed warm reception to

the NPPC recipe label program:

- “Labels give the customer recipe and cooking

ideas, which will only increase sales of our pork

displays.”

- “The program is good for my department, adding

a touch of „class‟ to each pork loin package…

applying recipes tells Mrs. Consumer that we

appreciate her shopping with us.”

- “[The label program] is helping to sell more pork.”


Label Impact Study: Conclusions

Recipe labels have a positive and

significant impact fresh pork sales

- influence in-store decision

Consumer needs are addressed

- how to use

- variety

The potential to increase store traffic and

cross promote


Why Retailers Should Invest in On-Pack Recipes?

Satisfies consumer need to determine what to prepare for dinner

Educate consumers on how to prepare pork

Customer retention and loyalty

An opportunity to further brand the meatcase

Increase center-store traffic via cross-merchandising with ingredients

Increases sales & profits of the most profitable segment of the meat department


Use on-pack recipe labels as an integral part

of a pork merchandising plan

Educate staff on the benefits of recipe labels

Periodically monitor in-store performance

Act now…before your competition!

Retailer Next Steps

nppc on-pack label initiative: selling at the moment of truth · 2014. 9. 16. · selling at the...

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