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INDUSTRY INSIGHT A NEW MINDSET FOR GROCERY: ‘FOODVENIENCE’ Food and drink bought to consume within one hour of purchase is worth more than double the value of online grocery. This is the ‘foodvenience’ market, expected to reach $10 billion in value in Australia this year. By Shopper Intelligence Client Service Director Caroline Burgess. Online grocery grew by a massive 40 per cent in 2020, but overall shoppers are still spending more fulfilling an immediate consumption need across grocery stores, home delivery, P&C, fast food and cafes. Our research demonstrates a particular need for grocery retailers and brands to keep up with shoppers’ increasing demands, as supermarkets are losing the biggest share of the foodvenience market to home delivery, which is worth $2.5 billion and growing. Satisfying today’s shopper Considering the tougher challenges retailers and brands are now facing, the new ‘Foodvenience’ report from Shopper Intelligence sets out what shoppers want, how they perceive retailers in the market compared with their competitors, and where retailers and brands need to invest to win shopper spend. Two in three foodvenience shopping missions are focused on food, most are pre-planned, and the most likely occasion they’re buying for is lunch. So, a simple win could be to focus on pre-store marketing to the lunchtime occasion. But different retailers, categories, locations and demographics reveal different results. Winners in foodvenience in 2020 The results from Shopper Intelligence research show some clear winners and losers in specific areas. For example, KFC and Hungry Jack’s are winning on lunch, while IGA and Woolworths are winning on snacking. We know from interviews with 600 QSR shoppers that their favourite food comes from Hungry Jack’s, but McDonald’s often wins spend because of the restaurant location. The obvious takeaway for Hungry Jack’s is that more locations would be a big win for them. Franchised cafes are all about the beverage-only mission. But when shoppers also want food, independent cafes are clear winners. This demonstrates shoppers’ preference for home cooked, Aussie made, or more ‘artisanal’ food products that indie cafes provide. Consider these questions: • Last year, 7-Eleven sold more coffee than McDonald’s, but what’s happened in the coffee battle this year? • Each of the supermarkets and convenience banners own different occasions within foodvenience, but has 7-Eleven held onto the breakfast occasion? • Caltex and BP lead on snacking in the convenience channel, but what pre- and in-store investments have won the snacking occasion for shoppers in these stores? The answers come from asking shoppers why they make buying decisions. Home delivery is owning the dinner occasion! The home delivery channel is fractured as it matures, and this is likely to continue due to Covid. Many food delivery providers are prominent in the channel, not just the main players: Menulog, You Foods, Hello Fresh and Uber Eats. What we know is that range and quality of service are the two most important factors in the home delivery channel. This differs from the total foodvenience market, where location and value for money dominate shopper needs. Make your shopper strategy data driven With this abundance of new information on foodvenience, it’s important for brands and retailers to understand exactly what it means for them, and what their next steps should be. About Caroline Burgess Caroline’s experience spans client management, business development and category planning. She understands retailers, having worked at Walmart, Tesco and Nielsen, where she ran the Coles account, before joining Shopper Intelligence. Caroline believes that only by understanding what shoppers want and need, can retailers and suppliers build joint winning plans for the future. About Shopper Intelligence Shopper Intelligence is the only partner to unlock how and why shoppers buy, then continuously and objectively benchmark every category and every retailer. With a combination of trusted expertise and pioneering techniques, Shopper Intelligence provides the most simple and actionable shopper insights in the industry. For more information, contact info@shopperintelligence.com.au. 14 CONVENIENCE WORLD MAR/APR, 2021