In a series of 2022 webinars, interviews and presentations, Malcolm McAlpine, Channels Marketing - Branded Snacks and Confections at Mondelēz International, relied on compelling new data to identify key snacking trends and to teach operators to capitalize on what micro market consumers are now craving.
McAlpine has a favorite quote when it comes to identifying current market conditions in the snack industry. “If you aren’t talking with data, you are merely just another person with an opinion.” Throughout 2022, McAlpine provided operators with snack-related data and offered some step-by-step advice on how to turn that data into increased profitability.
Various studies cited by McAlpine explored the direction of micro markets, offering a revealing look at the changing mindset of the snacking consumer and how targeted promotions can have a positive impact on sales.
McAlpine cited the latest Automatic Merchandiser State of the Industry Report, which shows micro markets jumping back to 2019 levels and growing. According to the report:
Mondelēz International's Annual State of Snacking Report, developed in partnership with the Harris Poll, was used by McAlpine to help operators understand how consumers view snacking in the post-pandemic world, with emphasis on the workplace. He noted that the role of snacking continues to evolve with a trend toward balanced diets and a desire for indulgence and eating throughout the day. The report shows that:
McAlpine pointed to the Technomic Q3 2022 report, that reveals an emerging trend that has developed with convenience store customers due to pricing pressures, such as higher gas prices. “One in four consumers consider price to be an important factor when choosing a snack,” said McAlpine.
According to a study by Kanter Profiles/Mintel, collecting data from almost 2,000 consumers, all over 18 years old, the price of a snack is most important among millennials, with 33% choosing price as a key factor when making a snack purchase.
The Kanter study also revealed that about 40% of consumer snack purchases are unplanned. “With most snack purchases unplanned, it is important to get the consumer’s attention through promotions,” said McAlpine.
At his 2022 NAMA Show presentation, McAlpine stressed the importance of category management, (putting the right product in the right place at the right time, for the right demographic). “Promotion is the missing piece,” said McAlpine, who noted that the State of Snacking/Harris Poll report shows that consumers now expect promotions.
McAlpine offered four different ways for micro market operators to effectively promote products.
Bundling: Bundling involves an immediate discount with the purchase of a second product. “As an example, we have run bundling promotions successfully with BelVita and the purchase of a branded bottled water,” McAlpine said. “Not only are you giving the consumer an immediate discount, but you are giving them a reason to purchase a second product.”
Discounts: Dollars-off or cents-off programs also have a strong appeal with consumers, providing instant gratification. “When you are dealing with Gen Z and younger millennial consumers, immediate discounts work well because instant gratification appeals to them,” said McAlpine.
Loyalty Programs: Loyalty programs, which reward a consumer for consistent purchasing of the same product, tend to be more attractive to older millennials, Gen X and baby boomers. “Unlike Gen Z and the younger millennials, this older group is willing to wait to be rewarded by a program that offers ‘buy four, get one free,’” McAlpine said.
Cross-Channel Promotions: In a November Automatic Merchandiser webinar, McAlpine talked about cross-channel promotions, such as a movie theater discount, which are proving to have wide appeal. McAlpine said that a cross-channel program in San Antonio from late 2021, which tied a micro market purchase to movie theater discounts, resulted in a 155% sales increase on the promoted products. “We expect much more of this type of promotion in 2023,” he added.
McAlpine outlined several key takeaways for best practices for operators to consider, based on data that was accumulated from the industry studies noted above.
McAlpine urges operators to reach out to their Mondelēz International Sales Representative. “They will be happy to share the data with operators and help them use the data that is available,” he said. “Reaching out is the best way to get started on selecting products based on demographics and to implement promotions that will deliver measurable results.” You can learn about micro market trends as well as product promotions and loyalty programs in workplace environments at Mondelēz International’s insights channel.
Read about 6 Trends Changing and Challenging the Foodservice Status Quo in 2022.Read Article
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