10 TOP MESSAGES M&S

TOP 10 MESSAGES

GLOBAL USAGE & ATTITUDES ON FRUIT

OUR OBJECTIVE By understanding current habits and behaviors limiting intake, M&S can change the game to break through consumers’ perceptions to increase consumption of fruit and fresh foods.

AM FRESH LAUNCHED THE FIRST GLOBAL USAGE & ATTITUDE STUDY ACROSS A SELECT PANEL OF 6000 CONSUMERS WORLDWIDE WE HAVE A STRONG HERITAGE OF PROVIDING FRUIT CONSUMER AND SHOPPERS INSIGHTS. AND WE WANTED TO CONDUCT A COUNTRY DEEP DIVE TO UNLOCK OPPORTUNITIES TO DRIVE FRUIT CONSUMPTION, GAIN INCREMENTAL SALES, UNDERSTAND HOW AND WHERE BEST TO FOCUS MARKETING ACTIVITIES AND DRIVE OVERALL CATEGORY GROWTH OF FRESH GOODS. THE UK DEEP DIVE: 2000 UK SHOPPERS 385 FLAGGED M&S SHOPPERS FOR GRAPES AND EASY PEELERS SPECIFICALLY, ADDITIONAL IN-FIELD QUALITATIVE IN-STORE INTERVIEWS CONDUCTED IN OCTOBER 2019 AMONG 100 UK CONSUMERS IN 2O STORES FROM MAIN REAILERS.

This research would provide understanding of: Global Usage & Attitude THE PEOPLE

Shop-Alongs

THE CATEGORY How do they make their decisions in store?

Who is the buyer?

What do they buy, how, when, where

Reasons driving your customers

and why?

to buy fruit

Measuring usage, frequency, moments

How much time do they require to make a decision?

Buying patterns and habits

of consumption

How can Retailers enhance their Shopping experience?

Retailer visit motivations

Barriers to purchase some fruits Cannibalization among fruits Understanding the occasions that

THE BRAND What do they think of the brands in the category? Understanding the role of the brand Brand awareness and perception Brand choice drivers Barriers to buy brands

What influences these decisions?

How do they view the category and navigate through it?

Response to In-store promotions

prompt shopping and using a product in

Understanding main touchpoints influencing your customers’

a particular category

decision to purchase

Exploring product preference and understand key motivations to purchase Understanding product experience after the point of purchase How much fruit is thrown away

How much time do they spend in Fruit department?

Do they pick and place fruits before placing them in the shopping basket?

1. The main reason behind fruit consumption is for health purposes Consumers actively seek healthy options Health is the main reason for which people eat fruit

What does this mean in M&S

What’s the main reason you eat fresh fruit?

To be healthy

66 %

I really like it

30 %

To fuel me

3%

To avoid eating unhealthy snacks

Remind younger generations the healthy

12 %

impact, so let’s deep dive in many other ways

While sometimes shoppers chose fruit to avoid eating unhealthy snacks

attributes associated to fresh fruit.

But Health-related messaging alone has limited M&S can change the game to increase fruit consumption. Do the work for the consumers as have sincere desires and intentions to eat fruit.

SOURCE: AM FRESH GROUP GLOBAL U&A 2020

What does this mean in M&S

2. Heavy consumers are the ones who eat

Emphasizing the use of fruit for breakfast and

fruit as a snack & for breakfast and with a

snacking moments would be a lever to increase

healthy mindset.

fruit consumption.

17% Shoppers claimed eating only 1 portion of fruit a day

1%

Shoppers do not eat fruit

17 %

… eat 1 portions a day

32 %

…eat 2 portions a day

27 %

… eat 3 portions a day

22 %

Eat 4 or more portions a day = “Heavy consumers”

Note: These numbers show rational appeals; things people consciously think they should do or even want to do.

SOURCE: AM FRESH GROUP GLOBAL U&A 2020

3. Fresh fruit is a driver of store choice, driving traffic and preference 57% Shoppers stated fruit department is extremely important or quiet important as a driver of store choice for the main grocery shop % stating fruit section is “Extremely important“ or “Quiet important” <35

36-45

46-55

+56

73 % 66 % 59 % 49 % What does this mean in M&S Fruit departments should be at the core of M&S to Young Families

75 %

Mature Families

65 %

Sinks&Dinks

64 %

Empty Nesters

attract families to their door.

51 %

SOURCE: AM FRESH GROUP GLOBAL U&A 2020

4. Fruit category generates its fair share of impulse sales too.

There are 2 important Shoppers clusters and it’s important to meet their needs.

The way both groups buy is totally different: What does this mean in M&S Shoppers who always buy with an Occasion in mind

Shoppers who always decide in store what to buy, depending on what looks good

Maintaining displays and merchandising with the freshest, high quality fruit items to drive unplanned purchases

20 %

Shoppers

What influence them?

What?

Why?

33 %

Shoppers

Snacking is one of the main occasions

appearance, freshness

20% of them buy branded Fruit almost always

37% of them Buy branded fruit only from time to time

Healthy mindset

I like it

Make fruits more convenient to the consumer throughout the day with Displays featuring Ocassions or “Snacking” solutions, snack packs and single serve options, to tackle morning and evening snacks occasions.

What about having fruit as part of the “Meal Deal”?

SOURCE: AM FRESH GROUP GLOBAL U&A 2020

5. Grapes: Quality is the most important attribute for grapes, with colour of the berries as an important factor to define quality.

Short shelf life is a main barrier to buy grapes.

Quality is the most important attribute when buying grapes

+

50% +

Quality

Quality

Colour

Colour

Variety (Cotton Candy…)

30-49% Price Variety <30%

-

Quality is even more important for M&S Shoppers

Price (Cotton Candy…)

Promotions Country of Origin Packaging If Organic

Price ranks much lower for M&S shoppers

Country of Origin Promotions

What does this mean in M&S It’s critical to clearly communicate Quality via: - Outer appearance of grapes: colour of berries and firmness.

- Firmness and colour for Easy peelers

Packaging

Extended shelf life and visibility in store could attract more frequent

If Organic

Specialty plays a key role among M&S Grape Shoppers.

Source: on line survey to 2000 UK Fruit Shoppers – Feb’20. N= 1861 Grapes Shoppers. Top 2 Boxes. M&S Main + Occasional Shoppers N=367

purchases

SOURCE: AM FRESH GROUP GLOBAL U&A 2020

5. Easy peelers: Quality is the most important attribute for Easy peelers, with Firmness and colour as important factors to define Quality Colour and size rank higher for M&S Shoppers Sweetness and Easy to peel are much more valued by Shoppers than seedless

Quality is the most important attribute when buying grapes

+

Quality

Quality

Price Size 30 -49% Colour

Price Size Colour

50% +

<30%

-

Colour and Size rank higher than price for M&S Shoppers

Promotions

Packaging

Packaging

Country of Origin

Country of Origin

If Organic

If Organic

Promotions

Source: on line survey to 2000 UK Fruit Shoppers â&#x20AC;&#x201C; Febâ&#x20AC;&#x2122;20. N= 1684 Easy peelers Shoppers. Top 2 Boxes. M&S Main + Occasional Shoppers N=350

SOURCE: AM FRESH GROUP GLOBAL U&A 2020

What does this mean in M&S

6. Established brands leverage an image of quality and trust with consumers.

Branded Fresh Fruit plays its role attracting Families and young generations to Retailers door, looking for quality guarantee and consistency, and resulting in bigger tickets, not just for fruit department, as they do main grocery shop too.

Branded fresh fruit plays its role attracting Shoppers to retailers doors.

Families with children, younger generations and Heavy Fruit Shoppers buy branded with higher frequency than other profiles

By presence of children

By # fruit consumed per day

By main shop

By age

Only 46%

60% Shoppers (up

60% Families with

62% Heavyยน fresh

Shoppers buying

to 35 yo) buy

children buy

fruit consumers

at Discounters

branded fruit vs

branded fruit vs

buy branded fruit

buy branded

50% older than

50% no families

vs 49% Light

product vs 56%

55+

Consumers

buying at Big4

Notes:ยน Buying 4 or more fruit type per trip SOURCE: AM FRESH GROUP GLOBAL U&A 2020

Watch out! COVID effect and its influence on Shopper behaviour patterns

7. Loose fruit is not working driven by several factors.

1 every 4 Shoppers never wash the fruit they buy This is one of the main barriers for people to buy loose fruit, but not the only one¹:

“Other people have touched it” “There is no difference in size and quality vs packed fruit”. “It it would be bigger size than packed fruit I would buy loose” “Shelf price seems more expensive”

(Loose is priced by Kg while packed fruit is priced by 600g or 400gr pack). It’s quite difficult for people to compare prices

What does this mean in M&S Loose fruit is not working for a “weekly shop”, but will work for targeting specific moments as Meal Deal, for food for tonight and small shopping occasions, on the go and convenience.

But let’s explore options to avoid the effects of COVID on Shoppers behaviors

Source: ¹ Verbatims from Shop-along conducted in UK retailers (N=100) – October 2019 SOURCE: AM FRESH GROUP GLOBAL U&A 2020

What does this mean in M&S

8. The Fruit category is relevant in multiple occasions throughout the day; and an

Let’s do the work for Consumers: let’s leverage these Occasions throughout the right packaging, pack size, visibility…

Morning and evening snack occasions provide a

important snacking alternative for kids

great opportunity to drive fruit purchase

Fruit is highly relevant across meal occasions % Shoppers eating fruit in main meals weekly

Breakfast

51 %

Morning Snack

47 %

Lunchtime

61 %

Evening Snack

44 %

45 %

After dinner Snack

34 %

Dinner

What about including Fresh Fruit as part of the Meal Deal and Snacks?

SOURCE: AM FRESH GROUP GLOBAL U&A 2020

What does this mean in M&S

9. More than 50% consumers eat fruit mixed with other products, including yogurt and cereals

Cross-merchandising activations and dual or multiple placements in- store, could be appealing and increase the impulse purchase for new moments of consumption Yogurt and Cereals offer the best opportunity to prompt

Cross-merchandising activations could be

unplanned and impulse purchases among category buyers.

appealing and increase the impulse purchase for new moments of consumption Heavy

Consumers

Total UK

64 %

71%

Yogurt, Cereals, Cream

Yogurt, Cereals

Salads is an option to explore in UK as itâ&#x20AC;&#x2122;s popular in other countries

Notes:š Buying 4 or more fruit type per trip

SOURCE: AM FRESH GROUP GLOBAL U&A 2020

What does this mean in M&S Let’s deep dive into more appealing promotions

10. M&S remains the gold standard for quality among its Shoppers.

But it ranks lower for Displays and promotions for Fruit, Shelf signage and ease of in-store navigation among its Shoppers

Source: on line survey to 2000 UK Fruit Shoppers – Feb’20. N= all who shop at this banner

SOURCE: AM FRESH GROUP GLOBAL U&A 2020

M&S remains the gold standard for quality among

M&S shoppers think Tesco is better in terms of

its Shoppers, even most of them are Occasional

promotions

Thinking about the Fruit category, which retailers you think are

Thinking about the Fruit category, which retailers you think are

the 2 best for Quality?

the 2 best for Displays and Promotions?

M&S Shoppers

All Shoppers

M&S Shoppers

All Shoppers

56%

21%

41%

45%

38%

46%

39%

12%

28%

24%

20%

25%

18%

10%

17%

20%

10%

17%

M&S rank lower for

33%

29%

23%

15%

16%

18%

15%

22%

Displays and promotions for Fruit, Shelf signage and easy to find the product

18% Source: on line10% survey to 2000 UK Fruit Shoppers – Feb’20. N= all who shop at this banner Sustainable options tracked: plastic free, recyclable solutions, loose product...

Source: on line survey to 2000 UK Fruit Shoppers – Feb’20. M&S Shoppers = 385

SOURCE: AM FRESH GROUP GLOBAL U&A 2020

A new horizon of FRESH foods

GLOBAL U&A PANEL: 6000 SHOPPERS WORLDWIDE / UK U&A PANEL: 2000 UK SHOPPERS