shades of green: understanding the green consumer
TRANSCRIPT
CATALINA MARKETING CORPORATION Confidential © 2006 Reproduce By Permission Only
Shades of Green: Understanding the Shades of Green: Understanding the Green ConsumerGreen ConsumerPresented September 24, 2007FMI Sustainability Task Force
Trish Brynjolfsson, Vice PresidentBeth Johnson, Director
CATALINA MARKETING CORPORATION Confidential © 2006 Reproduce By Permission Only 22Confidential Information Catalina Marketing Corporation © 2006
What you should be telling your company about Green Consumers
How much do they spend in your stores?What is the trend of Green product purchases?What is our Green shopper penetration versus the region?What are the key demographics of Green shoppers?How loyal are Green shoppers?How can we educate and inspire our shoppers?
CATALINA MARKETING CORPORATION Confidential © 2006 Reproduce By Permission Only 33Confidential Information Catalina Marketing Corporation © 2006
AgendaAgenda
Catalina Overview
Green Methodology
Trends in Green
Regional View of Green
Green and the Organic Consumer
Demographic & Loyalty Profile
Shades of Green: Consumer Facts
Call to Action: Consumer Education
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Catalina Marketing CorporationCatalina Marketing Corporation
Eight countries and 1,150 employees globally2006 revenues $466.8 MillionThree primary business segments
Catalina Marketing Services (CMS)Catalina Health Resource (CHR)Catalina Marketing International (CMI)
– Catalina’s strategy is to be the dominant behavior-based marketing solutions company wherever and whenever consumer goods and
healthcare products are sold.
– Catalina’s strategy is to be the dominant behavior-based marketing solutions company wherever and whenever consumer goods and
healthcare products are sold.
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Catalina Marketing CoverageCatalina Marketing Coverage
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Catalina Marketing Services Catalina Marketing Services
Relevance• Savings• Rewards• Information
180+ manufacturer sponsors$3.4 billion delivered annually $240 million redeemed
23,500 retail outlets 14+ billion transactions a year100 million shopper IDs; 2 years historical data71% of Supermarket ACV; including Drug and Mass
Uniquely Positioned At The Only Place And Time Where Three Uniquely Positioned At The Only Place And Time Where Three Important Constituents Interact: Important Constituents Interact:
The TransactionThe Transaction
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Green MethodologyGreen Methodology
100 million unique shopper IDs
Over 18,000 retail outlets (excludes Wal-Mart, Publix, Wegmans, Whole Foods)
Historical purchase behavior of over 3,000 UPCs of green brands in 15 non-food categories
Demographic attributes appended to 7.8 million unique shopper IDs
Data sourced through Catalina proprietary databases
Analysis performed for 52 weeks ending July 29, 2007
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WA
OR
CA
NV
ID
MT
WY
UTCO
AZNM
TX LA
MS ALGA
FL
SC
NC
ND
SD
NE
KS
MN
IA
WI
IL IN
MI
OH
KY
TN
WVVA
PA
NY
VTNH
ME
MA
NJ
CT
MD
Northwest10.8MM IDS = 11%
Northwest10.8MM IDS = 11%
Pacific12.8MM IDS = 13%
Pacific12.8MM IDS = 13%
Mountain4.9MM IDS = 5%
Mountain4.9MM IDS = 5%
Southwest7.0MM IDS = 7%
Southwest7.0MM IDS = 7%
Central2.1MM IDS = 2%
Central2.1MM IDS = 2%
North Central17.4MM IDS = 17%
North Central17.4MM IDS = 17%
Southeast5.9MM IDS = 6%
Southeast5.9MM IDS = 6%
Carolinas14.1MM IDS = 14%
Carolinas14.1MM IDS = 14%
Northeast21.2MM IDS = 21%
Northeast21.2MM IDS = 21%
Mid-Atlantic4.5MM IDS = 4%Mid-Atlantic
4.5MM IDS = 4%
Regional RepresentationRegional Representation100 Million Unique Shopper IDs
Over 18,000 Retail Outlets
Source: Catalina CheckOut Direct, 52 Weeks Ending 7/29/07
AR
MO
OK
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Leading Green BrandsLeading Green Brands15 Categories 15 Categories –– 3,000 3,000 UPCsUPCs
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Trends in Sustainable ProductsTrends in Sustainable Products
10/2/
0510
/30/05
11/27
/0512
/25/05
1/22/0
62/1
9/06
3/19/0
64/1
6/06
5/14/0
66/1
1/06
7/9/06
8/6/06
9/3/06
10/1/
0610
/29/06
11/26
/0612
/24/06
1/21/0
72/1
8/07
3/18/0
74/1
5/07
5/13/0
76/1
0/07
7/8/07
8/5/07
9/2/07
CSD
Green
Green $ Growth in Past Two Years
= +60%
Green $ Growth in Past Two Years
= +60%
Source: Catalina PACES, 108 Weeks Ending 7/22/07
CSD $ Growth in Past Two Years
= +6%
CSD $ Growth in Past Two Years
= +6%
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EcoEco--Friendly Bags Also Showing GrowthFriendly Bags Also Showing Growth
4/1/
06
5/1/
06
6/1/
06
7/1/
06
8/1/
06
9/1/
06
10/1
/06
11/1
/06
12/1
/06
1/1/
07
2/1/
07
3/1/
07
4/1/
07
5/1/
07
6/1/
07
7/1/
07
Source: Catalina Connection Builder, Period Ending 7/29/07; Sample size 1million ID
Average Bag Consumer
• 30 Trips in 26 Weeks
• $40 Average Order Size
• Income <$50,000
• 45+ Years Old
Average Bag Consumer
• 30 Trips in 26 Weeks
• $40 Average Order Size
• Income <$50,000
• 45+ Years Old
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More Green = More More Green = More $Green$$Green$
$29
$98
$116$129 $133
Average Buy 1 Buy 2 Buy 3 Buy 4
# of Items in Basket
Average Basket Size is 3x larger when GREEN is in the
basket
Source: Catalina PACES, 12 Weeks Ending 7/29/07
Opportunity exists to expand customer penetration
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WA
OR
CA
NV
ID
MT
WY
UTCO
AZNM
TX LA
MS ALGA
FL
SC
NC
ND
SD
NE
KS
MN
IA
WI
IL IN
MI
OH
KY
TN
WVVA
PA
NY
VTNH
ME
MA
NJ
CT
MD
NorthwestIndex = 183.0
7.8%
NorthwestIndex = 183.0
7.8%
PacificIndex = 90.7
3.9%
PacificIndex = 90.7
3.9%
MountainIndex = 123.9
5.3%
MountainIndex = 123.9
5.3%
SouthwestIndex = 58.3
2.5%
SouthwestIndex = 58.3
2.5%
CentralIndex = 61.9
2.6%
CentralIndex = 61.9
2.6%
North CentralIndex = 63.9
2.7%
North CentralIndex = 63.9
2.7%
SoutheastIndex = 35.7
1.5%
SoutheastIndex = 35.7
1.5%
CarolinasIndex = 70.2
3.0%
CarolinasIndex = 70.2
3.0%
NortheastIndex = 135.5
5.8%
NortheastIndex = 135.5
5.8%
Mid-AtlanticIndex = 129.6
5.5%
Mid-AtlanticIndex = 129.6
5.5%
Customer Penetration is Less than Customer Penetration is Less than 5%5%Northwest, Mountain, Mid-Atlantic and
Northeast are High Green Regions
Source: Catalina CheckOut Direct, 52 Weeks Ending 7/29/07
AR
MO
OK
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And And …… Most Consumers are Still in Most Consumers are Still in ““TrialTrial”” ModeMode
Consumers most likely to buy green cleaning products …
Are less likely to use to stronger brands …
… but may switch with other perceived friendlier brands.
Brand Switching is Prevalent Between Green and Mainstream Brands
Brand Switching is Prevalent Between Green and Mainstream Brands
Source: Catalina CheckOut Direct, 52 Weeks Ending 7/29/07
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Green Consumers Also Heavy Buyers of OrganicsGreen Consumers Also Heavy Buyers of Organics
1. Horizon Organic Cheese
2. Cascadian Farm Frozen Vegetables
3. Horizon Organic Butter
4. Applegate Farms Refrigerated Meats
5. Newmans Own Organic Cookies
6. Muir Glen Canned Tomatoes
7. Cascadian Farm Cereal
8. Organic Valley Milk
9. Annies Macaroni & Cheese Mix
10.Horizon Organic Milk
11.O-Cello Sponges
12.Amys Soups
13.Horizon Organic Yogurt
14.Vans Frozen Waffles
Source: Catalina CheckOut Direct, 52 Weeks Ending 5/20/07
TOP SELLING ITEMS IN BASKET WITH GREEN PRODUCT PURCHASE
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Not All Organic Consumers Buy Green ProductsNot All Organic Consumers Buy Green Products
Organic Food Only89.5%
Green Products Only0.3%
Buy Both Green & Organic10.2%
Over 31 Million Unique Shopper IDs Had Purchased at Least One Green or Organic Item
Over 31 Million Unique Shopper IDs Had Purchased at Least One Green or Organic Item
Source: Catalina CheckOut Direct, 52 Weeks Ending 7/29/07
90% of Organic Consumers Have Not Purchased a Green Brand During the Past 52 Weeks
90% of Organic Consumers Have Not Purchased a Green Brand During the Past 52 Weeks
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WA
OR
CA
NV
ID
MT
WY
UTCO
AZNM
TX LA
MS ALGA
FL
SC
NC
ND
SD
NE
KS
MN
IA
WI
IL IN
MI
OH
KY
TN
WVVA
PA
NY
VTNH
ME
MA
NJ
CT
MD
Northwest14.4% Buy Both
Northwest14.4% Buy Both
Pacific7.5% Buy Both
Pacific7.5% Buy Both
Mountain12.2% Buy Both
Mountain12.2% Buy Both
Southwest6.8% Buy BothSouthwest
6.8% Buy Both
Central7.5% Buy Both
Central7.5% Buy Both
North Central7.7% Buy BothNorth Central
7.7% Buy Both
Southeast6.4% Buy Both
Southeast6.4% Buy Both
Carolinas10.4% Buy Both
Carolinas10.4% Buy Both
Northeast11.6% Buy Both
Northeast11.6% Buy Both
Mid-Atlantic10.4% Buy BothMid-Atlantic
10.4% Buy Both
Source: Catalina CheckOut Direct, 52 Weeks Ending 7/29/07
10% of Consumers Purchase Both Organic and 10% of Consumers Purchase Both Organic and Green BrandsGreen Brands
Northwest, Mountain, and Northeast Regions Index Substantially Higher Than U.S. Average
AR
MO
OK
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Demographic Profile of Organic and Green Demographic Profile of Organic and Green ConsumersConsumers
Buys Green Brands and Organic FoodsBuys Green Brands and Organic FoodsBuys Organic Food OnlyBuys Organic Food Only
Key Demographic Traits
HH Size: 3+ Persons3+ Persons
HH Age: 3535--6464
HH Income: $75,000 +$75,000 +
Average % of Sales Spent on Green/Organic: 9.1% of Total Basket $9.1% of Total Basket $
Key Demographic Traits
HH Size: 2 Person2 Person
HH Age: 4545--6464
HH Income: $100,000 +$100,000 +
Average % of Sales Spent on Organic: 8.0% of Total Basket $8.0% of Total Basket $
Sample size: 7.8 million households52 Weeks Ending 6/30/07Static of 2 Shopping Trips in 13 Weeks
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Loyalty Profile of Organic and Green ConsumersLoyalty Profile of Organic and Green ConsumersBuys Green and
OrganicBuys Green and
OrganicBuys Organic
OnlyBuys Organic
OnlyAverage
CustomerAverage
Customer
Annual Consumer ValueAverage Order SizeAverage # of Annual TripsAverage Loyalty Rating
$1,420$44.04
32.033.2
$2,142$48.71
44.245.6
$3,641$59.76
61.058.9
• Green/organic consumers spend 23% more per order than an ‘organic only’ consumer
• Total consumer value of a Green/Organic customer is 2.5x more than the average shopper
• Green/organic consumers spend 23% more per order than an ‘organic only’ consumer
• Total consumer value of a Green/Organic customer is 2.5x more than the average shopper
Sample size: 7.8 million households; 52 Weeks Ending 6/30/07Loyalty Rating calculation: Chain $ as % of estimated TGEStatic of 2 Shopping Trips in 13 Weeks
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Determining Shades of GreenDetermining Shades of Green
The number of categories purchased by each group is equalSegment differentiation based on dollars spent on green products
Light
Minimal spending in green brands
Household products are ‘entry’ into green
Age: 65+
Income: Over $75,000
Medium
Minimal spending in green brands
Household cleaning is leading category
Age: 55+
Income: Over $100,000
Heavy
Spend 7x more than light spenders; 3x more than medium spenders
Oral hygiene products are of high importance
Age: 45+
Income: Over $125,000
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Opportunity to Educate ConsumersOpportunity to Educate Consumers
Target your brand message to the right audience who cares.
Increase brand loyalty by sharing a common cause with your consumer.
Reach high potential or future Green consumers to share your message.
“Smart companies tell the stories of their environmental goals, successes, and lessons learned to nearly anyone who will listen.”
Green to Gold by Daniel C. Esty and Andrew S. Winston
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Educating Consumers Educating Consumers How They Can HelpHow They Can Help
Print samples for example only
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Educating Consumers Educating Consumers National Brand CampaignNational Brand Campaign
Let them know what you stand for
Increase their involvement with the brand by inviting them to participate
Let them know what you are doing about the problem
Wee
k 1
Wee
k 2
Wee
k 3
Print samples for example only
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Executive SummaryExecutive Summary
Average Basket Size is three times larger when Green products are in the basket. The more items purchased, the higher the average basket size.Green product sales are increasing – 60% increase in two years.Average of 4.3% of consumers have purchased Green products.
Highest indexing regions are Northwest, Northeast, Mid-Atlantic and Mountain.Lowest indexing regions are Southeast, Southwest, and Central.
Green buyers are also heavy consumers of organic food brands.Potential Green consumers are current organic food buyers.Green and organic shoppers are 59% loyal to their chain –nearly 2x more loyal than the average consumer.
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