9 421902 251016
JULY 2011 Volume 17 No 6 $9.15
THE BUSINESS OF MANUFACTURING • LOGISTICS • SUPERMARKETING
fmcg . co . n z
foo d ne w s . co . n z
Introducing the next generation in toilet tissue. Luxury without Compromise
CEOS KNOW GLASS IS A GREAT DINNER GUEST. “S. Pellegrino® is the perfect companion to fine foods,” says Stefano Agostini, Chairman and CEO of Sanpellegrino S.p.A. “And glass is a perfect packaging for our brand. Our mineral water is sophisticated, the bottle is elegant—together, we add sparkle to the meal.”
Jul u y 1052 ul 25.1.1. .1 22
makers of charming, tasteful, food-loving glass packaging
ÂŠ Owens-Illinois, Inc.
Features 14 Mushroom Magic
6 Editor’s note 8 Industry news 15 Subscription form
j uly 2 0 1 1
Meadow Mushrooms’ founder Philip Burdon talks to Reg Birchfield
24 Benefits you can ‘feel’
Plant & Food Research on functional foods
28 Allergy friendly foods
Review of the Auckland Gluten Free Food & Allergy Show
18 Vitamins, Nutrition, Supplements 36 Biscuits & Baked Goods 44 Laundry
Regulars 12 Fresh and local In season
16 FGC The truth about food prices
17 Nargon Assessing the ‘Zero Budget’
27 FMCG online 35 GS1 On urban myths
OUR COVER Cottonsoft has launched the range of PASEO facial, paper towel and toilet tissue, which merges premium quality look and feel, with a genuine concern for the environment.
41 Whatâ€™s hot 64 Snap Spotted out and about
j uly 2 0 1 1
Your guide to upcoming industry events
Grocery business Keeping you up to date with packaging, IT, supply chain and logistics
47 Grocery business industry news 48 Is your business safe? 51 New age marketing
Convenience store and oil channel updates
Sweet fix â€“ new chocolate trends
57 C-store industry news 58 Nargon
Creating jobs for young people
59 Directory 54
Wine maven Bill Spence talks to Keith Stewart
62 BWS industry news
/RRQH\7XQHV6SULQJ:DWHULVGHVLJQHG WRPDNHGULQNLQJZDWHUIXQIRUNLGV 5A7>*VKL
L0400121 L0400241 L0400244 L1500121 L1500084
Looney Tunes Spring Water 400ml Looney Tunes Spring Water 400ml Looney Tunes Spring Water 4 x 400ml Multi Pack Looney Tunes Spring Water 1.5L Looney Tunes Spring Water 4 x 1.5L Multi Pack
9421902263187 9421902263187 9421902263200 9421902263224 9421902263248
09421902263194 09421902263262 09421902263217 09421902263231 09421902263255
12 24 6 12 2
Ô3XUH1=6SULQJ:DWHU%RWWOHGDWVRXUFH Ô7KH/RRQH\7XQHV6KRZFXUUHQWO\ VFUHHQVRQ79LQ1= ÔÌ/RRQH\7XQHV&ODVVURRP&DSHUVÍOLYH VKRZVSOD\LQJDWYHQXHVWKURXJKRXW $XVWUDOLDDQG1=IURP6HSWHPEHU DQGWKURXJKRXW
)RUPRUHLQIRUPDWLRQ FRQWDFW\RXUORFDO &URVVPDUN5HSUHVHQWDWLYH
e ditor ’s note Vol 17
Serving the business of manufacturing, logistics and supermarketing
tamara rubanowski – editor firstname.lastname@example.org
Juleigh buchan – account manager Ph: 09-529 3000, Mob: 021 140 3456 email@example.com
peter corcoran – account manager Mob: 021 272 7227 firstname.lastname@example.org
Production Manager Fran Marshall (09-832 0024) email@example.com
Design Cherie Tagaloa
Subscriptions firstname.lastname@example.org 09-529 3000 $90.00 a year (incl GST) for 11 issues Australia $150.00 Rest of the world $190.00
Printing & Pre-press PMP Print
Publisher Used on a white background
Mediaweb Limited PO Box 5544 Wellesley Street, Auckland 1141 308 Great South Road Used on a black background Greenlane, Auckland 1051 Phone 09-529 3000, Fax 09-529 3001 www.mediaweb.co.nz The opinions and material published in FMCG are not necessarily those of the publisher except where specifically stated. © 2011 Mediaweb Limited.
Asking the hard questions Why is country of origin labelling such a hot potato? Are our food prices rising faster than inflation and wages, as some segments of the media have recently reported? And what on earth are you supposed to do, when you are caught up in an armed robbery? In this issue, the FMCG team asks some hard questions and debunks a few urban myths. We bring you updates from FGC, Nargon and GS1, review Auckland’s Gluten Free Food & Allergy Show and investigate the latest developments in produce, fish and meat supply. We also talk to wine industry expert Bill Spence and Meadow Mushrooms’ founder Philip Burdon. Burdon shares his remarkable story and his thoughts on best practice in management in a candid interview with Reg Birchfield. Many managers and business owners have never experienced an environment like the one we are operating in at the moment. How will they overcome the challenges that we are facing after a global recession
ISSN: 1175-8279 (Print), 1179-8718 (Online).
Tamara Rubanowski email@example.com Official b2b magazine for the Gluten Free Food & Allergy Shows.
and natural disasters such as the earthquakes in Canterbury? How can we reinvigorate businesses and help them identify strategies and opportunities for future growth? I am optimistic that the situation will soon improve – especially after seeing the amazing new developments and technological advances at Fressure Foods, at Countdown’s National Distribution Centre in Auckland and at Van Dyck Fine Foods in New Plymouth, this month. You will find more details on these new projects in this issue of FMCG. Have you recently invested in new technology or launched an exciting product? We would love to hear from you, so please remember to email me with your news, industry events and photos. And if you decide to subscribe to FMCG this month, you will also receive our newsletter foodnews delivered via email twice weekly, plus you will be in the draw to win a giftbox of the new Jacob’s Creek Reserve range of wines! Remember to visit fmcg.co.nz for our exclusive online features and industry updates and enjoy this issue.
Great new LOOK to create great new
There’s new look packaging for two of Hellers family favourites that will take your sausage and bacon sales to new heights! SAUSAGE BITES come ready to eat, hot or cold, in three delicious varieties; Spicy, Honey and Cheese. They’re perfect for entertaining, snacking or for kids’ parties, and come in handy 250gm packs. And HELLERS EVERYDAY BACON RANGE has also been repackaged with our great new look. You can be as sure as Hellers that families will love these
great products and their new stand-out packaging.
news Countdown unveils new Auckland National Distribution Centre
Progressive Enterprises MD Peter Smith and Auckland Mayor Len Brown.
Countdown officially opened its new Auckland National Distribution Centre (ANDC) at Wiri in June, with Auckland Mayor Len Brown cutting the ribbon on the 30,000 square metre facility. Located at 60 Kerrs Road, the ANDC is designed to complement Countdown’s existing Mangere distribution centre and will service 7500 product lines for Countdown stores in the North and South Islands. The distribution centre will also serve Progressive Enterprises’ SuperValue and FreshChoice franchise stores. The ANDC will manage the storage, allocation and transportation of slow moving stock, while the Mangere Distribution Centre, now renamed the Auckland Regional Distribution Centre, will distribute fast moving goods to upper and central North Island stores. Progressive Enterprises managing director Peter Smith said the ANDC would streamline distribution and further grow the company’s logistics network. “The Auckland Distribution Centre represents a significant investment for future growth of our business,” Smith said.
BNZ joins New World In a New Zealand banking first, Bank of New Zealand has launched a purpose-built concept store within another retailer. The BNZ Lunn Avenue is located inside the brand new New World Stonefields supermarket at 100 Lunn Avenue in Mt Wellington, Auckland. BNZ’s head of retail banking – Auckland, Jo Kelly says, “This pilot is an exciting development in the evolution of New Zealand retail banking. We’re making banking quicker, easier and more convenient for both BNZ and New World customers.” The new store features two automated machines with enhanced capabilities; a cash exchange machine that businesses can use to change money to specific denominations and an ATM for cash transactions, balances and making deposits.
FMCG july 2011
“The distribution centre functions as the engine room of our business. It will improve the operational effectiveness of our supply chain and serve the long-term needs of our customers, our suppliers and our business,” Smith said. The ANDC was rebuilt from an existing Progressive Enterprises site, which previously also housed Ingram Micro and Dick Smith warehouse facilities. The $45 million refurbishment and construction programme started in March 2010, and included a complete renovation of the internal warehouse, with the installation of approximately 120 kilometres of new racking systems, a relocation of truck entrances and docking areas, and upgrades to all existing utilities. Smith said the ANDC also features a number of environmental sustainability initiatives designed to reduce carbon emissions. “Motion sensor lighting technology, retention and reuse of stormwater and hot water pipe insulation will help us towards achieving our goal of a 40% reduction in our carbon footprint by 2015,” he said. l
The bank’s first customers were local residents Frank and Anne-Marie Koszegi who are being helped by assistant store manager Lio Ale and staff member Kimberley Powell.
BNZ Lunn Avenue offers virtually all of BNZ’s day-to-day banking services including opening new accounts, or applying for a home or personal loan. The store will be open extended hours with staff onsite from 8am to 8pm on weekdays and 8am to 6pm over the weekend. The ATM and cash exchange machines will be accessible whenever New World Stonefields is open. l
news New Generation Countdown opens in New Plymouth Countdown has unveiled its latest store in Spotswood featuring a focus on fresh food and green technology. The 3800 square metre store replaces Woolworths Westown and features approximately 28,000 product lines set out in a new format, customer-friendly shopping environment. Seventy-three staff transferred from Woolworths Westown to Countdown Spotswood, which will employ 136 staff in total. The new store includes expansive produce, deli, meat and seafood departments, as well as a full-service bakery producing fresh baked goods daily. The store also benefits from wider aisles, 165 customer carparks and a Lotto outlet onsite. Store manager Nigel Harman said customers will be impressed with the supermarket. “It’s fantastic for the Spotswood community and our team has been working extremely hard to get ready for the grand opening – the store looks immaculate. “With a larger format new generation Countdown store, we’re able to offer customers a greater range of products. “Our store has wide aisles and an open layout to make it easier for shoppers to get around. With eight checkouts and four express lanes, our customers will also be able to get in and out quickly,” Harman said. The store also features a range of environmental initiatives
including a CO2 refrigeration plant system that will give significant energy efficiency benefits. Night blinds on refrigerated cabinets, sliding covers on freezers, heat reclaim off the refrigeration coils, energy efficient lighting and the use of natural light in roof panels will also help minimise the store’s carbon footprint. Chief operating officer Dave Chambers said the store is part of Progressive Enterprises’ $1 billion commitment made in 2009 to further develop Countdown’s store network nationwide. “We’re delighted to bring this store to Spotswood. Our newest store captures the innovation, environmental initiatives and the service which are hallmarks of the new generation Countdown,” Chambers said. l
PASEO – Luxury without Compromise PASEO Luxury Toilet Tissue With the PASEO velvety finish, lightly scented core, generously thick 3 Ply tissue and subtle quilting for extra softness, PASEO retailers can feel secure in the knowledge that they are offering their customers quality, environmentally sensitive toilet paper.
Forget sacrificing softness for the environment, Pure Luxury, Pure Softness, Pure Fibres. The PASEO difference lies in the renewable and certified fibres which are short and fine for ultimate softness, 3 ply sensuality and luxury, backed with PEFC certification. Cottonsoft, the market leader* in the toilet paper category has launched the range of PASEO facial, paper towel and toilet tissue which merges premium quality, look and feel, with a genuine concern for the environment. Partner with Cottonsoft to take advantage of a $1.5m campaign including television, mall, online, instore sampling to support 10the FMCG july 2011 launch, and grow the profitable premium tissue category.
PASEO Luxury Soft Facial Tissues The new collection of PASEO facial tissues is quintessentially luxurious, with the velvety softness of 3 plies, and features Shea Butter – an additive in leading moisture treatments – incorporated into the tissue to care for the delicate skin around the nose. PASEO X-Wipes Super Strength Paper Towels PASEO X-Wipes feature the latest in Wet Lock technology to absorb the messiest spills. With Super Absorbency, PASEO X-Wipes are bound to be a winner with Household shoppers across New Zealand. *source AZTEC TT volume, all periods to 12/6/11. PEFC certified. This tissue product is made from sustainably managed forests and controlled resources.
n ews Get involved in Rugby world cup 2011! Has your company considered joining the NZ 2011 Business Club to make connections with international business people by hosting them during the Rugby World Cup tournament? Adopting a ‘second team’ is an easy and enjoyable way for workplaces to get behind the Rugby World Cup this year, by welcoming visitors to New Zealand and supporting them while they’re here – and who knows what fantastic synergies you may find. Visit www.nz2011.govt.nz/get-involved for more information. You can also familiarise yourself with the REAL New Zealand Showcase. This programme of more than 200 sector events nationwide presents the best of New Zealand business and industry to the world during Rugby World Cup 2011. See www.realnzshowcase.com. If you want to display all the festival and showcase events on your own website(s), just contact firstname.lastname@example.org. The ‘NZ 2011 Office’ is the government-funded organisation responsible for maximising the opportunities that the rugby tournament in September and October offers New Zealand business. The NZ 2011 Business Club is part of that programme and connects international business people coming over for the
rugby with Kiwi hosts who have similar business interests. If you want to find out more about NZ 2011 and the Business Club, go to www.nz2011.govt.nz. l
july 2011 FMCG
FRESH & LOCAL Specialist resource writer John Clarke highlights developments in produce, fish and meat supply.
PRIME Green kiwifruit, persimmons, lemons, limes and mandarins. Yams, chokos, parsnips and carrots, main crop potatoes, excellent fennel bulb and celeriac and Brussels sprouts. Kahawai, piper, hoki, ling, blue cod and tuna. The Pacific oysters just get better and better.
SHOT TO BITS Feijoas after an indifferent season.
FISH Blue cod Now this really is a good time for this delectable white fish which has a lovely texture, delicate flavour and is very easy to handle. Not the cheapest fish in the sea, but worth the price every time. The further south it is sourced, the better. Blue Moki This is also in season and well priced at this time of year. Hake Quite lovely eating if treated gently. The short fresh season for this delicate fish starts this month. Hoki This is the season for fresh hoki – it is always well priced and people should try it fresh, not just frozenand-fried from the takeaway. Kahawai Still a good time for those big kahawai, and I stick by my guns – as good at least as any other fish in the sea. Ling The fresh season for ling runs until November. Ling is a surprisingly lovely fish to eat fresh, if not to look at. The frozen and smoked product is also available. Orange Roughy The fresh roughy season is not far off. Piper is most likely to be available over winter, but there are not a lot of fishers for this delectable little fish. Salmon, quinnat, chinook, or king – call it what you will, it is a great product and New Zealand farms more of this fish than the rest of the world put together. Trevally Yes, again I am pushing this fantastic common fish. The main season is over and there is less in the market, but it is of better quality over winter and still well priced. This is fish that needs to be turned over quickly as it is not a long keeper. Warehou is a good southern species and this is available in winter and at a very good price.
MEAT Generally it is not good news on the red meat front in the short term. At least the beef price is looking better
from our sector’s point of view. The lamb export schedule slows, as the hot European summer increased local supplies and tight economic conditions start to influence demand. But in local saleyards, the demand just continues to grow with store lambs breaking records in both islands. Prime lamb numbers are dropping, and so, of course, prices are firming up with lambs averaging $150 per head at many sales. The trend is rising and at 689c/kg average this is 188c/kg ahead of last year. Mutton prices continue to be high and still at record levels. In the south, many ‘in lamb’ ewes are selling for up to $200 in the saleyards. Beef Well it had to happen. Cattle export schedules have fallen somewhat under the influence of the strong New Zealand currency. The global beef markets also continue to soften as high prices affect consumer demand. But the prices – though down a little on last month – are still strong. Local trade prices for beef are 40-70c/kg ahead of last year, but the trend is falling. Venison schedules are steady, but are predicted to rise to levels way above last year in the spring peak period. So buy now while you can.
FRUIT Apples The New Zealand seasonal apples are still available and still good quality so we will not need to put imported rubbish on the shelves just yet. Avocados Watch the quality until the new season’s fruit come onto the market.
Chestnuts are in season but dropping off and hazelnuts are starting. If people see them with your produce they will likely buy them. Citrus New Zealand lemons are back, thank goodness! New Zealand mandarins are well in. Early New Zealand oranges will start to show up shortly, as will limes. Feijoas The season is about finished and it appeared to be a very average one. Kiwis Now is the time to push kiwifruit as the main crop is in and prices are remarkably good. Imported longans and lychees are available at this time of year for that something a wee bit different. Sometimes considered the poorer cousin of the illustrious lychee, the longan is very popular in other countries and is a very fine fruit. Pears There will be a New Zealand pear or two about, but they are deteriorating from now on. The nashi pear will hold on a little longer. Persimmons This is another good early winter fruit. Finishing soon, but it will hang around for a month or two. Tamarillos are available for those who can get a mortgage.
VEGETABLES Now is the time for root vegetables. Yams are definitely a good option at this time of year as are carrots, parsnips, swedes, the turnips including Kohlrabi, celeriac, and main crop and Maori potatoes. Fennel bulb, onions, and of course leeks are all in the best condition at this time of year. In fact this is the time to buy in all the roots, bulbs and stems that grow on or under the ground. These winter vegetables are all at their very best and very good buying. Nowadays this also includes the Jerusalem artichoke. More and more customers are catching on to this wonderful root vegetable due in
NEED MARKET ACCESS?
part to the fact that more people are being exposed to it in restaurants. Brussels sprouts are at their best and the cost is coming back. Capsicum and aubergines are mostly imports at this time of year. There will be a few New Zealand hot house options around but they will be expensive. Celery is a very good buy at present and the quality is also very good. Chokos are slowing, but they keep well so you will still be able to get them until mid-August or so. Garlic grown in New Zealand is getting scarce, but plenty of the cheaper Chinese garlic about (I say it’s rubbish). The imported American stuff is much better quality, but you have to pay for it. Leeks are definitely a good option at this time of year and plentiful again. Shallots are hard to find and will become harder.
WE OFFER: WE OFFER: LEAF – Linking New Zealand GAP New Zealand GAP LEAF – Linking Environment And GLOBALG.A.P Environment And Farming GLOBAL.G.A.P Farming British Retail Residue Testing British Retail Consortium (BRC) Residue Testing Consortium (BRC) Phytosanitary Tesco Nurture Survey, Inspection, Phytosanitary Scheme Tesco Nurture Audit and Certificate Survey, Scheme Quality Woolworths Verification Audit Inspection, Assurance Woolworths and Certificate CropSure Residue Quality Assurance Verification Coles Supplier Assurance Management Programme Coles Supplier CropSure Residue Programme Management Food Safety Assurance Cert TM Programme carboNZero Programme Programme carboNZero Cert TM Organics Organics
Food Safety Programme
Please contact us to purchase a copy of the revised BRC Global Standard for Food Safety – Issue 6, due out in July. Discounted rates apply.
Please contact us to purchase a copy of the revised BRC Global Standard for Food Safety – Issue 6, due out in July. www.asurequality.com Discounted rates apply. Freephone 0508 00 11 22 ®
www.asurequality.com Freephone 0508 00 11 22
Mushroom magic Reg Birchfield talks to Meadow Mushrooms’ Philip Burdon about management and best practice.
hilip Ralph Burdon can, at a healthylooking 72, boast a full and extraordinarily successful business and public service life. He has accumulated a personal fortune of $70 million, according to last year’s National Business Review rich list. He is, along with his long-time business partner Roger Giles, the co-founder and now chairman of Christchurch-based Meadow Mushrooms. The company is the most sophisticated mushroom farm in the world and with an annual turnover of around $50 million it is one of New Zealand’s largest single agribusinesses, says Burdon. Meadow’s mushroom business is growing rapidly. It opened a new $45 million plant expansion on the outskirts of Christchurch in March. The buildings cover almost three rugby pitches from which the company now harvests 160 tonnes of mushrooms a week and employs 500 Cantabrians to do so. It is an environmentally and commercially sustainable business that seems to fit the ‘100% pure’ New Zealand enterprise profile. Burdon is, at heart, an entrepreneur. He has, however, successfully made the transition to professional manager and then on to hands-off director. Along the way he completed a successful secondary career with 15 years in politics. Burdon and Giles established their first mushroom business – Mattamore Mushrooms – in the caves of the Cyprus countryside in
FMCG july 2011
1968. Christchurch-born Burdon convinced his partner they should also set up shop in New Zealand, which they did, and so Meadow Mushrooms was officially launched in January 1971. It was a good decision. In July 1974 the Turkish Army invaded Cyprus and the tiny Mediterranean island was torn apart by a savage civil war. Its Greek and Turkish communities were irreparably divided and Mattamore became collateral damage. It was a traumatic commercial and human experience that Burdon would not forget. Burdon may be wealthy and come from well-heeled English stock, but he is very much the political liberal. He served as a National Party politician through the 1980s and much of the 1990s. As Minister of Trade in the Bolger government of the early 1990s he was deeply involved in negotiating General Agreement on Trade and Tariff (GATT) reforms that ushered in a dramatic expansion of New Zealand’s international trade. His trip into politics was prompted by his infuriation with the conservative politics of National Prime Minister Robert Muldoon. He considered Muldoon’s infamous 1970 payroll tax the “stupidest thing” a private enterprise government could do. Rather than insults from the sideline however, Burdon joined the party and battled “unthinking” policies from inside. In addition to his chairmanship of Meadow, Burdon also chairs the Asia-New Zealand Foundation, a non-partisan and non-profit organisation “dedicated to building
New Zealanders’ understanding and knowledge of Asia” and is, among a number of other directorships, deputy chair of Singaporebased GuocoLeisure, formerly BIL International. He is still a party supporter but once again finds himself questioning the wisdom of National Government policies and practices. He heads a Christchurch earthquake recovery ginger group – The Future Canterbury Network – established to “prevent the city’s recovery from becoming mired in the bureaucracy” that characterised the post-September quake response. And he’s enlisted the support of an impressive gallery of Christchurch commercial and community leaders. What drives this enthusiastic and rather tireless business and community leader? And how has he managed his exit from the management of Meadow Mushrooms and strategised its commercial longevity? Burdon’s commercial success is, he says, based on his ability to delegate and choose the right people to work with. “Most entrepreneurs compromise their businesses as they move from innovation to consolidation, then stagnation. They never learn to delegate and give responsibility to management,” he says. “We have successfully moved from entrepreneurial to professional leadership.” The company has “endlessly engaged” in seeking out and implementing international best practice processes and focused on employing the best people to deliver those practices. “Roger and I were a unique [working] combination with
Q&A The company is the most sophisticated mushroom farm in the world and with an annual turnover of around $50 million it is one of New Zealand’s largest single agri-businesses. complementary abilities and a clear understanding of what we wanted to achieve. Entrepreneurs often get submerged in the business detail of their creations,” a trap, he says, he and Giles managed to avoid. Burdon looks for the “conventional qualities of leadership, discipline, expertise and the capacity to inspire respect” when he appoints a chief executive. “CEOs fail when their ego gets ahead of them or because they don’t listen and consult,” he adds. “Good CEOs have a succession plan and know how to delegate.”
Senior executives must be “self aware” to lead successfully, he says. “They destroy themselves and the business when they give way to personal arrogance or become obsessed with the business and micro-manage. It is critical not to be overcome by your own hubris.” Meadow Mushrooms is a “transparent organisation” that Burdon says has always been conscious of the need to take the founding families out of the management as it grew.“As a rule, a second generation business should avoid family executives. Being family
automatically carries the insinuation that a ‘first among equals’ rule applies. We have a corporate structure with a strong, independent board and all the appropriate disciplines and accountabilities that accompany being a large corporate,” he adds. Building a business on mushrooms has helped. Many entrepreneurial businesses are, says Burdon, constrained by the limitations of New Zealand’s small economy. “We operate in a sector that allowed us to grow and achieve sufficient scale to move to a corporate structure.”
& YES! Title: Mrs, Ms, Mr
I’d like to order an annual subscription to FMCG magazine (11 issues) for just $90.00 incl GST including the free twice-weekly foodnews email newsletter. Name:
I am paying by
SUBSCRIBE THIS MONTH TO BE IN THE DRAW TO WIN A GIFTBOX OF JACOB’S CREEK RESERVE WINES!
°ÊCheque (enclosed). Please make cheque payable to Mediaweb Limited
°ÊTick here if you require a tax invoice or receipt
Card No: Name as it appears on the card:
Type of business:
Used on a white background
SUBSCRIBE ONLINE Cheques payable to: Mediaweb Limited Post to: Subscriptions, Mediaweb Limited, FREEPOST 288, PO Box 5544, Wellesley Street, Auckland 1141 Used on a black background Email: email@example.com
www.fmcg.co.nz/subscribe (including international prices) From time to time we run subscriber-only offers related to other magazine titles we publish. If you do not wish to receive these, please tick.
All prices include GST GST No: 102-417-023 If you do not wish to receive offers from third parties, please tick.
You must be 18 years or over to be eligible for this prize. (Please tick) Drink Jacob’s Creek responsibly.
july 2011 FMCG
The truth about food prices Katherine Rich, CEO, NZ Food & Grocery Council. Email: Katherine.firstname.lastname@example.org
Are food prices rising faster than inflation and wages?
In New Zealand, there are regular media reports of sky-rocketing food prices. The issue has become highly political with opposition parties claiming “rising food costs are a kick in the guts for families” and that “food prices drive people into poverty”. It’s important to keep the debate in perspective. It is true that food prices are increasing. Of course, the cost of pretty much everything rises over time.The key issue is whether food prices are rising faster than inflation and wages. Looking back over the past 20 years, the Food Price Index has moved at virtually the same rate as the Consumer Price Index, which measures overall inflation. This confirms that, over two decades, the difference between the two indicators has been minimal. As a result, people are paying roughly the same for food in real terms as they did in 1990. There has been no blow-out. Over the same time period, wage growth has largely matched food price growth meaning that, for most consumers, their food purchasing power has remained roughly the same. That said, the current global recession has restrained wages in recent years and a small differential may be emerging. The bottom line is that food prices are going up, but not to the extent segments of the media and politics would suggest. One of the main reasons the food price hike story has entrenched is that some highprofile products have become more expensive. Over the past 10 years, the three products which have increased in price the most are mutton and lamb, cheese and milk products. The price of cheese in particular has caused a great deal of comment and consternation. Conversely, the three products which have increased the least in cost are breakfast cereal, fresh fruit and fresh vegetables. 16
FMCG july 2011
In many areas there has actually been price deflation. There are a number of supply and demand reasons why food prices are rising around the globe. In recent years, extreme floods and droughts have affected a number of commodities. Political decisions, such as Russia announcing a ban on all wheat exports, can drive up prices across the board. Even well-intentioned environmental policies can have an impact on costs. For example, widespread government subsidies for biofuel means grain which would have previously been sold as food is used instead to make fuel. This pushes the food price up. New Zealand, as a small market, is not immune to these global changes. Perhaps the most significant driver of food prices is growing incomes in developing countries, particularly China and India. As their economies have grown, standards of living have lifted and people’s lifestyles have changed. This includes a shift towards a Western diet with more meat, poultry, fish, eggs, dairy products, oil and sugar. While everyone understandably hates rising prices, there are two key issues New Zealand as a country needs to take into account when considering the price of food. Increased demand for food has pushed prices up. Much of that demand came from China and reflected its strong economic growth which has created a large middle class and higher incomes.That is important for New Zealand because it was the size and strength of the Chinese economy which essentially prevented the global recession turning into a global depression. The developing countries pushing food prices up are often buying products that New Zealand is actually very good at making.The strong international demand for our cheese, milk and dairy products is why those items have risen sharply in price. Similarly, lamb is expensive here because globally the price of meat has nearly doubled in a decade. When hundreds of millions of people begin eating a new food group, the price of that food will always rise. That can be tough news for Kiwi shoppers but it is good news for our farmers who remain the backbone of the New Zealand economy. Food prices are rising but not nearly as sharply as some would have you believe.
Assessing the ‘Zero Budget’ It’s a tough – but necessary – stance, says Trina Snow. Many years ago, the Budget was a major event on the New Zealand political calendar. Details were kept in strict secrecy and government ministers were notoriously tight-lipped about the contents. There is a credible story about an underground tunnel from the old Government Printers office directly into the Beehive basement so that printed copies of the Budget could not be hijacked on the short drive between the buildings. In modern times, the pendulum swung the other way. Today, the Government actively tries to dampen down Budget expectations and ministers will often pre-release a number of major policies. The twin intent here is to deliver more than people expected so voters are pleasantly surprised, and to spread the ‘good news’ over a month rather than a week. In the lead-up to the 2011 Budget, the Prime Minister and ministers were keen to stress it would be a tight and austere Budget. Finance Minister Bill English stated “this is not a typical election-year Budget.” There would be no big spending programmes to benefit large numbers of voters just before the election. Instead, English characterised this year’s document as “a responsible Budget appropriate to New Zealand’s situation”. That situation included a tight economy, a need to control government spending and the imperative to reduce debt and debt repayments. The theme of the Budget was “Building Our Future” and the three main goals were building faster economic growth around higher national savings, setting a credible path back to surplus and repaying debt, and rebuilding Christchurch over the next few years. Compared to the previous two Budgets, which contained tax cuts and significant employment law changes, there were not as many policies announced on 19 May which will directly impact stores.The focus was on a broader re-balancing and stabilisation of the New Zealand economy. However, there were several policies which will be of interest. As signalled, there were changes to KiwiSaver to increase individual and employer contributions and reduce the burden on the Government. From 1 April 2012, the tax-free status of employer contributions will be removed. These will then be taxed at an employee’s marginal tax rate. From 1 April 2013, compulsory employer contributions will also rise from 2% to 3%. As part of a broader youth employment package,
Trina Snow, executive director, NARGON.
the Government introduced Job Ops with Training. It is a refocused version of the old Job Ops programme which now incorporates training in the flexible $5000 subsidy for employers. This can be used for both wages and training and will cost $13 million in 2011/12. It may be of use to some stores. In a broader sense, the Budget forecasts 4% economic growth in 2012, 170,000 new jobs by 2015 and wages to grow faster than inflation.All of those would be beneficial to the economy and to our industry. Budget 2011 also predicts the Government accounts will return to surplus in 2014/15, a year earlier than forecast in Budget 2010.The public sector has been directed to save just under $1 billion over the next three years but this should not affect frontline services. It may even lead to a reduction in compliance and red tape. Stores affected by the devastating Christchurch earthquakes will welcome the ‘Rebuilding Canterbury’ programme. This includes a $5.5 billion Earthquake Recovery Fund over six years and the establishment of the Canterbury Earthquake Recovery Authority (CERA). This will receive $25 million over two years to support the rebuild and improve the welfare of residents. As expected, there was criticism of the Budget from opposition parties, unions and commentators. Labour’s finance spokesman David Cunliffe told NARGON that “National’s Budget fails to deliver” saying it “did nothing” to address the fundamental issues and instead “made a broad series of cuts that will hurt but not help”. After a long and, at times, heated debate, the Budget was passed 67 votes to 53 with National, ACT, the Maori Party and United Future voting in favour. NARGON would describe the Budget overall as tough but necessary in the circumstances.Voters appear to agree with the first post-Budget polls showing only a small drop in support for National after what was dubbed the “Zero Budget”.
july 2011 FMCG
cate go r y c h e c k
Supplements season As we head into winter, health-focused categories such as Vitamins and Nutrition are of great importance to retailers. FMCG looks at emerging trends in this category.
he Grocery Dietary Supplements market is worth $54.9 million and is showing promising signs of growth, says Suzanne McKandry, marketing manager – Healtheries Dietary Supplements. She explains: “Three key brands account for over 75% of the market – Healtheries, Red Seal and Blackmores. Healtheries, NZ’s most trusted dietary supplement brand for four years running, strongly leads the market with a 44.1% share (MAT, 5/6/11), growing well at +3.8% MAT vs YA. However, Red Seal ranked second and accounting for 17.8% of the market, is experiencing declines (-2.1% MAT vs YA). Blackmore’s positioned at number 3, accounts for 13.8% of the market.” She adds: “The category growth can be attributed to a wide range of elements. As natural health becomes more mainstream across total retail, 18
FMCG july 2011
vita mi ns, nutr i ti on, suppleme n ts
THE BREAKDOWN Current MAT to 22 May 2011
consumers are more aware, and with information to help educate consumers so widely available online, and the increased support ATL from brands within the Grocery category, in many segments consumers are happy to self diagnose and are comfortable to shop within the Grocery environment. This is combined with an increase of higher value, more condition specific and targeted new product launches in areas of Stress and Sleep support and now Digestive Health, which were traditionally more Pharmacy and Health Food store purchases.” In winter, the Cold and Flu segment of the category is of great importance to Grocery retailers. McKandry comments:“Cold and Flu Dietary Supplements is the number one segment, worth $10.2m, delivering strong growth (MAT vs YA, +9%). Vitamin C accounts for over
75% of total Cold and Flu Dietary Supplement sales, so is of great value to the Grocery channel. NZ Grocery sells more Vitamin C than any other channel in the NZ market, selling close to 685,000 units, more than three times that of the closest competitive channel. Healtheries leads the Cold and Flu market with a significant 80% share and is continuing to drive strong growth for the segment (+10% MAT vs YA).” Healtheries has recently launched two new products to its Vitamin C range, extending the patented form of Vitamin C products, ‘Ester C’. McKandry explains: “The launch of these products – Healtheries Ester C 500mg Lemon Lime Chewables and Healtheries KidsCare Ester C, is designed to help trade consumers up from standard Vitamin C. Ester C carries a price premium but the consumer benefits justify the price differential. Ester C is absorbed twice
Total Health Supplements: $74.244m Val % Chg vs YA 5.4 Total Vitamins: $30.212m Val % Chg vs YA 6.4 Total Nutritional Sports Bars: $7.163m Val % Chg vs YA 7.1 Total Nutritional Supplements: $13.340m Val % Chg vs YA 9.4 Total Fish Liver Oil: $6.468m Val % Chg vs YA 10.9 Total Other Health Tablets: $7.001m Val % Chg vs YA -0.6 Total Minerals: $4.138m Val % Chg vs YA 5.3 Total Herbal Supplements: $4.047m Val % Chg vs YA -7.0 Total Garlic Tablets & Capsules: $1.797m Val % Chg vs YA -6.6 Total Energy Supplements: $50,191 Val % Chg vs YA 77,116.5 Total Tonic Supplements: $26,224 Val % Chg vs YA -56.4 Total Homeopathy: $96 Val % Chg vs YA 99.8 * ACNielsen New Zealand ScanTrack (Databank)
as fast as standard Vitamin C and is retained in the body to provide you with 24-hour immune system support, unlike that of standard Vitamin C. For Grocery to continue to grow, retailers need to support good product initiatives like Healtheries Ester C, which can deliver increased value and step outside of selling ‘the biggest pack for the cheapest price’.” In recent times the Multivitamin segment (also known as General Health) has seen a lot of increased activity. McKandry says: “Worth $9.9 million, growing at 3% MAT vs YA, july 2011 FMCG
cate go r y c h e c k
Healtheries leads the segment with a 42.7% share, largely driven by the successful Men’s and Women’s range. Healtheries will be returning strongly to supporting its Multivitamin range, launching back ATL with its Women’s Multi TVC campaign in July. For the recent quarter, Healtheries has experienced +6.3% share vs YA, a great position to kick off the new support programme.” Healtheries has also recently launched new products with a focus on Vitamin D. Australians and New Zealanders are at risk of low Vitamin D levels. With increased awareness of skin problems due to excess sun exposure, Kiwis are now covering up and slopping on the sunscreen. Because our bodies rely on sunlight to create Vitamin D, this means some of us suffer from low Vitamin D levels, which can then lead to bone weakness. People who work indoors, have darker skin, or are growing older, are more likely to have low Vitamin D levels. McKandry explains: “In May, Healtheries launched Vitamin D 1000IU, taking a segment traditionally sold in ‘specialist’ channels such as Pharmacy and Grocery, into the mainstream. In the last year, Vitamin D has been highly topical in the media, and will continue to be so. Grocery needs to grab hold of these smaller niche products and they will reap the benefits.” She adds: “Healtheries has also launched a new High Potency Fish Oil 1500mg with Vitamin D, building upon their highly successful Fish Oil 1500mg launched in May last year, now ranked number 3 total Fish Oil. Healtheries leads the Fish Oil market now worth $5.8 million, growing at 14.6% growth MAT vs. LY. Healtheries has a 39.2% share growing + 21.3%% MAT vs.YA.” She explains: “For this segment to continue to deliver strong value growth, moving away from a strong 20
FMCG july 2011
price, promotionally driven philosophy is key.The Healtheries launch of their 1500mg Fish Oil and 1500mg + Vitamin D, supports this strategy. Consumers love fish oil, the health benefits are many: immunity support, eye, heart and joint health. Consumers are seeking higher potency and more co-factors and the convenience of buying it from Grocery versus a specialist channel is a major benefit to them.” McKandry adds: “Glucosamine rounds up the top four segments – at $4.8 million – and is holding flat in growth MAT vs YA. Healtheries has a 58% share, growing extremely well +9.1% vs YA. Healtheries strongly supports its Jointex range, with TVCs featuring consistently throughout the year and is seeing Jointex go from strength to strength (53% share 2010 – 58% share 2011). “Consumers trust the brand, but most of all, the products work and consumers can feel the difference. If they didn’t, they wouldn’t return and buy again,” says McKandry. One of the biggest opportunities for the Dietary Supplements Grocery market sits in a newly growing segment – Digestive Health. Stomach cramps, constipation, irritable bowel syndrome, bloating and gas can all be associated with poor digestive health. McKandry says: “Probiotics, widely associated with the Dairy cabinet in Grocery, have now launched into Grocery as a shelf-stable capsule option. In competitor channels, Probiotics deliver more than $5 million in sales. Healtheries has launched Probiotica P3, a clinically proven, shelf-stable and acid-resistant blend of three scientifically proven strains that not only supports digestive health, but also supports the immune system. Healtheries will support Probiotica ATL, launching its TVC on air during July.” All data sourced from Aztec.
vita mi ns, nutr i ti on, suppleme n ts
Bayer’s new launches Bayer supplies Berocca – the performance multivitamin; Redoxon – effervescent with 1000mg of vitamin C; and Elevit Women’s Multi. Bayer’s senior brand manager Mike Campbell explains: “In the last 12 months we have launched Berocca 45s – Orange & Original 45s. This is a bigger pack for daily users of Berocca. We have also launched Elevit Women’s Multis 60s and 100s. “Berocca 45s have performed better than expected and are delivering incremental sales to the total Berocca brand. Launched in September 2010, both skus combined now have a 9.2% share of the Multis+Bs segment (Aztec data to 24/04/11). The Berocca range now has a strong shelf presence and is a real beacon in the cluttered Multivitamins category,” says Campbell. Elevit Women’s Multis launched in mid March and the initial results look very positive. Campbell explains: “Elevit is the market leading pregnancy supplement in Pharmacy and this new launch leverages this strong brand in Grocery with a new multi formula specifically for women with children.” From July, look out for new Berocca Focus 50+, a Multivitamin with minerals and 250mg natural Ginseng to improve concentration, clarity and stamina throughout the day, every day. This is aimed at consumers 50-65 years of age who want to maintain the ability to perform well. Campbell explains: “Like most countries, we have an ageing population with more over 65s than under 15s projected by mid 2020s (source: Statistics New Zealand), so this is an area we see for real category growth. Our research shows 50+ consumers are higher frequency users of Multivitamins and purchase the largest percentage of sales.
They are seeking supplements to help mental sharpness and physical performance.” The product will be launched in both Effervescent and Film Coated tablet formats. “We expect the FC tablet to be the hero product as tablets have greater association with medicine and therefore a better fit with ‘everyday protection’ among the 50+ target,” says Campbell. The launch will be supported with PR, new POS and TV activity. “We’ll continue to see more innovation aimed at specific segments such as 50+, kids, and sleep,” predicts Campbell.
Blackmores In the past 12 months, Blackmores has launched Respra Syrup a natural-based chest tonic containing the research-based ivy leaf extract to support respiratory health and clear airways, with a sugar-free fruity flavour that even kids will have no trouble taking. Among other recent launches are: • Blackmores Digestive Bio Balance • Blackmores Odourless Fish Oil + Vitamin D3 • Blackmores CoQ10 75 mg. API Consumer Brands’ senior brand manager Rhonda Bennett told FMCG: “We have also just launched Blackmores CAL-D. A high dose Calcium & Vitamin D3 supplement in an easy to swallow tablet.” Both Calcium and Vitamin D are essential for maintaining healthy bone density. Many New Zealanders don’t consume the recommended dietary intake of Calcium and a significant number are at risk of low Vitamin D. Among the emerging trends in this category, Bennett sees new products that make it easier and more convenient for the consumer to take Vitamins and Supplements – including two-in-one formulas, one-a-day doses, high-strength formulas and
“Vitamin C accounts for over 75% of total Cold and Flu Dietary Supplement sales, so is of great value to the Grocery channel.” Suzanne McKandry, marketing manager – Healtheries Dietary Supplements easy-to-swallow tablets. “Blackmores has had 7.3% growth MAT, more than double the category growth of 3.2% (Aztec 29/05/11 TKA excl GST),” says Bennett.
Red Seal Red Seal national sales & marketing manager Sue Millinchip says the company has recently launched three new products: • Fish Oil 1500mg 125s, which is building share steadily (latest 4 wks to 22 May 0.7% vol share) • Glucosamine 1500mg 120s (latest 4 wks to 22 May 0.2% vol share) • Vitamin C 500mg & Echinacea 100s (latest 4 wks to 22 May 0.2% vol share). We are still building distribution, but dollar sales are going well so far, she says. The Red Seal R&D team are always working on new products. Millinchip comments: “An ongoing increase in self management of health has meant category growth this year (Value +4.2% MAT to May 22, 2011 and +9.4% for the latest quarter). The core segments of Fish Oil, Glucosamine, Multivitamins and Vitamin C are all performing relatively well but it is interesting to july 2011 FMCG
cate go r y c h e c k
see more niche products such as Red Seal Magnesium also in growth. This indicates consumers are researching their requirements and becoming more specific in their purchases.” In her view, the category has an older bias but younger people are also shopping for health, proactively ensuring they keep well rather than waiting to get sick and then seek treatments. Millinchip says: “Red Seal has a proven place in the market offering good value, good quality supplements New Zealanders know they can rely upon. Recent consumer research has confirmed a strong level of consumer loyalty which augurs well for this brand’s future. “Red Seal is one of the few NZ-
owned companies in this category, particularly in Grocery, something New Zealanders are taking more of an interest in supporting.” All data sourced from ACNielsen.
Nutrition supplements Horleys began in 1976 and continues to deliver superior NZ formulated and NZ made products that embody its ‘Intelligent Sports Nutrition’ positioning, says Horleys’ marketing manager Karen Smillie. “With a category leading share position of 43.7% of the $19.9 million Nutritional Supplements category* (excludes Vitamin, Minerals and Effervescents), the Horleys range is familiar to consumers who have a passion for working out, health and
fitness, organised sport and competitive events,” she explains. Smillie adds: “Innovation in product formats that more closely resemble ‘normal foods’ rather than traditional nutritional supplements has been crucial to continue to bring new users into the category. A recent example was the launch late last year of the Horleys Carb Less Deluxe bar range. These high-protein, low-sugar treats resemble a confectionery bar in taste and texture but are a smarter snack choice. Consumer feedback on these new bars has been consistently excellent.” Smillie says: “The highly successful Sculpt range is 11 years old and offers specifically tailored weight management nutrition with a gym pedigree that – thanks to its wide distribution in grocery – can be comfortably purchased by women of all ages. Retailers have also seen the up side in the form of excellent margins in this high value segment.” Horleys continues to invest in sponsorship across a multitude of sporting disciplines all over NZ in order to build product awareness and sales.The stalwart of the sports range, Replace, is proud to be the official sports drink of NZ’s premier long distance triathlon: Ironman NZ. * Value TKA MAT 17/4/11 Synovate Aztec
Low carb Atkins sales and operations manager Cam Bourke told FMCG: “Atkins is the No 2 brand in the Nutritional Supplements category and is growing at 102% (Nielsen 27/2/11).” The company is planning to launch Day Break Crunchy Muesli, Endulge Milk Chocolate Mint and Endulge Milk Chocolate Almond soon. “Low carb products seem to be trending upwards in terms of both sales, value and volume,” comments Bourke. 22
FMCG juLY 2011
Try our clever new online tool that will tell you the right supplements & foods - just for you! With so many options to choose from DWWKHVXSHUPDUNHWLWÂŞVRIWHQGLIÂąFXOW WRÂąQGWKHULJKWSURGXFW1RWDQ\PRUH ZLWKÂ§+HDOWKHULHVIRU\RXÂ¨GHYHORSHGZLWK DGYLFHIURPWKH+HDOWKHULHV 1XWULWLRQLVWV 1DWXURSDWKV -XVWSLFNRQHRIWKHWHQKHDOWKJRDOV from â€œMy immunityÂ¨, to â€œMy weightÂ¨or â€œMy stress & sleepÂ¨ Then answer a few questions, and \RXÂŞOOJHWSHUVRQDOLVHGSURGXFW UHFRPPHQGDWLRQVDORQJZLWKKHDOWK WLSVDQGGLVFRXQWYRXFKHUVWRKHOS \RXUHDFK\RXUSHUVRQDOKHDOWKJRDOV 7DNHWKHJXHVVZRUNRXWRIEHLQJKHDOWK\ WU\healtheriesforyou.co.nz today!
When youâ€™ve received your personalised recommendations, click on SAVE to join membership & go in the draw to win a weekly Healtheries Hamper worth $200. B1=
Benefits Are proven health claims enough … or do consumers want more? Karl Crawford of Plant & Food Research and co-author of ‘Successful Superfruit Strategies’ explains.
he functional foods marketplace is full of health claims, some proven others questionable, but are scientifically validated health claims still influencing consumers? Just look at the “superfruit” phenomenon. The “superfruit” label is commonplace within the functional foods market and remains a strong driver for consumers, however, new and established products utilising the superfruit concept will need to work hard to keep consumers engaged and maintain price premiums. The rising tide of new fruitderived functional consumer products and ingredients has slowed a little over the past few years. So has the level of hype in the marketplace about the potential for fruit to deliver “super” benefits to consumers. Established products are still selling well, but there are few truly new products entering the “superfruit” space. This slowdown in new superfruit launches is a natural result of the market outrunning the ability of 24
FMCG july 2011
you can ‘feel’ science to support new functional claims from fruit and fruit-derived ingredients. When the superfruit phenomenon launched at the start of the 21st century marketers had decades of science to draw on when suggesting functional benefits from various fruits. The more sophisticated players of course had their own research to draw on, but there were also a lot of marketers who piggy-backed on existing research that was readily available in the public domain, often created by programmes paid for by public health authorities desperate to find ways to encourage people to eat more fruit and vegetables. Those agencies should be pretty happy. Superfruits have worked wonders in terms of focusing public attention back on the health benefits of eating fruit. In fact, superfruits have been so successful at awaking consumers to functional benefits from fruit that many shoppers now take such benefits for granted and are now asking for a lot more in return for the super premium prices superfruit products demand. That means any company looking to join or keep up with the superfruit trend is going to have to work a lot harder to keep consumers interested, and the same goes for the wider functional food category. Marketers have bombarded consumers with so much information on potential health benefits that consumers are beginning to take them for granted – especially when the claims are fairly generic, such as “a
rich source of antioxidants”. These claims are relatively easy to make, so are often utilised in marketing and have in turn become commoditised and much reduced in value. Consumers, who once took it on faith that fruit, vegetables and whole grains are generally good for them based on basic science, have slowly shifted to demanding detailed information on the specific health benefits. Are they now shifting again? Demanding to “feel” the beneficial effects themselves as the ultimate “proof ” of efficacy? It looks that way. Discerning consumers are effectively saying “Functional foods are old news. Who cares how something works? I want proof it works, I want to feel it, now. I want food that I know is better for me because it lets me perform better!” Enter the notion of ‘Advantage Foods’, a new concept to describe those functional foods that offer real benefits that can be felt by consumers. Just think caffeine. Worldwide coffee sales each year exceed US$70 billion, add to this the caffeine-based energy beverage market and you have many more billions. So why is a consumer’s love of caffeine so strong? Because they can feel the resulting benefit, they can feel that wake-up boost of energy and they want that ‘caffeine kick’ so synonymous with the product. The good news is that fruit still ticks all the right boxes for many consumers and that with the right
investment and marketing substantial premiums can still be built and maintained based on the healthy promise of fruit-based foods and functional ingredients. As our understanding about the specific compounds in fruit and vegetables that make them beneficial for us increases we are starting to see more functional food ingredients with both proven health claims and genuine benefits that consumers can feel.
“Consumers are relying heavily on the foods they consume to improve their wellbeing.” If we look at how consumers make food purchase decisions, I’d argue that many consumers are still trading off established often conflicting drivers. They want novelty, but also the comfort of familiarity. They want convenience, but not at the expense of their perception of “natural”. They certainly want healthy, but also a degree of pleasure, they want “slow food” sentiment and a “fast food” delivery. Fruit, particularly new fruit cultivars bred with consumer preferences in mind can deliver all these attributes – and the ongoing success of superfruits proves that. Recently though, a new decision july 2011 FMCG
has emerged for consumers to make: the balance between “natural” and “effective”. In reality this decision is not new, but it is certainly gaining a new importance in consumers’ minds – largely because of what superfruits have taught consumers about fruit, health and the human body. So are proven health claims enough? They’re top of the list within the industry at the moment – having
just a proven claim is no longer enough to motivate consumers to buy. Companies looking to remain at the forefront of the functional foods market should be looking hard at any new innovations that offer both validation and benefits you can feel.
Wellness – a hot topic at IFT 2011 “Today’s consumers are extremely sophisticated, and they are attracted to functional foods’ ability to help manage health and wellness,” said IFT spokesperson Dr Roger Clemens. Simply put, consumers are relying heavily on the foods they consume to improve their wellbeing. That’s the news from IFT, the world’s largest annual food science forum and exposition, which was recently held in New Orleans. IFT, or the Institute of Food Technologists, offers accurate, timely scientific resources and each year thousands of food scientists, suppliers, marketers and news reporters attend the convention, attracted by the promise of encountering the driving forces behind the innovations and information affecting consumers, growers, processors, regulators and researchers. During this year’s show experts from companies, government agencies, and research institutions provided insight during more than 1000 presentations covering topics ranging from new health and safety benefits and product innovations to the latest consumer favourites, fears, and trends.
Plant & Food Research, the Crown Research Institute charged with supporting New Zealand’s horticulture and food industries, once again attended the global tradeshow to highlight the latest science innovations from its Food Innovation Portfolio as well as to network with some of the biggest names in the food industry. “The international tradeshows we attend are an important part of how we stay at the forefront of both science and business,” says Plant & Food Research spokesperson Mike Shaw. “New Zealand has long been a country that outperforms its geographical size in the food sector. IFT and other shows like it help us maintain the international science and business relationships needed to succeed in the increasingly competitive food industry and deliver value back to our New Zealand food industry partners.” At the IFT’s annual food science forum and exposition, Innova Market Insights announced 10 top trends in nutritional and functional foods. 1. ‘Proven’ is the new buzzword 2. More soft health claims (by companies unable to deliver sufficient proof) 3. Relaxation beverages 4. Fruit & vegetable revival 5. Joint health 6. Immunity 7. Alternative protein sources 8. Healthy mind, healthy body 9. Gut health 10. Weight loss.
Karl Crawford is business manager – food innovations at Plant & Food Research. Karl.Crawford@plantandfood.co.nz
FMCG july 2011
fmcg.co.nz FMCG has a few web exclusive features to get you clicking.
Iron Maiden team gains two more stars Which two high-achieving women were recently announced as new sports ambassadors by Beef + Lamb New Zealand? Find out in our online report by Beef + Lamb New Zealand marketing and communications executive Ashley Gray.
Hawkes Bay beats Barossa In which country did New Zealand’s Hawkes Bay beat the Barossa Valley in a ranking of wine regions, according to regular wine drinkers’ purchases? Find out on fmcg.co.nz!
Frucor ‘Best Employer’ Frucor was one of only two New Zealand organisations awarded Best Employer status by Aon Hewitt this year, and one of only nine organisations in Australia. Go online to see more details of this huge achievement for Frucor.
High pressure helps secure export deal The Kiwi avocado industry has secured a multimilliondollar export deal with Japan thanks to its new food-processing technology. Take a look at Fressure Foods’ latest developments on fmcg.co.nz
20 clever ways to use your smart phone
Debbie Mayo-Smith is a sought-after technology speaker and trainer showing us how to make great gains in time and profits from minimum effort or cost. Check out her smart phone tips – online!
An extensive archive of previous issues of FMCG you may have missed as well as news, category reports and more.
friendly foods FMCG caught up with some of the exhibitors at the popular Gluten Free Food & Allergy Show in Auckland to find out how their products fared.
The Healtheries team: James Ford (senior product manager) and Candy Hughes (assistant product manager).
eople visiting the show were delighted to find our full range of Healtheries Simple wheat and gluten-free products on display, including breakfast cereals, pastas, bread and baking mixes, baking ingredients, chocolate puddings and snack bars,” says senior product manager James Ford. He adds, “Many people had tried some of our products but had not seen others. We also offered samples of Healtheries Kidscare and The Wiggles new snacking range, which were very popular with mums looking for gluten- and dairy-free options for their kids. The show was a great opportunity to answer people’s questions about what is in our products, and importantly for those with wheat and gluten allergies what our
FMCG july 2011
products are free from. “We were frequently asked by visitors where they could buy our products, as once they find a product that works for them, wheat- and glutenfree consumers are very loyal and will buy on a regular basis,” said Ford. The most commonly requested item at the Healtheries stand was Simple Baking Mix. Ford explains: “Many customers use it every week and seek out the product at other supermarkets if their local does not stock it. We’d encourage buyers to increase ranging and shelf stocks on this item as it is a versatile baking product that is proving very popular. In fact, we ran out at the show on Saturday and had to get another pallet in to cope with demand on Sunday!” Healtheries Simple is a trusted
brand, offering a wide range of products all endorsed by Coeliac NZ with the crossed grain logo. Ford comments: “We would ask buyers to look at which Healtheries Simple products they are not currently stocking and consider ranging them to maximise the opportunity to drive growth and cross-sell in a category where customers are looking specifically for wheat- and gluten-free and variety in their diet.” He adds, “We have launched a new look range of Simple wheat- and gluten-free pastas. Now made in Italy, this great tasting authentic pasta comes in 250g packs of Spaghetti, Spirals and Rigatoni.Also, we are just launching an exciting new gluten-free Healtheries snack, called Kidscare Corn Tubes, which is made from wholegrain corn
featu re and comes in multipacks of 10 in Nacho Cheese and Chicken flavours. Each serving provides 2g of fibre and has less than 2g of fat, which equates to more than double the fibre and 65% less fat than regular potato chips.”
Best selling pizza bases Venerdi had another very successful presence at this year’s show, says sales manager and joint owner Phil Grainger. “Although Venerdi ‘full flavour six seed’ gluten-free bread is NZ’s top selling gluten-free loaf, at the show it was third in sales from our stand. The best-selling item was Venerdi pizza bases followed by the gluten-free baps,” says Grainger. The most commonly asked question at his stand was: “Where can we get the pizza bases?” “Our pizza bases are not always ranged – they are in many New World and Pak’nSave stores – but are not ranged in Countdown, Woolworths or Foodtown,” explains Grainger. “We supply Hell Pizza, Domino’s and many independent pizzerias and think that our bases are the best! “Venerdi is now going through an intensive product development phase
to improve the organic range and by the end of the year you will see the results,” says Grainger.
Cafe-style cereals Smartfoods’ general manager Vicki Taylor told FMCG: “We found the show really useful as always. We like to talk to our consumers and get their feedback.The show is superbly organised and really great to visit.” The most popular items at the Smartfoods stand were Vogel’s CaféStyle Light and Vogel’s Café-Style Light Berry. “They are the #1 and #2 selling no wheat/no gluten cereals in NZ,” commented Taylor. Consumers were looking for new flavours and new low-sugar or nutfree options at our stand, says Taylor. She adds: “Vogel’s cereals are available in supermarkets and selling well, but new products are also currently under development. The feedback from the show was instrumental in deciding how we would progress.”
Sugarfree treats Sugarless Confectionery national manager Thea Mayes said: “Our products are unique – the first total concept of sugar-free, gluten-free and dairy-free
chocolates and lollies in NZ. Our most popular product at the show was definitely marshmallows and chocolate. People couldn’t believe they were eating a product with no sugar. After tasting the product and the initial shock of the ‘can I really have this?’ the next question was ‘where can I buy it’?” The answer: Some New World stores and Life Pharmacies stock the products. “The most commonly requested products at our stand were the Marshmallows and Kids jellies, which provide a great alternative for mums looking for sweet treats for their children,” says Mayes. She adds: “Currently we are working with Foodstuffs Auckland and Foodstuffs Wellington as well as being available in some South Island New Worlds. They have been absolutely
Simple to use and simple to prepare, the Healtheries range of wheat- and gluten-free products includes breakfast cereals, pastas, bread and baking mixes, plus baking ingredients. Healtheries Simple offers your customers not just the safety and nutrition they require, but also the pleasure and convenience of great-tasting food. NEW LOOKA PAST july 2011 FMCG
Following on from the hugely successful Auckland show, Healtheries will be at the Wellington and Christchurch Gluten Free and Allergy shows too, raising awareness of our range and giving out coupons to drive customers into your store.
feat ure fantastic in helping us to supply our customers! We offer a healthy and yummy alternative not just to those with allergies but also the general public. This year we have some great new products coming to the market â€“ a beautiful box of sugar-free and glutenfree praline specialty chocolates, perfect for special occasions, as well as some new chocolate bars; cranberries in dark chocolate, blueberries in dark chocolate and whole raspberries in white chocolate. Plus a couple of new â€˜top secret linesâ€™ â€“ so you will have to keep an eye out in your local store!â€?
Nicolaâ€™s Organics Many potential customers were interested in the new Nicolaâ€™s Organics Plain Oat Singles at the show, as well as Nicolaâ€™s Organics 96% Fat Free Toasted Muesli and Nicolaâ€™s Organics Unsweetened Muesli, which was of interest for diabetics. â€œThe Nicolaâ€™s Organics gluten-free and wheat-free mueslis were also very popular and we were surprised at how popular the oats products were,â€? comments Harrawaysâ€™ marketing manager Rosalind Goulding. She explains: â€œMany people are switching to oats for all the good
health benefits of extra fibre and a natural food that is low in fat and which provides sustainable energy. Most visitors asked where they could purchase our products and we had included a list of supermarkets and stores on our information sheet. More information regarding the gluten in oats and Nicolaâ€™s Organics Plain Oat Singles is available on our website www.harraways.co.nz .â€? Goulding adds: â€œHarraways and retailers are supportive of the New Zealand organics industry and products that are BioGro certified, which are produced from sustainable agriculture. This is important as many items labelled â€˜Organicâ€™ are being imported but lack valid certification.We encourage potential customers to contact us so we can advise where the Harraways and Nicolaâ€™s ranges can be purchased.â€?
All about BĂźrgen Brand manager Tina Park told FMCG: â€œAt BĂźrgen, we know that all too often, gluten-free breads lack the taste and texture of regular bread. So our goal was to create bread that was completely gluten free but with the taste and texture our consumers miss so much! First we built an entirely new dedicated production facility at our Wiri bakery in Auckland.
Then we refined and re-refined our recipes until we were satisfied. We wanted BĂźrgen Gluten Free bread to be more than good for you. We wanted it to taste great! Consumers have our guarantee that all BĂźrgen Gluten Free products are: â€˘ Gluten free not taste free â€˘ Wheat free â€˘ Yeast free â€˘ Made separately from other products containing gluten.â€? â€œThe product that attracted the most interest at our stand was BĂźrgen Ancient Grain & Seeds,â€? says Park. She explains: â€œPacked with flavour and extra goodness, BĂźrgen Gluten Free has the Gluten Free X Factor. Aztec superfood chia, sunflower seeds and linseed give magnesium for energy, dietary fibre for digestive health and Omega 3 ALA to help maintain heart health. Plus, they all add to that extra flavour consumers want in your gluten-free bread.â€? BĂźrgen Gluten Free bread is available in most major supermarkets, large corner dairies and selected health specialty stores.
Freedom Foods Breakfast cereals Maple Crunch and TropicOâ€™s, as well as biscuits Triple Treat Brownies and Blissful Berry
are well known to the South East Asian market. Made by Hua Huat, one of Malaysiaâ€™s leading snack manufacturer. From their extensive range of snacks on offer, there will be five different flavours launched onto the NZ/Australian market. There are four seafood flavoured chips extruded in different shapes which have been described by kiwi consumers as â€œcrispy & moorishâ€?. Plus a popular gluten free snack â€œBika Tapioca Chipsâ€? in a 70g bag. All snacks are halal. FOR MORE INFORMATION ON BIKA SNACKS PLEASE CONTACT:
/RIENTAL -ERCHANT 0TY ,TD s 4EL s &AX s %MAIL NZENQUIRIES ORIENTALCOMAu s 7EBSITE WWWORIENTALCOMAu
FMCG july 2011
<RXGRQÂ¶WKDYHWRPLVVRXWRQHQMR\LQJJUHDWIRRGMXVWEHFDXVH\RXDUHJOXWHQLQWROHUDQW7U\RXUUDQJHRI JOXWHQIUHHSURGXFWVZKLFKDUHDOODYDLODEOHIURPOHDGLQJVXSHUPDUNHWVRUJDQLFDQGVHOHFWHGKHDOWKIRRG VWRUHV2XUUDQJHLQFOXGHVSDVWDVEDNLQJPL[HVELVFXLWVFULVSEUHDGVFKRFRODWHVDQGVQDFNEDUV (QMR\RXUWDVW\SURGXFWVDVSDUWRI\RXUKHDOWK\GLHW
)UHHIURP*XLGH (JJ 'DLU\ <HDVW
2UJUDQ /HGD 6ZHHW:LOOLDP (VNDO 1DWXUDOO\*RRG 3URGXFWV )RUPRUHLQIRUPDWLRQHPDLO&URPELH 3ULFHDWLQIR#FURPELHSULFHFRQ]
feat ure were the most popular items at the Freedom Foods stand and visitors frequently asked where they can find these products in the shops. “To keep abreast of our product range and where to buy, you can visit us at www.freedomfoods.com.au,” said marketing manager Jane Kaleski. She revealed that Freedom Foods are also launching a new product soon: Berry Good Morning. “It is our new combination breakfast cereal with real diced dates and cranberry pieces,” she explains.
Hubbards Among the many new products that were popular at the show was Thank Goodness Gluten Free Brown Rice Porridge, which was the most commonly requested item at the Hubbards stand, according to Hubbards’ trade
FMCG july 2011
marketing executive Kristy Bovill. She commented:“We have distribution of all our products in the market, some available via some [supermarket] banners and not others. At the show we directed any interest to the banner that ranges the product.”
Apples galore Annies Marlborough stand sold out of Natural Dried Apple Slices on the first day. Visitors loved the taste and loved the fact they are dried with no sulphur or other preservatives. Many people were also interested in Fibrefruit fruit leather and the slow-release energy and digestive benefits of this 100% natural snack. “We are fully ranged in Progressive, partially ranged in Foodstuffs,” said Virginia Watson, Annies Marlborough marketing manager. She also revealed: “We have a very hot new product hitting the shelves in mid-August”. Meanwhile, at the Enzafoods stand, New FreshFields Apple Sauce proved popular with visitors.This new product is available in supermarkets, says Robin Percy, brand manager, Enzafoods New Zealand. She adds: “Dietician Anna Richards came by the stand and learnt it was made from the apple variety ‘Royal Gala’. Royal Gala is a bland sweet apple and is much lower in the naturally occurring food chemical called salicylate. Salicylate can be an aggravator of eczema in young children and is
not well tolerated in salicylate sensitivity. Anna then seemed to be referring people with the sensitivity to our stand and our sales exceeded our stock holdings on the day!” The most commonly asked question at the stand was where visitors could purchase CoolHitz pure fruit ice treats. “We hope that supermarket buyers will take this on in time for summer 2011,” said Percy.
Golden Goose Foods Joanna Williamson, co-owner of Golden Goose Foods, said: “Visitors to the show were equally impressed by each of the products in our range as they have been ‘no go’ foods for many of them. Of the gluten-free battered fish, southern style coated chicken, mini hotdogs and donuts available for sampling, probably the battered fish was slightly more popular, with people commenting how much they have missed sharing fish and chips with their families. People wanted to try all of our products just to check that they tasted just like the ‘real thing’ before buying them at the supermarket. We are steadily growing the number of supermarkets that our range of gluten-free products is available at.” She adds: “We have an exciting new product under development, but it’s under wraps at the moment until we are sure we have met our taste testing standard of it being just as good or better than a wheat-flour based version.”
feat ure Vitasoy
products, says managing director Rebecca Douglas-Clifford. With the assistance of the Foundation for Research, Science and Technology of New Zealand, Eat Right is currently developing an innovative mineral-rich product and some groundbreaking intellectual property in the area of ‘bioavailable micro nutrients’.” Eat Right aims to produce foods that are not only organic, allergy sensitive, natural and healthy, but proven as a natural source of vitamins and minerals.
Business manager Greg Smith found that the ‘Soy Milky’ range attracted the most interest at his Vitasoy stand. He says: “Many of the consumers had not tried a soy milk before and were thinking about incorporating it in their diet as a means for them to balance their diet or due to a dietary intolerance. The response was very positive as the soy flavour in Soy Milky is very subtle so that the flavour is more similar to dairy milk – which means that it is also a great option for children and the whole family and is also gluten and lactose free. Many people asked which stores it was available in or enquired about stores that were stocking the products in specific areas where they were struggling to find the products.” Smith explains: “People are looking for a wider range of options in soy products such as a wider variety of flavours and also there were many requests for yogurt and custard at the show.”
Coffee & Hot Chocolate Caffe L’affare marketing manager Jessica Godfrey told FMCG: “The Gluten Free Food and Allergy Show was a great vehicle for our range of Fairtrade, gluten-free hot chocolate, which allergy and gluten-intolerant consumers love because it has no additives – there are no thickeners, additives or fillers. Just the good stuff! We also took some coffee – which some were surprised to discover is gluten free as well.” The range of Caffe L’affare Fairtrade hot chocolate was very popular.Godfrey explains: “We have two in the range: Original and Dark. Both have a high cocoa content and are 100% gluten free. Consumers were very relieved to discover a gluten, dairy and additive free hot chocolate as the category is full of hot chocolates that include milk solids or wheat and corn products that act as a thickener. Fairtrade Certification was seen as a real plus as ethical sourcing
Eat Right Foods “We provide supermarkets and organic-health stores throughout New Zealand with Eat Right branded
Oat Singles 100% organic oats creamy fast-cook porridge
FMCG july 2011
of cocoa is a very real concern now for consumers.” Lots of visitors asked which stores stock Caffe L’affare Fairtrade hot chocolate as it is so difficult to get a glutenfree option – it was the most commonly requested item at this stand. “We served samples – both with either milk or soy.We were very careful not to cross-contaminate the steaming of the milks.An important concern for dairy intolerant and allergic consumers,” says Godfrey. “Consumers with allergies and intolerances are a growing market and the supermarket shelves should cater to this market, particularly with wellknown and trusted brands like Caffe L’affare,” she said.
Top Shelf Piri Piri Aioli with Horopito (New Zealand bush pepper) was in hot demand at the Top Shelf stand and many visitors asked where they can find the products in the shops. The most commonly requested item at this stand was Top Shelf Classic Tapenade. “Top Shelf is an all natural food range with fast growing brand recognition and a solid reputation for quality and flavour,” explains TopShelf Foods director Jesse Watson. He adds: “The company is also launching Top Shelf Fresh Mayonnaise this year.” For more feedback from show exhibitors visit fmcg.co.nz
On urban myths Dr Peter Stevens considers country of origin issues. Almost all of us hate receiving spam emails. Many of us enjoy receiving joke emails. Some of us appreciate receiving well-meaning advice and timely warnings circulated by email. However, a common challenge is working out which is which! Often a little knowledge leads us to read and accept things that seem plausible but are only urban myths. Recent examples are emails advising consumers to detect and avoid product sourced from China by ‘decrypting’ the GS1 barcode number. Typically these emails have graphic images of animal slaughter, food production and preparation in squalid, vermin-ridden conditions in China, followed by the revelation that Chinese sourced products can be reading the ‘country code’ in the Global Trade Item Number (GTIN) – the barcode number. Similarly, many of us would have seen the recent media flurry of stories about NZ-branded infant formula, Chinese nationals and assertions around NZregistered shell companies.There are various allegations that some products are making misleading claims, using NZ branding, NZ address details and/or representing Chinese-sourced product as NZ-based product. Let’s be clear – I’m one of those consumers who would like to know where the products I’m buying come from. Informed choice by consumers is very important. But I must point out that using the GS1 identifier as the method to work out country of origin is plain and simply wrong – a classic urban myth. GS1 was started over 40 years ago in the food and grocery sector to uniquely identify brand owners’ products. Now GS1 member organisations are in 111 countries, each member-owned and operated. The country registry for NZ run by GS1 New Zealand registers the allocation of unique identifiers to brand owners who choose to join in New Zealand. These are often, but not always, New Zealand registered and domiciled companies. But there is no assumption nor requirement that products allocated barcode numbers starting with ‘94’ are made or sourced from New Zealand. The most important thing the GS1 number does is uniquely identify the product in the supply chain, and ‘point’ back to the brand owner who is making the representations in the market about the product. This is why, for example, Pams’ products are all identified with GTINs allocated to Foodstuffs Own Brands. Foodstuffs Own Brands is the brand owner and
Dr Peter Stevens, ‘go to’ point for consumers – despite the chief executive, GS1. products being sourced or manufactured Email: email@example.com. under contract from many companies and countries. So back to urban myths and barcode numbers. Here at GS1 New Zealand we are aware that a small number of companies with address details either based overseas or care-of NZ-based lawyers are seeking to associate their products with the New Zealand brand – and part of that association is a GS1 New Zealand membership and a ’94’ prefix. Chinese companies exporting NZ products are entitled to look for support from GS1 New Zealand and get their GTINs from New Zealand if that is convenient. As stated above, GS1 standards are designed to enable global identification and trade.
Using the GS1 identifier as the method to work out country of origin is plain and simply wrong – a classic urban myth. The fact is that companies are sensitive to which country their GS1 prefix comes from. We know that some of these companies register in NZ deliberately. They want the barcode number on their products when scanned (eg on iPhones) to pull up New Zealand contact details, reinforcing the impression (rightly or wrongly) of New Zealand origin. This behaviour is an intriguing perspective on the interface between fact and urban myth – and perhaps proves the old marketing adage that ‘perception is reality’! july 2011 FMCG
cate go r y c h e c k
Little delights More and more artisanal cakes, tarts and biscuits are emerging in our stores, mingling with our favourite brands. FMCG takes a close look at classic and new flavours in the baked goods category.
unt Betty’s is a name synonymous with traditional home-style desserts in New Zealand so it’s no surprise that the brand has entered the cakes category with a quality range of Classic Cakes and Jam Tarts. The new Aunt Betty’s range will hit NZ supermarkets this month. Hansells Food Group has been selective in which products it is launching, working to drive growth of the grocery baking category by offering traditional flavours as well as new products that have proven successful in other markets and categories. “We’ve tried to keep the products as natural as possible and the result is an exceptional range of cakes and tarts,” says Rachael Bryers, senior brand manager at Hansells. Aunt Betty’s Classic Cakes are available in five flavours – Chocolate, Banana Bread, Light Fruit, Ginger and Carrot & Walnut – all popular flavours amongst New Zealanders. Aunt Betty’s is the only range of jam tarts being offered in the grocery baking category, available in Raspberry, Lemon and Apricot in packs of six. “We’ve already had a huge response from the trade with orders
FMCG july 2011
well exceeding forecast,” says Bryers. “Not only is the product offering of the highest quality, but the new Aunt Betty’s packaging has been designed to stand out on shelf and increase brand equity. You’ll see the new designs roll out onto the new Christmas range this year, and then onto the core steamed puddings range, creating a strong presence for the brand on shelf across the supermarket.”
Teacakes & Kisses The Delmaine brand features the traditional Dutch range: Almond Fingers and Delights, Apple and Almond Rounds and a new Tea Cake range. The latter is a range of miniature cakes with icing and filling. Hazelnut Tea Cakes are a light Madeira cake with hazelnut filling and a nut dusted hazelnut icing. Jam Tea Cakes are light Madeira cake with cherry jam filling and a Dutch white icing. The Jam variant has been available for six months and the Hazelnut variant is available from this month. Delmaine Fine Foods group product manager Micheal Bennett told FMCG: “The Rosedale brand has been an established name in the cake market
bi scui ts & baked go o ds
for many years and is synonymous with our top selling Ginger Kisses product. Within this range there are also Chocolate and Maple Walnut Kisses. Equally as well known and a traditional favourite are Rosedale Brandy Snaps and Baskets; while popular all year, they are absolutely huge at Christmas.” He adds: “Growth across the board has been strong, although the ‘Kisses’ have suffered over the past two months due to the shifting of the factory.” The shifting of the plant that makes Kisses and Snaps to Auckland is big news for the category. Bennett explains: “Aside from offering more space, the new plant
should be more efficient, so creating a double boost to capacity. Although we make a large range of products on this line for both here and overseas we see this move as possibly opening up opportunities to do more types of products, as well as greater volumes of existing ones.” Bennett highlights a few new trends in this category: “The first is the introduction of a number of premium or super premium products from smaller suppliers and a couple from more mainstream suppliers. It will be interesting to see where
these go. The other area of interest is the increasing impact of in-store bakeries on proprietary cakes; these are becoming both larger and more sophisticated as well as purchasing a number of premade products from outsourcing suppliers.”
THE BREAKDOWN Current MAT to 22 May 2011 Total Biscuits incl RiceWafer/Cakes: $358.348m Val % Chg vs YA 2.0 Total Enrobed Biscuits: $84.268m Val % Chg vs YA 3.6 Total Cracker Biscuits: $86.277m Val % Chg vs YA -1.8 Total Plain Sweet Biscuits: $49.154m Val % Chg vs YA -1.5 Total Rice Crackers: $35.771m Val % Chg vs YA 13.5 Total Children’s Biscuits: $35.876m Val % Chg vs YA 5.9 Total Cookies: $28.522m Val % Chg vs YA -9.7 Total Cream & Jam Biscuits: $20.247m Val % Chg vs YA 10.7 Total Rice Wafers/Cakes: $10.554m Val % Chg vs YA 2.9
Total Assorted Biscuits: $7.678m Val % Chg vs YA 12.3 Total Cakes: $30.682m Val % Chg vs YA 5.6 Total Slices: $8.050m Val % Chg vs YA 2.7 Total Kisses: $2.933m Val % Chg vs YA -6.9 Total Meringues/Pavlovas: $5.706m Val % Chg vs YA 8.0 Total Other Types: $3.999m Val % Chg vs YA 46.6 Total Sponges: $2.921m Val % Chg vs YA -1.3 Total Plain Cakes: $1.453m Val % Chg vs YA 2.9 Total Brandy Snaps: $1.167m Val % Chg vs YA 1.3
Total Loaves: $1.585m Val % Chg vs YA 2.0 Total Fruit Cakes: $1.701m Val % Chg vs YA 1.6 Total Eclairs: $276,946 Val % Chg vs YA -6.2 Total Iced Cakes: $379,813 Val % Chg vs YA -39.9 Total Muffins: $265,103 Val % Chg vs YA 1,929.1 Total Tarts: $123,271 Val % Chg vs YA -45.7 Total Cakes: $78,503 Val % Chg vs YA 12.8 Total Cheesecake: $42,363 Val % Chg vs YA -44.4 Total Brownie/Slices: $1,450 Val % Chg vs YA -7.3
* ACNielsen New Zealand ScanTrack (Databank)
july 2011 FMCG
cate go r y c h e c k
Arnott’s biscuits In the past 12 months, Arnott’s NZ has contributed to the growth in the category (Arnott’s MAT $ growth +4.3%, Category growth +2.0%)*, says Arnott’s Biscuits’ category development manager Rachel Johnson. She explains:“Arnott’s holds brand leadership across the key segments of the biscuit category with Tim Tam the number one brand in chocolate and Shapes number one in savoury. Farmbake Cookies is number one brand in Cookies and a family favourite and Vita-Weat has a 100% natural offering across Crispbread, Crackers and now Rice Crackers.” She adds:“Arnott’s NZ has worked very hard in the past 12 months to bring category expanding innovation that has been well supported and aligned to the key consumer growth drivers of ‘something special’ and ‘wellness’.” It’s been an exciting 12 months with a variety of launch activities such as Shapes Sensations. Johnson comments: “The most pleasing aspect of this launch was being able 38
FMCG july 2011
to drive consumption with the previously under-indexed adult household market via a premium range of more sophisticated flavours. “Vita-Weat Rice Crackers has been 100% incremental to the previously stagnant Rice cracker segment. A 100% natural, uniquely differentiated product that is well supported with strong TV and in-store activity has seen this launch become a real success.” Tim Tam Dark Mint and Rum and Raisin are also among recent launches. “It’s well known that Dark chocolate is on trend at present.These new flavours will enable NZ’s number one chocolate biscuit brand to drive category growth,” says Johnson. A further launch is Farmbake White Chocolate and Triple Chocolate (with packaging change). Johnson comments: “Farmbake remains a NZ family favourite and we are very pleased to bring two new flavours as well as an exciting new packaging look that will be sure to invigorate the Cookie segment.
“Arnott’s NZ is committed to continuing to drive category growth via innovation and strong marketing / in-store support this year,” says Johnson. *Nielsen MAT growth to 24th April 2011
Oreo: ‘Twist, lick and dunk’ The total biscuits category including rice crackers and wafer cakes has total value sales of $358.3 million and is growing at 2%*, says Cadbury category development manager Victoria Stewart. Total sweet biscuits has total value sales of $225.7 million (63% share of category) and is growing at 1.8%, total savoury biscuits has a total value sales of $132.6 million and is growing at 2.3%*. Stewart says: “An opportunity exists to grow the sweet biscuits category in New Zealand with the Oreo brand, which is undeveloped versus its success globally. Oreo was first sold in New Jersey in 1912 and today Oreo is sold in over 100 countries around the world. It is
bi scui ts & baked go o ds
currently the number one biscuit in the United States and is believed to be the world’s most favourite cookie. Oreo is quickly gaining popularity in New Zealand with 80% of households aware of the Oreo brand and over half of these households having tried Oreo**.” With New Zealanders’ love of biscuits, being the fourth highest per capita consumers of biscuits in the world, Oreo is offering us something a bit different. Stewart explains: “Oreo is a brand with a fun and playful eating ritual: ‘Twist, lick and dunk into milk’, which helps people truly savour the Oreo experience. With increased focus from Cadbury, a Kraft Foods Company, in the past 12 months the brand has seen significant growth. Oreo has grown 77% in the latest quarter versus last year and is driving growth of the cream/ jam filled segment, which has been the major driver of total sweet biscuit growth*.” In the past 12 months two new products have been launched: Oreo with Chocolate Cream 150g and
Oreo with Strawberry Cream 150g, adding more variety for consumers, as well as the Snack Pack offering – the original Oreo Vanilla Cream cookie in convenient ‘on the go’ packaging. “These additions complement the existing range of Oreo Vanilla Cream 150g, Oreo Vanilla Cream 300g, Mini Oreo 115g and Oreo Wafer 180g. Oreo Vanilla Cream 150g ranks number two in value sales within the cream/jam filled segment in the latest 13 weeks,” says Stewart. She adds: “The latest marketing campaign, which includes a new television ad, outdoor advertising and sampling, has helped drive these strong results, continuing to increase the number of people trialling the brand and purchasing regularly**.” *ACNielsen, Supermarkets Scan Data current MAT 22/05/11 **Colmar Brunton May 2011
Premium loaf Loaf ’s range of slices and sweet loaves is sold in a number of New World supermarkets in the North Island.
Some of the most popular ones are the sticky chocolate and ginger slices and the perfect lemon and sticky toffee loaves. Managing director Sean Armstrong told FMCG: “We also have the banana walnut and spicy carrot loaves, which are gluten free and delicious!” This year, loaf has also released a finger-licking-good range of doughnuts, cooked as they should be, rolled in cinnamon vanilla sugar and stuffed with boysenberry jam, chocolate ganache or spiced apple. The boysenberry variety has just been released in a four pack to keep up with demand. Armstrong comments:“The public can’t get enough of them. We sell over 15,000 doughnuts a month!” He adds: “We’re in the process of expanding our slice and sweet loaf range as we speak. Our customers love wholesome ingredients and no preservatives. They want to be able to emulate really good home baking, but with the convenience of being able to grab it off the shelf.” july 2011 FMCG
cate go r y c h e c k Delish Cookies The popular Delish Cookie range has been on the market for five years, starting with only one sku, Chocolate Chip. Moi Agencies managing director Mark Okeby says: “Based on the successes achieved we have introduced further variants over the years to bring our sku count up to six, which includes family favourites Gingernuts, Shortbread and Anzac. This is mainly due to the support we have received from retailers and consumers. The retailers support us as we offer significant margin opportunities at a realistic price point compared to the mainstream brands and the consumers have enjoyed a good quality biscuit at an affordable price.” Delish Cookies are New Zealand made to give that true homemade taste. The cookies are ideal for kids’ school lunches as they are slightly smaller than mainstream biscuits and are packed in 350g bags that give excellent value for money to the consumers. Okeby says: “We are currently launching two enrobed Cookies to our range:Afghan Chocolate Crunch and Orange Yoghurt Crunch. Again the retailers will enjoy a healthy margin and the consumers will pay a good price for a quality biscuit.”
Griffin’s biscuits Griffin’s Foods is the market leader in the Biscuits category with over 120 years of baking expertise and creating beloved Kiwi brands, say biscuits marketing manager Angela Monro and biscuits category manager Hamish Macpherson. As a category, Biscuits represents 3% of total Pre Packaged Grocery. Biscuits has four key segments, which are defined as: • Total Assortment 2.3% • Total Crackers 36.4% • Total Enrobed 23.9% • Total Family Sweet 37.4% (MAT to 15/05/11). 40
FMCG july 2011
Monro and Macpherson told FMCG: “Griffin’s is the key Biscuit supplier driving with 37.2 % value share and driving nearly 40% of the value growth MAT (Aztec 15 May 2011). Griffin’s has eight out of the top 10 biscuits in Grocery (Aztec Data MAT to 15 May 2011), including perennial Kiwi favourites such as Toffee Pops, MallowPuffs, Squiggles, Gingernuts, Super Wines, Cookie Bear Chocolate Chippies and Shrewsbury.” Griffin’s launched an innovative new Bites range in 2010, which extended biscuits into new formats and new consumption occasions. Griffin’s Bites were initially launched with three flavours (Toffee Pops, Squiggles and Mint Treats), and now MallowPuffs and Chocolate Krispie Bites have been added to the range in May 2011. Monro and Macpherson say: “Griffin’s Bites achieved strong share of Chocolate biscuits in the first quarter post-launch and have well exceeded expectations with
over $3.6m retails sales value in the Enrobed category of $65.1m (Aztec Data MAT to 15 May 2011).” In 2011 Griffin’s has brought some exciting new product innovation to the Biscuit category with the launch of the new Griffin’s Collisions range and extended the popular Griffin’s Bites product range, all supported by a major new consumer communication campaign. The Griffin’s Collisions range was introduced in May 2011, combining two of New Zealand’s favourite chocolate biscuits to create the ultimate chocolate biscuit.The Collisions range includes MallowPuffs Toffee Pops, MallowPuffs Mint Treat, Toffee Pops Krispie and Hokey Pokey Squiggles Chocolate Chippie. Consumers have already responded enthusiastically to this new range. In early June Griffin’s kicked off its ‘Dear Griffin’s’ campaign, spearheaded with extensive TV advertising support and strongly integrated with a social media platform focused on Facebook and You Tube.
What’s Hot MUSHROOMS: The 2011 Winter Sensation
new from healtheries kidscare corn tubes
Adding healthy, natural Meadow Mushrooms to winter meals like soups and casseroles effortlessly transforms them into something truly sensational. Mushrooms are also the perfect partner for salad vegetables, fantastic in kebabs with cubes of beef or lamb, tomatoes, and onions, or try them old-school Kiwi style, on thick slices of toast or fried with steak. Always delicious and so easy! Call Customer Services 0800 687 476.
For more information, please contact your local Vitaco salesperson or call 0800 268 872.
blackmores fights winter ills & chills
GF TREETS GLUTEN FREE FROZEN RANGE
Blackmores Respra Syrup™, a soothing chest tonic based on an extract of ivy leaf that supports respiratory health and clear airways and is suitable for the whole family. • Great-tasting fruity flavour • Non-drowsy • Sugar-free • Gluten-free • No artificial colours
gf treets is an innovative new range of gluten free battered products. Perfect for stores looking to build a gluten free frozen category the range includes Gluten Free Battered Fish, Southern Style Coated Chicken Strips, Mini Hotdogs and Donuts. The range has been enthusiastically embraced by gluten intolerant consumers.
• Fun new shape – like a healthy Cheezels – to add to the popular Kidscare snacking range • Made with wholegrain corn in great tasting Nacho Cheese & Chicken flavours • Handy multipacks of 10 – perfect for lunchboxes or snacks on the run
For more information please contact the Sales Manager: Golden Goose Foods
Phone: 03 384 4039 Mobile: 021 226 6469 Email: firstname.lastname@example.org Web: www.gftreets.co.nz Always read the label and use as directed. If symptoms persist see your healthcare professional. TAPS PP9994
july 2011 FMCG
What’s Hot freedom foods new great tasting breakfast cereals NEW to stores is a great-tasting, whole-grain breakfast cereal, Maple Crunch by Freedom Foods. Packed with goodness, taste and nutrition, Maple Crunch is high in fibre, low in fat, with no artificial colours or flavours! It is the ideal solution to break the boring breakfast cycle! Best of all, Maple Crunch is a cereal for the whole family to enjoy, not just for people who can’t have gluten, dairy or nuts! For more information please call 0800 448 725 or visit www.freedomfoods.com.au
LIKE SUGAR, ONLY BETTER
Natvia is a safe, healthy alternative to sugar and artificial sweeteners. Made using only two 100% natural ingredients, the premium (Reb A) part of the Stevia plant and Erythritol (a natural fruit nectar), you can bake, cook and sprinkle Natvia just like sugar (but with 95% fewer calories!). Ideal for those with diabetes, weight issues and specialty diets, Natvia is a safe, guilt-free way to satisfy a sweet tooth! Phone: 0800 118 311, email: email@example.com
FMCG july 2011
Ingham Red Box – Convenience & Variety The Ingham Red Box range continues to be a popular choice with families looking for easy-to-prepare hot and hearty meals on cold winter nights. With the range including Chicken Kiev, Cordon Bleu, Duets and Tenders, Red Box provides the convenience of cook and serve packed frozen products, with the assurance of 100 per cent quality New Zealand chicken. When convenience, quality and value are a must, Ingham Red Box is the ideal choice. For more information, contact the Ingham sales department on 0508 800 785.
Stand Out Packaging from Hellers Hellers Sausage Bites have had a revamp and they’ll be available in-store in July. They’re a really handy, bite-size snack ideal for entertaining, and kids especially love them. Mums love them too – they’re so handy and quick to serve up for parties and get-togethers for all ages. But be warned – these Hellers Sausage Bites are very, very moreish! Our Family Favourites Bacon range has also had a makeover and is due in-store in July with updated packaging incorporating the new look. This Family Favourites range provides a great quality everyday bacon at a great price. For more information contact Kevin Calder, National Sales Manager, at 03 375 5031 or email firstname.lastname@example.org
What’s Hot PROTECT AGAINST YELLOW STAINS AND WHITE MARKS ON CLOTHING WITH
Undesirable deodorant stains are a problem. Therefore a deodorant that does not leave residue on clothing is one of the highest needs for a deodorant among both females and males. For the past seven years the Deodorant experts at Beiersdorf have been searching for a solution that keeps you and your black and white clothes protected from staining. And this month, NIVEA delivers an innovative solution to this problem. New NIVEA Invisible for Black and White Deodorant offers more than just anti-perspirant protection. This deodorant also protects against yellow stains and white marks, keeping your black clothes black and white clothes white for longer. This revolutionary new technology has been performance tested by the Independent Textile Expert – Hohenstein Institute – and Patented by NIVEA. This 48hr effective anti-perspirant is available in both a roll-on and aerosol and is NIVEA’s first dual gender launch with 2 fragrances for Females – Clear and Pure – and 1 fragrance for Males – Power. With a huge marketing support package behind this launch, the truly innovative new NIVEA Invisible for Black and White Deodorants range will provide incremental growth to the deodorants category. See your Beiersdorf Territory Manager for more information.
july 2011 FMCG
cate go r y c h e c k
Fresh fragrance, family health and environmental concerns all come into play when consumers choose a laundry product. FMCG talked to some of the experts in this category to find out what’s new in our stores.
arthwise products are made and manufactured in New Zealand and all products are phosphate, nitrate, chlorine and ammonia free. The Earthwise Home range has recently arrived in supermarkets and includes laundry powders and liquids, fabric stain remover, oxygenated whitener, fabric softener and a wool & delicates wash. Earthwise also has a range of dishwash liquid, dishwasher powder, tablets & rinse aid; plus multi-surface cleaning spray, window & glass cleaner, multi-purpose cleaning concentrate, floor cleaner and disinfectant concentrate. In the past six months Earthwise has launched all the above products plus another three products in the bathroom range (24 products in total). “Our laundry products are exceeding retailers’ expectations and are selling better than we had anticipated,” comments Earthwise director Jamie Peters. He says: “Our laundry, dish and cleaning products have been ranged in Progressive, Foodstuffs Auckland and Foodstuffs Wellington. We are currently working with Foodstuffs South Island for distribution opportunities.” Peters explains: “The world is becoming increasingly aware of the
FMCG july 2011
environment and the impact that we are having on our planet. People have become far more environmentally conscious and are seeking out products that are friendly to the environment. We believe there is a general perception that to be ‘green’ is expensive, Earthwise has developed a model that makes being ‘green’ more affordable to the everyday shopper. Making a positive contribution to the environment no longer needs to be an expensive exercise.” He adds: “Customers who do purchase environmentally friendly products want to know they are purchasing authentic products from a credible brand. They want to be sure that what they are buying is not just a ‘green wash’ – essentially a product that says it’s green when it is not. Tom Robinson, the founder of Earthwise first started making plantbased products in 1964, so there is a wealth of experience and knowledge that Earthwise brings to this industry.” Earthwise will also be launching a full range of body products later in the year. Another environmentally friendly company, ecostore, also has new product developments for the Laundry category. Pania Newman, ecostore’s marketing executive – Australasia, explains: “Based on our strong laundry
liquid sales (ecostore 1 Litre Ultra Concentrate Laundry Liquid is the number one selling laundry liquid in NZ supermarkets based on dollar value – Aztec data, MAT, Quarter to 27/3/11) we are intending to launch an improved formula laundry liquid and a new formulation front loader specific laundry liquid. We’ve seen that in the Australian market, there has been a move to phase out phosphates in laundry detergents. Unilever has announced that laundry powders OMO, Surf and Drive will no longer contain phosphates. Woolworths, Coles & Aldi have also indicated their intention to go phosphate-free. “Phosphates released into our waterways contribute to the overgrowth and decay of some aquatic plant species which upsets the natural balance of the ecosystem and this leads to problems for aquatic life. As ecostore laundry products have never contained phosphates, they have always been better for the environment,” says Newman.
Natures Organics Earth Choice laundry products, inclusive of Wool and Delicates, are also available in New Zealand supermarkets. Among the company’s new product launches in the past 12 months are Earth Choice 750ml sensitive concentrated laundry liquid
laun dr y
THE BREAKDOWN Current MAT to 22 May 2011
and wool and delicates products. “Non-concentrated liquid is still our most popular laundry option,” comments sales and marketing manager Rodney Dowel. “However, we are looking forward to more consumers opting in for the concentrate once they realise the benefits.” Earth Choice non-concentrated was specifically designed to be ergonomic, that is, the bottle shape is almost square and yet is comfortable to hold and use. There is very little spare room in a carton. The idea is that the product can be transported as efficiently as possible. Dowel explains: “We started this process over two decades ago in an attempt to stop the transport of air space caused by bottle handles. This ultimately results in less transport emissions. It goes to show that when you have the right intention and put creative thought into packaging to find responsible solutions that it stands the test of time. More recently the wider market has opted to simply move consumers from nonconcentrate to concentrated liquids and powders and I see the trend of this continuing in super and ultraconcentrated laundry products. This is a better format as it saves transporting packages of diluted formula so will reduce transport emissions and waste due to the lower turnover of packaging.”
B_E_E: Proven ingredient safety B_E_E develops, sells and markets smart green household cleaning and laundry products with world-leading eco accreditation, internationally acclaimed design and top performance. B_E_E stands for Beauty Engineered for Ever, the combination of aesthetic, functional and ethical beauty. B_E_E sales manager Dorte Hald told FMCG: “The green segment is the fastest growing segment of the global household cleaning market. It constituted 3% of the total market in 2008 but is picked to accelerate dramatically, from 3% to 30% of the market by 2013*.” She adds: “With consumer trends for the household cleaning category emerging as ‘emotional, therapeutic and sensory, influenced by benefits such as family safety, health and wellness, aromatherapy, style and design, and environmental concerns’**, B_E_E is well positioned to take advantage of this growth. A further trend is the consumer need to ensure that ‘green claims’ are in fact valid and trustworthy.” Hald explains: “The 2010 Terrachoice report*** shows that the demand for legitimate green certification in household cleaning products is 50% higher than any other category. Large retailers now understand not just the increasing
Total Laundry Needs: $123.082m Val % Chg vs YA -7.0 Total Heavy Duty Heavy Duty Laundry Powder: $78.950m Val % Chg vs YA -9.6 Total Pre-Wash Stain Removers: $17.892m Val % Chg vs YA -1.8 Total Fabric Softeners/Antistatic Pads: $8.646m Val % Chg vs YA 1.5 Total Heavy Duty Laundry Liquids: $12.558m Val % Chg vs YA -5.6 Total Fine Fabric Washers: $3.081m Val % Chg vs YA -0.3 Total Laundry Soaps: $982,801 Val % Chg vs YA -0.6 Total Fabric Freshener: $363,218 Val % Chg vs YA -2.2 Total Ironing Aids/Laundry Starch: $326,744 Val % Chg vs YA -7.2 Total Clothing Dyes: $159,233 Val % Chg vs YA 3.8 Total Fabric Protectors: $122,608 Val % Chg vs YA 13.0. * ACNielsen New Zealand ScanTrack (Databank)
consumer demand for legitimate green products, but also the role that such products can play in protecting retailer reputation and credibility, as well as the risk of fakes.” She adds: “B_E_E products meet the need of the consumer and the supermarket by carrying the Environmental Choice New Zealand accreditation. This covers the safety of every ingredient as well as the packaging and manufacturing processes. B_E_E is the only range of laundry products available in supermarkets to achieve this accreditation.” july 2011 FMCG
cate go r y c h e c k B_E_E launched 3x Concentrate Laundry liquid 500ml and 3x Concentrate Laundry Powder 1.4kg in 2009. The Laundry range also includes a pure oxygen Whitener 1.2kg and Delicate Fabric Wash 500ml. B_E_E has launched a nationwide advertising campaign focusing on unparalleled credibility with the Environmental Choice New Zealand accreditation featuring prominently. * Mintel International, ‘Trends in Household Products’, March 2010. ** Packaged Facts, ‘Green Household Cleaning Products in the US’, May 2010. *** Terrachoice, ‘The Sins of Greenwashing: Home and Family Edition’, 2010. Report examines 5296 unique home and family products across 34 unique stores in North America.
Antibacterial range PZ Cussons New Zealand account executive Liz O’Meara told FMCG: “Reflect laundry powder is first to market with an antibacterial sub range that lets consumers kill the germs in a cold wash!” She explains: “This new innovation to the New Zealand market is spe-
cially formulated to kill germs at low temperatures and protects your family from unseen harmful bacteria. A special antibacterial agent makes washing at cold temperatures more hygienic. “Consumers no longer have to kill the germs in a hot wash, which will save on power and money. Line priced with our existing range, this innovative range is also very affordable. “Reflect Antibacterial helps protect your family from harmful everyday bacteria and provides you with the comfort and confidence that your laundry does not just look and smell clean – but is really clean. “Launched in May 2011, ranging and distribution results have been positive,” she says.
Fabric care Pental Products currently has a range of Fabric Care brands in the market: Huggie, Softly, Martha Gardener Wool Mix and Lux Flakes. New products that have been
launched in the past 12 months include New Huggie Essences – a 4x concentrated fabric conditioner containing an exciting new fragrance innovation. The ‘renewing freshness technology’ is activated by the friction on your clothes caused during normal wear, releasing a secondary fresh burst of fragrance and freshness. Other new products in the Huggie range include: Soft Floral and Water Lily that is Dermatologist Tested for Sensitive Skin in a 4x concentrate, as well as Jasmine and Cherry Blossom in the Regular range. Pental marketing assistant Lauren Knapic, comments: “Huggie has performed extremely well growing 30.1% in dollar share ahead of the total Fabric Softeners category growing at 1.1% (MAT 08/05/2011 Synovate Aztec Temple Data). For more information on the laundry category visit fmcg.co.nz
Earthwise Launches Environmentally Friendly Laundry Products
Earthwise products are environmentally friendly, naturally powerful and naturally kind. At Earthwise, we see the world as you do. It’s about you and your family and a partnership with nature. That’s why our range has been specifically developed for your living environments. Earthwise Laundry products are plant & mineral based and include fragrance free formulations for sensitive skin. Earthwise products are grey water and septic tank safe and contain biodegradable surfactants – a gentler choice for you and for the environment. The full Earthwise range includes products for your laundry, kitchen and bathroom, as well as general purpose cleaners. Contact: Jamie Peters at Earthwise on 09 578 5064, www.earthwise.co.nz
FMCG july 2011
g rocer y busi n ess New GM for Coca-Cola Oceania Coca-Cola Oceania has appointed Paul Fitzgerald as general manager. After 16 years with Coca-Cola Amatil (CCA), Fitzgerald has gained extensive experience within the Coca-Cola system across numerous markets and disciplines. He has worked in Sydney, South Australia and New Zealand and held a number of roles in finance, trade marketing and sales. “To have the opportunity to move to Coca-Cola Oceania and be involved in a business that sets the benchmark in terms of consumer and brand marketing is fantastic,” says Fitzgerald. 2011 is shaping up to be a big year for Coca-Cola Oceania with its involvement as Official Supplier for Rugby World Cup 2011, as well as its ongoing sponsorship of the All Blacks. “The local team has developed a comprehensive marketing
programme for 2011 that offers consumers ‘money can’t buy’ experiences. We look forward to revealing them over the coming months,” says Fitzgerald. Fitzgerald has had prior experience in New Zealand where he last held the role of general manager sales and supply chain for Coca-Cola Amatil (NZ). The Coca-Cola Company is the world’s Paul Fitzgerald. largest beverage company, refreshing consumers with more than 500 sparkling and still brands globally. Together with Coca-Cola, recognised as the world’s most valuable brand, the company’s portfolio includes 14 billion-dollar brands, such as Diet Coke, Fanta, Sprite and Powerade. l
Van Dyck Fine Foods doubles factory size Van Dyck Fine Foods is more than doubling its factory and production plant in New Plymouth to proactively target international clients for export growth. The $4 million plus expansion is scheduled to be operational by the end of September. Inge Vercammen and her bakery engineer husband Marcel Naenen moved to New Plymouth from Belgium in 2000. The pair opened their factory the same year and started producing crepes on bakery equipment designed by Marcel. The company has grown strongly over the past 11 years and is well known in New Zealand for producing high quality crepes, hotcakes, savoury pancakes and blinis under its foodservice and retail brands ‘Van Dyck’ and ‘Marcel’s’. The new factory expansion will be used exclusively to manufacture hotcakes. Van Dyck has the technology to add fruit or other specialised ingredients to its hotcakes including Belgian chocolate, strawberry, blueberry and other inclusions on request. Marcel has visited China and Europe on two occasions to source bakery and freezer equipment manufacturers that could create machinery to his specifications. An advantage of the new machinery is that the whole hotcake making process is automated. Hygiene and safety meet the highest international standards. Currently exports are 28% of business however the company expects this to change with exports being its major focus for the next two years. Van Dyck Fine Foods has recently secured a contract to supply hotcakes to KFC in Singapore and has appointed an Asian agent for representation to the Yum Food Group in Thailand, Indonesia and other Asian markets. Yum Food is a global corporate whose brands include Taco Bell, Pizza Hut and KFC.
As part of its export strategy Van Dyck Fine Foods has booked stands at three international trade shows with the goal of exposing its products to an influential range of international buyers. To up-skill, Vercammen has enrolled with the School of Export to gain a Diploma of International Trade, an internationally recognised qualification relating to export skills including language, culture, tax and contract law and international marketing. In this fast-changing world she believes constant learning is the key to success. “It’s something that I have to do to stay relevant, and connected with local and international market trends. It’s about analysing and creating an overview of the market, each culture and knowing how to act on any opportunities which our hard work may present us with.” l
Inge Vercammen and Marcel Naen at the Van Dyck Fine Foods factory.
july 2011 FMCG
Is your business
Top security consultants share their expert advice.
olice were praising the “gutsy” actions of a Hastings dairy owner who raised the alarm when she was confronted by an armed robber last month. An offender walked into the Karamu Rd dairy shortly after 12.30pm and pointed a gun at the woman and demanded money. But she pressed an alarm button and the robber fled empty-handed. “It was pretty gutsy,” detective sergeant Warren Murdoch from Hastings police said. “But if somebody is going to be pointing a rifle at you, do what you are told because money is not worth your life.” 48
FMCG july 2011
Armed police cordoned off several streets around the dairy and searched in vain for the robber for hours. How would you react if confronted by an armed robber? Do you have security systems in place to protect your staff, your customers and your stock? Many security companies offer a free assessment of your security needs. At the very least you may need to consider an alarm system installation or upgrade – or a service check of your existing alarm. You may also want to consider alarm monitoring options, intercom systems and CCTV video surveillance.
Alarm service and monitoring It is recommended that you have your alarm serviced annually and most alarm companies will remind you when a service is due. Benefits of having your alarm serviced include a reduction in false alarms and ensuring your alarm is working correctly. Alarm monitoring is vital for most businesses. When your alarm activates, signals are sent to the monitoring station and the contact numbers that you have specified are called in order until contact is made. A guard can be despatched if required. Having your alarm monitored also means knowing who is going in and
g rocer y busi n ess out of the premises and at what times. “The most common security problems in New Zealand dairies and supermarkets are theft by employees and customers and also armed hold ups,” says Clint Morris, sales manager at SLS Retail Theft Control. SLS Security Group has been in the security business for over 20 years and offers a nationwide service through its experienced network of technicians. The company’s comprehensive services include physical security, CCTV systems, vaults, computer security and even high tech forensic methods. “The key is providing evidence that the offender was onsite at the time of the event, which is where SelectaDNA hydra spray is the perfect solution. By having a spray system above the exit of a store, an offender can be reliably linked back to the scene. We also recommend quality CCTV images using IP/mega pixel camera technology.” Morris says it is all about putting in place as many obstacles as possible to protect the business, its employees and customers. Scope offers over 20 years’ experience and provides security consultancy and security audit processes for a range of commercial businesses throughout New Zealand, specialising in loss prevention, investigation and recovery of assets, explains managing director Hamish Kerr. Scope utilises specialist data gather-
A considerable return on investment can be realised by limiting stock loss through the unlawful actions of others. ing methods to ensure the daily business processes and specific risk issues are fully understood, prior to the security audit process being undertaken. Scope incorporates CPTED (Crime Prevention Through Environmental Design) methodology as part of its security audit process and considers that not one stand-alone security method, process, or piece of hardware can effectively provide a full security solution. It must be the right balance of a number of solutions (including the human factor), that is specific to the organisation or site being audited. Its services include: • Security risk audits • Organisational welfare analysis • Loss prevention consultancy • CPTED audits and consultancy • Critical incident management – (CIM) • Security consultancy and hardware installation. The most common security problem in New Zealand dairies and supermarkets – in Kerr’s opinion – is loss caused by high frequency theft, which can occur daily. “You could say that the impact of the global recession, the dramatic
changes in the value of the NZ dollar, global natural disasters, all have had some direct impact on the cost of goods to the consumer. The effect is that products that would normally have made it into the trolley aren’t, and the temptation to steal becomes reasonably obvious. High-value, small-sized items (such as razor blades, beauty products, medicines etc) will always be targeted. Therefore, specific electronic countermeasures and the store layout (encouraging natural surveillance) need to be utilised to specifically address this,” says Kerr. He adds: “The speed at which electronic security products are being developed and brought to market is quite staggering.The cost of these systems has dramatically dropped as well and has made them obtainable for most businesses holding and/or selling stock. “But the reality is simply this: CCTV systems are not crime prevention tools; they are crime detection tools. Unless someone is watching the monitors in real time, identifying movements of possible offenders, what are you actually preventing if you can’t intervene at the time of the crime itself or the preparation of it?”
Bottle Security Tags
www.vitag.co.nz Tel. 0800 736 352
Secure Hooks Adhesive Security Labels
july 2011 FMCG
g rocer y b us ine ss
The key to developing a smart security strategy encompasses a number of factors: 1.The actual environment that we are trying to protect and how it is used by people. How can we delineate the flow of people through the store itself in relation to certain products? Where can we put those high value smaller products that allow natural surveillance from the trained store staff? 2. The use of people in that environment: trained staff, store managers, in-store security, CCTV operators, or the use of undercover store detectives. Staff in the store environment, talking with customers or offering help, brings about the perception of guardianship of that space. 50
FMCG july 2011
3.The mechanical aspect, that supports the above two factors. Hardware such as Access Control Systems, MicroElectronic tagging, effective and evenly distributed lighting, and an appropriate security camera system can be effective tools when used in conjunction with the other factors. A CCTV system that is utilised to its full capacity, by actually having someone monitoring the system in real time, can truly become a detection and prevention tool. When the correct balance is found by incorporating all these factors, a considerable return on investment can be realised by limiting stock loss through the unlawful actions of others. “The biggest security issue in retail is shoplifting,” confirms Dave Hall, director of Secure Communications (Monitoring). “It’s insidious. And anyone who doesn’t believe it probably doesn’t have systems good enough to measure it. What’s going to stop shoplifting isn’t technology – it’s people. But technology gives them the tools to work with. “We supply alarms and surveillance cameras, as well as access control. We are also involved with Shared Faces, which is an information sharing website/loss prevention tool. Basically you log your offenders so your neighbours can see who’s operating in their neighbourhood. It works well in smaller communities. But it’s interesting the thinking that comes out of that mindset. Suddenly surveillance isn’t an end in itself – it’s a tool to obtain evidential grade video footage of offenders. So things like camera location, camera type, angle of view etc become important – because they affect the quality of the image you get, and because this website gives retailers a tool. “Ultimately it’s probably training that will stop shoplifting, training people to use all the tools at their disposal, – cameras being one, the Shared Faces being another example, and simply learning to care about the problem, believing
it’s preventable, and measurable.” Vitag is a NZ owned company that is totally focused on retailers. Vitag Security Solutions sales manager Paul Grunsell told FMCG: “We realise that grocery store loss prevention these days needs to go beyond the basics – that’s why we have scalable levels of protection dependent on the company’s individual needs.” Protection can be tailored to include complete, integrated solutions of CCTV, EAS, intruder alarms, access control, intruder deterrence (Smoke Cloak), and alarm monitoring services for the store’s exterior and interior. Specific protection is then offered on high shrink items within the store such as razor blades, liquor and batteries, and meat products. “For all retail formats, the ongoing exposure and risk of physical attacks is a concern,” says Grunsell. He adds: “Tougher economic and social pressures have seen an increase in many forms of petty crime. Internal theft is also increasing and although not as common as customer theft, the damage can be more corrosive and detrimental.” “If you contact Vitag, we will tailor a solution which will enable you to increase your products on display, reduce your shrinkage – and keep you and your staff safe, every day. There are some excellent products available from Vitag – feel free to visit our website at vitag.co.nz,” he says. For an up-to-date security system, his two recommendations for the grocery industry are: • Smoke Cloak – produces a dense (harmless) vapour reducing visibility to practically zero in less than 60 seconds, designed to rapidly force the intruder to leave the premises empty handed (proven worldwide fog security system and recommended by insurance companies). • Invue secure merchandising hooks and accessories – allows your customers full, limited or staff-assisted access to your valuable hang-sell and shelf merchandise.
New age marketing Which trends will influence the FMCG advertising and marketing landscape in the next year? Industry experts share their insights and predictions.
dvertising and marketing is evolving faster than you can say ‘App’. Consumers are going online more than ever, and shopping for groceries is no exception. Shoppers can now easily access product information and tempting offers ‘on the go’ and it’s clearly changing their behaviour. According to a recent consumer survey, 20%+ of shoppers research food and beverages before they enter the store and 62% of shoppers say they search for deals online for at least half of their shopping trips.* Of the shoppers surveyed, 37% use coupons, 47% use store circulars, 50% compare prices, and 58% use shopping lists.* But new developments are not limited to social media and mobile commerce – in-store marketing is also constantly changing. SPOS Group is a company that specialises in in-store marketing and point of sale advertising. NZ general manager Grant Turkington said: “Our three divisions SPOS Retail, icandy Creative and Propel Interactive allow us to give a comprehensive offering in marketing at retail including standard ticketing and merchandising solutions, custom design services and digital innovations. “We think that the next big thing to hit this part of the world will be QR (Quick Reference) codes. With the explosion of smart phones on to the market this technology, which has already been used in countries like
Japan and parts of Europe for a decade, will soon be picked up by retailers and brand marketers. Consumers want relevant product information and are growing more and more willing to use available technology like smartphones or instore kiosks, to access it.” Turkington explained: “QR 2D patterned images could be on product packaging or ticketing, or other POS in store. Using a smartphone app snapping a quick pic of the QR can instantly take you to detailed product information, promo and marketing info or direct the phone to a product website or peer reviews.The technology is simple and the options are endless so QR codes could be as common as the bar code in the very near future.” And what is his prediction for marketing strategies in 2012? Turkington says: “I believe we will see more integration of above and below the line advertising with point of sale marketing reinforcing above the line messages at store level. ‘The Mix’ alcohol display stand designed and produced by icandy Creative was part of a successful integrated communication strategy that included the use of the in-store display in their TVC advertising to aid recognition and increase in-store product sales. With the above-the-line media being so fragmented, even mainstream media has many streams, as well as social media growing by the day, the in-store activation and alignment with the above the line has never been more important.” Turkington adds:“With the increase
in use of online, mobile and social media, getting your multichannel marketing right should be a current focus for many retailers. Consistent flavour and offering across all your chosen media along with relevant information is key to maximising customer engagement with your product or brand.The physical store is still very relevant as an interpersonal and tactile shopping experience and retailers need to take advantage of these strengths. More customers are researching online or using peer-to-peer reviewing, but many still choose to make the final purchase in the store environment.”
Hypermedia study Every week, most of us go to the supermarket to buy groceries, but are retailers taking full advantage of this july 2011 FMCG
g rocer y b us ine ss opportunity to talk to shoppers? According to research from in-store marketing specialists Hypermedia, 62% of us make the final purchase decision in-store. Hypermedia, a company that connects shoppers and brands at the critical point of purchase through in-store media, recently conducted the biggest and most varied retail sector research ever seen in New Zealand, speaking to over 1500 people. The research highlighted how much potential there is for retailers to interact with shoppers in-store, an element largely ignored in the New Zealand marketing mix until now. The Hypermedia survey showed that, in addition to the large percentage who are walking into a shop without knowing what brand they will buy, there is also a significant group who change their mind. And in the majority of instances shoppers are just operating on autopilot. It appears shopper marketing isn’t as straightforward as we may think! The survey also shows there is an increasing focus on price, and 58% have reduced purchases on non-essential items. So how do retailers get shoppers away from focusing on price, and back to the brand? While there is a need to offer a simple, budget-conscious message that passers-by can read in a matter of seconds, there is also an opportunity for grabbing the attention in more relevant and innovative ways. One example of this is 3D floor mats that halt shoppers in their tracks. New and innovative methods like these alert shoppers to products they may not have thought of before. Another method is advertising on the checkout bars that separate different shopper’s purchases. This is an especially strong marketing weapon for products like phone credit or lottery tickets that are sold right next to the checkout. According to Wayne Simeon from Hypermedia, retailers need to be 52
FMCG july 2011
aware of the importance of matching in-store marketing with the message they are trying to communicate: “If you want to strengthen the relationship with the shopper, you would want to choose point-of-sale communication that makes them feel good about their purchase. For example, this could be a recipe that incorporates the product you are selling. This will go a long way to ensuring the customer feels they made the right brand choice.” Retailers will be only too aware that getting heard by the increasingly timepoor shopper is an ongoing struggle; there is a barrage of information fired at people everywhere they go, and there is an increasing cynicism of marketing tactics. Simeon believes the trick lies in providing helpful information that doesn’t feel like marketing. “Regardless of the product, the message needs to be distilled in the same way: an engaging visual, alongside a clear problem and an even clearer solution. The study shows 25% of shoppers get home and are missing a product they were planning on buying. This is clearly a great opportunity for brands and retailers to sell more by offering useful information, presented in ways that is quick and easy to understand.” Of course, shopper marketing is just part of the bigger picture. When you think that you’re talking to people who are in the store already, half the battle has been won. Converting these customers into shoppers, and ones with a genuine bond to a brand, is there for the taking. And it’s not confined to the supermarkets; any retail store can change hearts and minds by innovating, constantly evaluating and using an insight led and integrated in-store marketing approach.
Food label marketing New Zealand’s first food label marketing system has demonstrated it can achieve strong positive sales results for retailers by increasing average spend, increasing average items per basket and increasing sales of specific items, says ProScales marketing manager Ammi Trainor. Trainor explains:“ProScales AdPro, the only technology of its kind in New Zealand and Australia, consists of a software solution that can work with existing hardware to allow contextual information (such as promotional offers, competitions or recipes) to be printed out on the bottom of existing service deli, bakery or prepack labels.” Turning what has traditionally been an expense into a revenuegenerating tool, the system requires little change to existing work processes and is a smart way forward for supermarkets. “The advertisements can be either pre-programmed or can be changed easily on the fly, allowing retailers to respond quickly, as well as targeting changing demographics at any time of day,” says ProScales managing director Stephen Heaney. The system also has the ability to drive customers into store ‘cold spots’, as well as helping to clear perishable items that are nearing their best before date, thereby minimising wastage. In a slowly recovering economy, and with rising food prices, consumers are looking for more ways to save on their grocery bills, fuelling the growing trend of coupon use in New Zealand. The experts at ProScales predict that we will see coupon use become an accepted part of mainstream shopping behaviour in 2012. * http://blog.nielsen.com/nielsenwire/consumer/ survey-fewer-than-10-of-u-s-consumers-dislikegrocery-shopping/
Weâ€™ve been helping your product sales grow for over 25 years... ...maybe itâ€™s time we reintroduced ourselves.
SPOS Group specialises in in-store marketing & point of sale advertising. We provide a comprehensive approach to marketing at retail through our group of companies SPOS Retail, icandy Creative & Propel Interactive. This allows us to offer a full range of products & services in retail marketing including standard ticketing & merchandising solutions, custom design services & digital innovations. SPOS Group is proud of its success in leading its industry in the future of in-store marketing & effective shelf merchandising as well as providing clients with new & innovative products that fit their needs.
The SPOS Retail division supplies a comprehensive range of readymade point-of-sale products, retail shelving solutions, ticketing & product merchandising solutions. SPOS is a leading provider of marketing at retail solutions in New Zealand & Australia that are designed to enhance the overall appearance of products in-store & ultimately stimulate sales. We have over 25 years experience supplying retailers, brand manufacturers, sales promotion, advertising & print companies with a range of services. Our continuous research into new & upcoming retail trends means we can offer our clients the latest in-store marketing products & effective shelf merchandising.
icandy Creative delivers tailormade point-of-sale displays & creative concepts for brands & retailers. icandy is a full service creative agency focusing on marketing at retail solutions that influence shopper purchasing decisions. Our services include: concept development, graphic design, industrial design, print, project management & full production services. Our team of dedicated staff is backed up by the businessesâ€™ years of interaction with the retail industry & this knowledge is put to your benefit in every project we complete. We understand what you need to get that sales uplift in store.
Propel Interactive represents the very latest in interactive retail merchandising technology. We focus on point-of-purchase displays & solutions including comprehensively integrated printed & digital signage & electronic ticketing solutions, selfservice kiosks & informational & security merchandising products, that utilise the latest retail technology products to drive consumer decisions at the point-of-sale. Propel is about enabling retailers to use leading edge technology to improve the consumer experience in store. Our exclusive, best practice, channel partners are industry leaders & innovators with a customer list that includes the best of international retailers.
4104(SPVQtUtGtXXXTQPTHSPVQDPNtTBMFT!O[QPTDPO[t$PQTFZ1MBDF "WPOEBMF "VDLMBOE
Sweet fix FMCG investigates new chocolate trends in the convenience channel. Chocolate is a favourite snack on the go and among the iconic brands are Nestlé’s chocolate bars and treats, which are available for sale in C-stores and petrol stations: Kit Kat, Aero, Milkybar, Smarties, Rolo and Pixie Caramel. “Nestlé’s king-size Kit Kat, Milkybar and Aero bars are particularly popular in the oil channel where as much as 50% of forecourt sales are to ‘pre-family’ men,” explains Nestlé NZ confectionery category manager Georgina Pickford. She adds: “Also proving a hit in the C-channel and oil channel is Nestlé’s new Milkybar Buttons – a 20g pack of pint-size white chocolate buttons at a pint-size price, which is proving a popular ‘travel treat’ for busy families on the move.” Pickford says: “2011 is a big year for
FMCG February 2010
Nestlé chocolate innovation – which is all designed to add interest, excitement and value to the chocolate category.” Nestlé’s biggest innovation in chocolate in 2011 is Kit Kat Chunky 3. Three chunks of three different textures in one bar – it’s all about Fudge, Crisp and Flow! Kit Kat Chunky 3 is aimed at young men who are looking to get the most out of the spontaneous breaks they take throughout the day. Concept test results for Kit Kat Chunky 3 Caramel and Cookies & Cream variants were off the scale (top 10% of concepts ever tested by Nestlé worldwide). A big ATL promotional campaign will launch soon to connect with target consumers,” says Pickford. It’s also been a big 12 months for Nestlé’s Milkybar brand.
Pickford explains: “After a nationwide search, we found the wonderful Hinetaapora Short – New Zealand’s new Milkybar kid and the first girl ever to have been chosen. A new TV commercial has been on air and is getting rave reviews and helping to drive strong sell through for the brand. In addition, we have also launched two new products: the delightful Milkybar Buttons and the new Milk & Cookies flavour variant, which is proving particularly popular in blocks in supermarkets and king-size bars, which are exclusively for sale in the C-channel and oil channel.” Nestlé’s Aero brand has also been reinvigorated in the last six months – reformulated to cater specifically for the New Zealand (and Australian) palate, and now available in blocks as well as bars. “Aero, the original aerated chocolate bar, is ideal for those looking for lighter sweet indulgence which delivers a taste sensation!” Pickford says. “Kit Kat, Milkybar and Aero innovation has been supported by significant ATL and BTL support aimed at communicating new chocolate category news to New Zealand chocolate consumers,” she says. More exciting Nestlé chocolate innovation is definitely in the pipeline. With research suggesting that 60%+ of chocolate bar sales are impulse purchases, innovation is essential for keeping the category fresh and exciting for consumers. Pickford comments: “I think the three consumer trends hitting the chocolate bar category at the moment are ‘convergence’, ‘mini-treats’ and ‘light indulgence’. Convergence is a consumer trend which originates more in the technology field, but is starting to make its way into the food industry. Mobile technology now combines phone, web and camera functionality. Convergence in food, and in particular, in a chocolate context relates to convergence of favourite flavours and textures in a single
product. Nestle have capitalised on this convergence trend with the launch of the Kit Kat Chunky 3 range,” she says. Mini-treats are the second consumer trend which is proving popular in chocolate. Pickford says: “A great example of this is Nestlé’s 20g Milkybar Buttons. Consumer demand for mini treats is most likely driven by: a) affordability b) a desire to control portion size with higher levels of awareness around healthier eating c) a new ‘on demand’ mentality – driven from the entertainment industry.” Pickford explains: “Consumers can access entertainment via MySky, TV On Demand and Youtube on their terms – when and where they like. Chocolate mini treats such as Milkybar Buttons are perfect to stowaway in handbags, cars and office drawers and to access ‘on-demand’ when an immediate treat or reward is needed.” Finally, light indulgence is a consumer trend alive and well in chocolate confectionery. Pickford comments: “Aerated chocolate such as Nestlé’s Aero brand epitomises light indulgence – chocolate to savour, rather than devour and which leaves consumers, typically time-poor women aged 25-40, with a sense of satisfaction rather than guilt.”
Bites has a resealable bag, which is an important benefit for female shoppers who can share as well as savour. Senior brand manager Donna Lawgun told FMCG: “Cadbury chocolate bars are well loved and even with so many options available they hold strong consumer appeal. The Cadbury brands that Kiwis have grown up with continue to be favoured and consistently rank within the top 20 chocolate bars for value sales and Cadbury Luxury Flake is the number one SKU in petrol stations*. “Value sales for Cadbury chocolate bars in petrol stations continue to grow, +2.7% in the current MAT,” says Lawgun. Cadbury has launched three new chocolate bar ranges in the past 12 months, offering consumers continued variety under a well known and trusted brand. Cadbury Dairy Milk Bubbly was launched in 2010 and includes three flavours – chocolate, mint and white.
Cadbury’s brands Cadbury has a full range of brands and products available in convenience stores, petrol stations and supermarkets nationwide with iconic brands such as Cadbury Dairy Milk, Crunchie, Moro, Picnic, and Flake. Flake Bites were launched in June based on emerging macro trends, which indicate a move towards ‘little’ eg tapas, (less about the food and more about the sharing/socialising). Bitesize is a more accessible product format for consumers, allowing them to share and bond with friends anywhere, anytime. Cadbury Flake july 2011 FMCG
higher proportion of sales in twin bar or larger bars formats than in other channels as chocolate bars are seen as an easy snacking option when on the go,” comments Lawgun. *ACNielsen, Scan Data current MAT 22/05/11
Lawgun explains: “Consumer insights identified strong appeal for a lighter chocolate bar offering without compromising on flavour. This insight led Cadbury to develop the Cadbury Dairy Milk Bubbly range, which is also available in a 175g chocolate block. Understanding consumers’ need for a more convenient pack to get their chocolate fix on the go, Cadbury Dairy Milk has launched a roll pack range in the past 12 months. The Chocolate bar category continues to experiment with pack formats giving consumers a wide variety of choice.” Lawgun adds: “The Cadbury Picnic brand has been in rapid growth MAT +15.8% vs YA* due to two limited edition variants. Cadbury Picnic Roast Almond Feast was launched in February 2010 and Cadbury Picnic Fruit & Nut was launched in May 2011. Limited edition variants continue to keep Picnic top of mind with consumers whilst still delivering on the brand’s unique proposition, a delicious combination of peanuts, raisins, wafer and caramel covered in Cadbury milk chocolate.” Category research has found the four key occasions for chocolate bar consumption are ‘Hunger’, ‘Sweet Fix’, ‘Satisfy Cravings’ and ‘Treat Time’ and due to this diversity the chocolate bar category is highly impulsive. “In the convenience channel there is a
FMCG july 2011
Lindt Chocolate “Lindt Chocolate continues to grow ahead of the market in the Blocks and Boxed categories whilst adding value and profitability to the Blocks, Boxed Chocolate & Easter categories, as consumers trade up to premium chocolate,” explains Brandlines business manager Ken Davis. “Lindt Blocks growth is 54.4% and Lindt Boxed growth is 13.5% (Aztec latest QTR in TKA 29.5.11),” he adds. “The ‘NEW’ Dark Caramel Excellence is performing well and will drive further growth within the Blocks category, with a highly appealing new flavour combination to target mainstream shoppers. Excellence Dark Caramel is designed to encourage consumers to expand their repertoire within the Excellence Dark range. “Look out for a new and exciting, innovative Excellence launch later this year,” says Davis. He adds: “In Boxed Chocolate the Lindt Lindor Dark Assorted 150g has been added to the Lindor family with the same delectably smooth centre in four delicious flavours – Raspberry, Mint, Dark, and 60% Cocoa all encapsulated in smooth dark chocolate – and has proved popular during gifting occasions. “The Lindt Lindor 150-235g ranges have also had a pack refresh, and I think you will agree that the new packaging is stunning, and communicates premium to consumers. The Lindt Gold Bunny was again in high demand at Easter with consumers, and
we had very good sell through numbers in the accounts,” says Davis. Hersheys & Reeses Wilson Consumer currently sells the Hersheys range in this segment, including the ever popular Hershey Cookies n Crème and Creamy milk products. There are also a number of outlets which have started to range the Reeses range, from the instantly recognisable Reeses Peanutbutter Cups to the Reeses Pieces. “We have also recently launched the Jelly Belly range in to this channel,” says confectionery business manager David Cunningham. “Already there is a strong uplift as consumers see the new lines and these unique flavours,” he says. He adds: “In the past 12 months we have introduced the Reeses Peanutbutter cup in white chocolate as well as the recent introduction of the Skor bar in NZ.” Cunningham explains: “The new lines are performing very well as consumers are starting to look at alternative options to the traditional NZ flavour profiles. With the NZ population growing from a broadening background, the flavour preferences are slowly changing to reflect this. Also consumers are now more widely travelled and they like to see some of the international products on our shelves here in NZ when they return.” He adds: “We are looking to support the Reeses range with a sampling campaign. We find that giving consumers the chance to try this American favourite continues to win new customers over. “We are seeing consumer taste profiles change as they look to try new flavours and products. Consumers are also on the lookout for the new trends and often this channel will drive this as grocery becomes more conservative with ranging.” l
Tip Top scoops up big in NZ Ice Cream Awards Iconic New Zealand ice cream manufacturer Tip Top has scooped up six gold, two ‘Best in Category’ and four silver awards at the recent 2011 New Zealand Ice Cream Awards. There were a total of 250 entries in the 15th annual awards and a team of six judges took two days to judge the entries, spread over 11 categories. The judges awarded points for appearance, body, texture, flavour and melting properties. Awarded ‘Best in Category’ for its Vanilla and Boysenberry Ripple ice cream flavours, Tip Top also took home gold for its French Vanilla, Vanilla, Strawberries & Cream and Boysenberry Ripple offerings. Tip Top’s focus on innovation was rewarded when Chocolate Malt, a new flavour from Tip Top’s technologists, took home gold in the Open Creative category, while Creamy Yoghurt Ice Cream Strawberry received gold in the Low Fat category. “In our 75th birthday year, these awards
are further proof that Kiwis really love the fresh milk and cream, quality ingredients and delicious taste Tip Top has been famous for since 1936,” says Fiona Hyland, general manager of marketing & innovation. “As we look forward to the next 75 years, we’re committed to continuing to produce the delicious ice cream New Zealanders know and love and developing new and exciting products.” Tip Top produces approximately 35 million litres of ice cream a year and the three most popular flavours are Vanilla, Cookies & Cream and Boysenberry. Tip Top has been part of Fonterra since the farmer owned co-operative was formed in 2001. Drawing on generations of expertise, Tip Top invests significantly in research and development, to provide new and exciting products for New Zealanders. l
Employment agreements required by law The Department of Labour is reminding all employers that from 1 July 2011, employers must keep copies of employment agreements or terms and conditions of employment for all employees signed by both parties. “Employment agreements have been required by law since the introduction of the Employment Relations Act 2000. There is evidence that many workplaces still don’t have employment agreements in place, and this 1 July deadline will put responsibility on all employers to ensure agreements are in place, or they may face penalties,” says the Department of Labour’s chief advisor – employment relations, Craig Smith. “It’s the employer’s responsibility to maintain and keep an upto-date copy of each employee’s employment agreement that reflects the current terms and conditions of the employment relationship. Employers must also provide a copy of the agreement if an employee requests it,” says Smith. “Recent changes to the Employment Relations Act give labour
inspectors the ability to seek a penalty against an employer who is in breach of employment agreement requirements,” he says. “There are penalties of up to $10,000 for individuals and $20,000 for companies for failure to comply with the legislation,” says Smith. “If a 90-day trial period is agreed between the employer and the employee it must be in the written employment agreement before the employment begins, otherwise the trial period doesn’t comply with the law,” he says. There are some provisions that must be included in employment agreements by law, and there are also a number of minimum conditions that must be met regardless of whether they are included in agreements. The Department of Labour has developed an Employment Agreement Builder, to help create employment agreements – www.dol.govt.nz/agreementbuilder. l
july 2011 FMCG
Creating jobs for young people Trina Snow, executive director, NARGON.
Trina Snow considers youth unemployment.
The retail grocery sector is one of the largest employers of young people in the New Zealand economy. For many of those young people, it is their first job and, with no job history or references, employers have to take a bit of a gamble on giving someone a chance. However, the evidence is mounting that job prospects for young New Zealanders are bad and getting worse. Official figures put the youth unemployment rate for people aged 15 to 19 at nearly 28%.The number of young people engaged in the job market – namely, working or looking for work – has also dropped because of the tough employment situation. An obvious explanation for this increase in unemployment and decrease in participation would appear to be the current economic recession. That has certainly not helped but it does not account for the growing difference between youth and adult employment trends.There is another factor which has basically created this problem. Research from the Centre for Independent Studies (CIS) concludes “the sharp increase in youth unemployment from late 2008 appears to have been caused by the abolition of the youth minimum wage in early 2008”. Essentially, Dr Eric Crampton, a senior lecturer in economics at Canterbury University, concludes that up to 12,000 unemployed young people could have had jobs today if the youth minimum wage had been kept. Currently, New Zealand’s minimum wage of $13 an hour is about 50% of the average hourly wage. Crampton cites academic research showing that when a minimum wage is above about 45% of the average wage, there will usually be negative employment effects, particularly for young workers. He describes the detrimental impact of the minimum wage on young people as “well-known” and notes “dozens of papers finding that minimum wages hurt employment prospects for the people they’re intended to help”. He notes the Organisation for Economic Co-operation
FMCG july 2011
and Development (OECD) published research in 2010 supporting this view and noting that half its member countries (including Australia) had minimum youth rates. Crampton concludes that reinstating a youth minimum wage below the adult rate would not eliminate youth unemployment but it “would let employers start creating new jobs that young workers could productively fill”. His firm view is that “it is time to stop pricing young workers out of the labour force”. NARGON emphatically agrees with Dr Eric Crampton, the Centre for Independent Studies and the majority of labour economists who are in agreement on this issue. We have consistently supported a differential youth minimum wage and last year supported Sir Roger Douglas’ Minimum Wage (Mitigating Youth Unemployment) Amendment Bill, which would have reintroduced a differential minimum wage for those aged 16-17. Sir Roger told NARGON “an after-school job at the supermarket or as a check-out operator, working in the deli or even stacking shelves has been the first job for many young people as they step onto the career ladder and into paid employment for the first time. I believe that by setting the minimum wage at the same level as adults, it effectively priced young people out of the market.” In his view, “the real tragedy of setting youth wages too high is that many of those who can’t find work at $12.75 an hour – but perhaps could find work for $10 an hour – are forced to go onto the unemployment or independent youth benefit. In other words, we prohibit them from earning $10 an hour, and instead force them to earn $3 an hour, which is how much they earn on the unemployment benefit.” NARGON was deeply disappointed the bill was voted down without the public even having a say on the matter.We had expected National to at least support the bill to Select Committee so that evidence could be heard. Hopefully, Dr Crampton’s research re-ignites a sensible debate on the youth minimum wage. The evidence is compelling. One possibility is that the Government re-establishes the youth minimum wage at the current rate of $13 an hour and holds it until the adult minimum wage hits $16.25. This would restore the youth rate to 80% of the adult rate. It would be the difference between a job and no job for thousands of young people.
To find out about ad packages and rates contact: • Peter Corcoran on 021-272 7227 email email@example.com • Juleigh Buchan on 021-140 3456 email firstname.lastname@example.org
Point-of-Sales system with full Financial system and CRM
t5PVDITDSFFOT CBSDPEFT DBNFSB t/;%FWFMPQFE NPEFSOUFDIOPMPHZ t0OMJOF $3. "DDPVOUJOH $BTIVQ t#VJMUJO#VTJOFTT*OUFMMJHFODF
Phone 09-280 4403 www.MercoSi.com
BOOST YOUR BUSINESS WITH: Rental Chicken systems available Save on capital expenses Instant Results! Great Profits! Call now for a no obligation evaluation Jayen Food Concepts Ltd Freephone 0800 62 22 97 Email email@example.com Website www.toptastechicken.co.nz
15/2/10 12:42:31 PM
FOR LEASE - FOOD GRADE PREMISES Food Processing 560m2 70 Morrin Road, Panmure, Auckland This area was utilised for foodprocessing that had high MAF approval; the interior is lined with insulated cool store panelling and has food grade standard floors with drainage. Contained within this area is a chiller and blast freezer. $69,500 PA Contact: Grant 021 923313 (firstname.lastname@example.org)
july 2011 FMCG
the business of liquor reselling
Beyond Wine maven Bill Spence talks to Keith Stewart about 2011 vintages and the state of New Zealandâ€™s wine industry.
Bill Spence and his brother Ross are key figures in the renaissance of New Zealand wine, having started Matua Valley in the early 1970s and growing it to become one of the most influential and successful wine producers in the country. They also introduced New Zealand to
FMCG February 2010
Sauvignon Blanc, the variety that has become New Zealandâ€™s passport to international wine fame. After selling Matua Valley to Fosters, Ross retired and Bill invested in a new wine production venture, Moncellier Wines. His experience, both as a winemaker and marketer who
Sauvignon Blanc created in Matua Valley Chablis, one of the defining domestic wine styles of the ’80s, and as the first chair of the New Zealand Wine Guild, which established New Zealand’s export credentials in the demanding UK wine market, makes him a particularly valuable observer of the New Zealand wine industry. “I reckon the industry is now extremely divided,” Bill says, lamenting a loss of a culture of mateship that was once strong amongst the small winemaking community, and the strength its cooperative values gave the industry. “I grew up in a divided industry,” he says of his experience of his father’s company, Spence’s Wines, and the conflict between brewery dominated large wine companies and the small producers represented by the Viticultural Association. This ended with the creation of the Wine Institute in the early 1970s and a new sense of community and identity. “When we finally got the industry together, it made us strong and became one of the reasons we were successful in export,” Bill explains, although he also suggests that the old culture of friendliness may be part of the problem being faced by the industry today. “New Zealand Winegrowers want to be nice to everybody, when in reality they should be asking the hard questions,” he says. “Especially in the case of the big companies, who seem to have lost their passion for New Zealand wine. This is one of the prime reasons the industry struggles, there is no sense of identity where the big companies gain credibility from small producers,
and small producers have the advantage of big producers’ influence and scale. “New Zealand Winegrowers needs to make the case for the small companies to their bigger members in the way we did when we launched The Wine Guild. It was always a matter of making sure our promotions were structured so that they included small and large producers, and that we backed each other. “Big companies might now have overseas owners, but they are still benefitting from the export markets the whole industry was involved in making successful. “The big guys have a large influence over the direction and policies of New Zealand Winegrowers, to the detriment of smaller producers, and this can be seen in how we put far too much into Sauvignon Blanc at the expense of other varieties. New Zealand wine has become a onetrick pony,” says the man who gave Sauvignon Blanc its start here. “We have got Sauvignon Blanc bubbling along very well, so why not take the heat off there and put it on other varieties that we can be just as successful at. Sure, we need to keep Sauvignon Blanc simmering away, but let’s get other varieties to the boil as well. “Pinot Noir has been a success, but not because of anything Winegrowers have done. We have been lucky to have Martinborough, Central Otago and those regions’ own promotional efforts, to get Pinot out there. But what about Chardonnay and Merlot? They are forgotten, and wines like
John Hancock’s Tempranillo and Montepulciano are fantastic, but who wants to buy them because they remain a mystery to consumers?” Not that Bill wants to see the ‘brand’ New Zealand become too complicated with a rash of wines that are merely quick hits. “I am sick to death with the number of brands coming onto the market. In the old days winemakers like my father produced 83 different wines from 10 acres of vineyard. When Ross and I started we decided to focus on a few lines and do them well,” he explains. “That still works. It is what I do with Moncellier, and look at Jimmy Delegat. Under the Delegat’s and Oyster Bay labels he has a limited range of wines, and has become one of our most successful exporters.” So, aside from giving small producers a fairer deal, what should the industry at large be doing to improve its position, especially that of profitability? “To be successful in this business you ‘must’ understand the cost of production and work within it. Only then can you know how to save money so that you can compete.” l
Keith Stewart is writer at large for Mediaweb’s food group and foodnews editor.
july 2011 FMCG
D I STILLING
=W`fgU]kEfdS[YZf4agdTa`IZ[e]k P R O D UCE
Jim Beam Bourbon, the world’s numberone selling bourbon, has released Jim Beam 1795 in homage to the traditional distilling style, boasting the taste of how Kentucky Bourbon should be. Cellared for eight years before its release, 1795 is a premium tipple for the Bourbon connoisseur. It has been crafted to reflect the seasonal changes particular to Kentucky, having tones and a palate distinguishing both searing heat and bitter cold. Kept in white oak barrels, Jim Beam has produced a flavour that can only be described as pure Bourbon. Jim Beam distillery is now in its seventh
generation and 1795 is a celebration of the iconic brand. At 47.5% alcohol content, 1795 is stored deep in the Kentucky heartland, in a specially selected five-storey rack house. 1795 is a drink that only Jim Beam could perfect. The unique bottle features an attached cork design, a sleek smooth shape, and an embossed silver label – a stunning addition to the top shelf. The namesake – 1795 – spurs from Jim Beam’s origins, being the first year that the Beam family were involved in whiskey production. Jim Beam 1795 will be available at RRP$249. l
Design collaboration celebrates New Zealand Absolut Vodka continues to collaborate with cutting-edge visionaries from around the globe with the launch of Absolut NZ Limited Edition, an exclusive gift pack designed by Huffer. Over the past 30 years, the international premium vodka brand Absolut has collaborated with an array of the world’s top design and fashion icons including Andy Warhol, Tom Ford and Stella McCartney to create unique and innovative campaigns. Now it’s time for a New Zealand original, with the launch of Absolut NZ Limited Edition, a creative collaboration with iconic New Zealand fashion label Huffer. The unique gift pack design is an Absolut-first for New Zealand and represents Kiwi design heritage at its best. Featuring a contemporary silver map of New Zealand made up solely from Huffer’s signature three-dot logo, the black new release gift pack builds on the legendary Absolut history of creative package
FMCG july 2011
designs, many of which have become collectors’ items. “We’re beyond proud to be involved with this collaboration and to partner with an international brand such as Absolut,” says Huffer’s company director Steve Dunstan. “Absolut’s aesthetic and creativity have always appealed to us as a brand and to be able to create a New Zealand-first with them is a complete thrill.” Absolut was convinced from the outset that Huffer was the perfect fit for this campaign, with its design-led background based on inclusivity and functionality. “Huffer brings their energy, talent and innovation to the collaboration which showcases the bold and iconic personalities of Absolut and Huffer through this first-ever New Zealand limited edition gift pack,” says Luan Howitt, Absolut’s marketing manager. Absolut NZ Limited Edition gift pack (1L RRP $54.99), is available from leading liquor outlets in New Zealand from early July. l
In celebration of the campaign, a signature cocktail inspired by Huffer and Absolut’s mixologist Chris Harrop has been created – the aptly titled and coffee-hued Absolut Huffer. Absolut Huffer Designer Cocktail 30ml Absolut Original 20ml Kahlúa 30ml freshly brewed espresso 15ml maple syrup Dash of Fee Brothers bitters Stir all ingredients over ice and strain into a chilled cocktail glass. Garnish with three white chocolate buttons, arranged in the shape of the Huffer symbol.
Reserve range moves to regional appellation Jacob’s Creek will be moving to regional appellation on its Reserve range of wines from July 2011 across its key international markets. The new Jacob’s Creek Reserve offering will focus on three key wine regions being Barossa, Coonawarra and Adelaide Hills, and the new wines will reflect the distinct personality of each region through the chosen grape variety. In recent decades Australia has established a good reputation as a producer of quality wine built largely on the reliability achieved through careful blending from multiple regions across south eastern Australia. However, increasingly, certain regions within Australia are being noted for their success with certain grape varieties and styles. Bernard Hickin, chief winemaker for Jacob’s Creek, explains: “It is widely recognised that certain grape varieties are better suited to particular regions. “The Barossa, with its warm dry days and cool nights, is both ideal for rich Shiraz and from its upper ranges, delicate Riesling. In addition Coonawarra’s unique terrain and maritime climate grows great Cabernet Sauvignon, and the cool climate of the Adelaide Hills with its high altitude hills and valleys provides a variety of micro-climates that are perfect for producing crisp elegant contemporary styles of Chardonnay. “For many years we have created regional varietal wines under our premium heritage banner which has yielded great success. We are pleased to extend this regionality into our Reserve range.” The Jacob’s Creek Reserve range was launched in 2000 and then, as now, fruit for the Reserve wines is identified by the winemakers while still in the vineyard and set aside at harvest for its high quality and true varietal expression.
For the new regional Reserve wines, the same careful fruit selection will occur, but will be restricted to the named region which is best suited for growing that variety. In addition the winemakers will select fruit that also exhibits distinct regional characters. “The resultant wines strongly reflect the personality of the region and the variety Bernard Hickin, chief winemaker from which it comes,” says for Jacob’s Creek. Bernard Hickin. The new range of Reserve wines available in New Zealand from early July includes: • Jacob’s Creek Reserve Barossa Shiraz 2008 • Jacob’s Creek Reserve Barossa Riesling 2010 • Jacob’s Creek Reserve Coonawarra Cabernet Sauvignon 2009 • Jacob’s Creek Reserve Adelaide Hills Chardonnay 2009 Jacob’s Creek Reserve Barossa Merlot 2010 will be available from early October. Jacob’s Creek is one of Australia’s leading wine brands, offering quality contemporary Australian wine styles with great varietal expression. First launched in 1976 the wine brand is named after a creek that runs through the renowned Barossa Valley wine region in South Australia. Jacob’s Creek is made by Orlando Wines which was founded by Johann Gramp after he planted his first vines on the banks of Jacob’s Creek in 1847 to start a tradition of winemaking over 160 years ago. l
Win a Jacob’s Creek giftbox! Subscribe to FMCG this month to be in the draw to win a unique gift box of wines from the Jacob’s Creek Reserves range, worth over $100! The new Jacob’s Creek Reserve offering focuses on three key wine regions being Barossa, Coonawarra and Adelaide Hills, and the wines will reflect the distinct personality of each region through the chosen grape variety. Jacob’s Creek Regional Reserve wines will be available in the New Zealand market from early July. For more information go to www.jacobscreek.com.au. Drink Jacob’s Creek responsibly. You must be 18 years or over to enter. To subscribe turn to page 15, or visit www.fmcg.co.nz. july 2011 FMCG
New World Stonefields
sn a p now s s men
s Paul and James Beryl Fabian with their son Store owners Graham and n Avenue. Lun s nd’ the new store in Auckla at the official opening of
e f thes one o with ski t d e t t po ded or Expor who s rewar nders une were Export Dry la k c J Au 3, men in port 3 snow and an Ex s passe ck of beer. a Gold p
New join sports s Iro a n M am b a s s a dor iden s
– Deep South Ice s: Large manufacturers Cafe & Store. Supreme Award Winner ach Be na apu acturer – Tak Cream; Boutique Manuf
$130,000 in nd has invested over New World South Isla ators (AEDs) rill ated external defib purchasing 37 autom . for its supermarkets
Has your team been part of a charity event, opened a new factory, or dreamed up a colourful promotional activity? Send us your favourite photo and go in the draw to win a delicious Fair Trade gift hamper filled with chocolate, tea, coffee and other Fair Trade goodies worth $100! Just email your high res image with a caption and your contact details to: email@example.com
S a v i n g l i v e s k…e t s in supermar
11 Awa r ds 2 0 I c e C r e a ms t o w n in Queen
Top ath lete Nik ki the key s for a B Hamblin broug ht eef + La mb bran her dog along ded car to from ce receive o Rod S later.
DIARY 2011 july 9-10
GLUTEN FREE FOOD & ALLERGY SHOW
Wellington TSB Arena
Sydney Convention & Exhibition Centre
THE FOOD SHOW (AUCKLAND)
New Zealand based food show. ASB Showgrounds, Auckland
FINE FOOD AUSTRALIA
ASIA FRUIT LOGISTICA
SECOND ANNUAL AUSTRALASIAN FMCG SUMMIT
Hong Kong Convention and Exhibition Centre Hong Kong
Lunar Park, Sydney, Australia
In association with Foodstuffs Expo. Palmerston North
NEW ZEALAND INTERNATIONAL WINE SHOW 2011
Closing date for entries: 5 August Closing date for receipt of wine samples: 10 August Judging dates: 15-17 August
MASSEY UNIVERSITY FOOD AWARDS
THE GROCERY CHARITY BALL
The Langham, Auckland
ENVIRONMENTAL PACKAGING AWARDS
NEW ZEALAND INTERNATIONAL WINE SHOW AWARDS DINNER
FGC ANNUAL CONFERENCE
NZ JUICE & BEVERAGE AWARDS
GLUTEN FREE FOOD & ALLERGY SHOW
FINE FOOD INDIA
Pragati Maidan Exhibition Centre New Delhi, India
Crowne Plaza Hotel, Albert Street, Auckland
Is your event or trade fair featured here? If youâ€™d like to be included please email: firstname.lastname@example.org
Introducing the latest addition to the Cinderella Dried Fruit snacking range..... Cinderella Cranberries & Raisins Fruit Booster - 6 pack!
FMCG readers SAVE 15% off the price of registration for...
2nd Annual Australasian
12th â€“ 13th September 2011, Luna Park, Sydney
Smart collaboration strategies for driving profitability and business growth across the supply chain
Kate Carnell Chief Executive Officer Australian Food and Grocery Industry
Katherine Rich Chief Executive Officer NZ Food Grocery Council
Chris Foster Chairman & Regional CEO, Asia Pacific Saatchi & Saatchi
Phillip Lynch Managing Director Johnson & Johnson
2nd Annual Australasian
12th & 13th September 2011, Luna Park, Sydney
Graham Dugdale Paul Fisher Don Nicol Josh Frith Smart collaboration strategies for driving Executive General Manager Managing Director Chief Executive Officer Chief Executive Officer profitability and business growth across the supply chain Simplot Interactive Advertising Promax The Dubs Bureau
Exhibition and Sponsorship Opportunities Contact Jon Chivers T: +61 2 8908 8518 E: email@example.com
W: O N r e t s i Reg
REGISTER 3 AND SEND A 4TH FREE!
regi before ster 29 th Ju
ly SAVE 15% use p romo co FMCG de
T: +61 2 8908 8555 W: www.acevents.com.au/fmcg2011