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March 25, 2015

Consumers Sense Frugal Beauty in Imperfection

Daphne KasrielAnalyst Insight by Daphne Kasriel-Alexander - Consumer Trends Consultant

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The consumer desire to be thrifty, kick-started by the ‘Great Recession’, has not dissolved as the financial health of many consumers slowly improves. An interesting and growing trend sees the development of more real world and online brands meeting the consumer interest in substantial savings on essentials, whether this is  expressed via interest in ‘substandard’ just-past its sell-by date produce, “ugly food”,  or in welcoming  ‘pre-loved’ branded goods  resold by the company that originally made them, or by other consumers.

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March 24, 2015

Turning Around Sun Protection Growth with Added Benefits

Oru_MohiuddinAnalyst Insight by Oru Mohiuddin - Senior Beauty and Personal Care Analyst

The process of developing white spaces to drive growth in the beauty industry, particularly in mature countries challenged by the economic slowdown, increasingly involves incorporating claims from other categories in order to introduce new groups of products with added benefits. Sun protection is a claim increasingly used by products in categories other than sun care. Sun protection claims are most widely used for anti-agers but are also visible to a lesser extent in facial foundations. An interesting question is, with overlapping claims, how are these categories juxtaposed?

Sun protection in anti-agers and facial foundation impacts sun care in developed countries

The increasing incorporation of sun protection benefits in anti-ageing facial moisturisers and facial foundations is impacting growth for sun care as a separate category in developed countries. From 2012 to 2014, sun care growth declined from 3% annually to 1% annually, while anti-agers' growth slowed from just over 3% to 2.5%. Both product areas are seeing sales growth slow but sun care slowed at a faster rate in comparison to anti-agers. Sun care is finding it more difficult to cope with competition from anti-agers due to anti-agers offering both sun protection and more specialised anti-ageing solutions such as lifting, firming and regenerating. In contrast, the anti-ageing benefits offered by sun care primarily include protecting skin from sun damage, which in turn helps to delay the ageing process. Anti-ageing sun care thus focuses more on the preventive side rather than addressing consumers' current ageing concerns. In facial foundations, BB/CC creams meanwhile also claim to provide sun protection as part of a total skin care solution, thus offering convenience and a time- and money-saving option.

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E-Commerce in China Could Boom after New Zealand Infant Formula Poison Threat

Lianne van den BosAnalyst Insight by Lianne van den Bos - Food Analyst

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Over the last few years Internet retailing for baby food has soared in China after several baby food scares caused parents to turn to the online channel to order “trusted” European brands that were sold out in-store. One of the latest threats in New Zealand could boost Internet retailing even more.

photo online sales_small.jpg

New Zealand’s largest dairy producer, Fonterra, as well as Federated Farmers, are making efforts to reassure consumers that their products are safe after a blackmail threat was received to poison both companies’ infant formula. The letters threatened to contaminate infant formula with a poison known as 1080, used in pest control, as a protest to stop the country from using it. Biodegradable 1080 poison is the only toxin currently registered for use on mainland New Zealand as suitable for aerial targeting of possums - a major conservation and agricultural pest.

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March 23, 2015

Threat on New Zealand Dairy as 1080 Infant Formula Contamination Scare Revealed

Erika SirimanneInsight by Erika Sirimane - Business Development Consultant

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On March 10th 2015, the New Zealand Police and the Ministry for Primary Industries held a joint press conference to announce that Fonterra Co-operative Group Ltd and the Federated Farmers advocacy organisation received letters in November 2014 threatening to contaminate infant formula and other products if New Zealand did not stop using the pesticide 1080 by the end of March 2015. 1080, a pest control chemical compound commonly used by the Department of Conservation to control possum and rodent populations, represents a contentious issue in New Zealand, with the use often supported by conservationists and livestock farmers, but typically opposed by residents living in 1080 aerial-drop zones.

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Frugal Innovation: When Less is More and Simplicity Sells

Sarah-B-Banner

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Frugal innovation, or removing non-essential and often costly features from a product or service, can be a win-win for business – because it’s a process which is sustainable, cost-effective, and potentially very rewarding in terms of extending reach to new consumers. At its heart, frugal innovation is about focusing on customers, observing their core needs and designing products, services and business models that meet these needs.

Not just for emerging market consumers

In the past, frugal innovation has been seen as an idea for emerging market consumers and indeed many impressive ideas have come out of emerging and developing countries.

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March 22, 2015

A Bittersweet Future for Sugar Consumption in Packaged Food

Jack SkellyAnalyst Insight by Jack Skelly - Research Analyst

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At the start of the last century, most people worried whether they’d be able to put food on their plate: today, they’re more concerned about whether their plate has too much food. Almost every day, there are cautionary tales regarding the health risks of consuming excessive calories, fat or sugar. A modern-day version of Oliver Twist would likely be clinically obese rather than going hungry.

In Western Europe and North America, there is subsequently more pressure on soft drink and confectionery manufacturers to act responsibly. In the UK and US, there has been much effort by companies to reformulate their products, with Mars, Mondelez and Nestlé all aiming to reduce the calorie content within their countlines. As data from Euromonitor International’s Nutrition research demonstrates, many chocolate bars sold in the UK now meet a voluntary target of less than 250 calories per pack. However, will continuing concerns regarding sugar consumption affect sales?

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March 21, 2015

Eggs: The New Favourite Protein

Simone_BarokeAnalyst Insight by Simone Baroke - Contributing Analyst

Eggs are very much on the menu. In the US, their dynamism not only puts dwindling fresh meat sales to shame, but it seems that protein-packed eggs are turning into a threat for carbohydrate-based breakfast cereal. As eggs shed their high-cholesterol stigma, sales will increasingly be fuelled by rising demand from mature consumers, providing excellent long-term growth prospects.

Eggs beat meat

Consumers who love protein love eggs, and they certainly have a lot to offer. Eggs are tasty, nutritious, versatile and relatively cheap. Plus, frying one up does not require an advanced master class in haute cuisine.

The high-protein trend originated in the US, where eggs are benefitting from consumers searching out alternatives to meat. As growing numbers of people tune into environmental and health issues, they start to realise that their meat consumption is already on the high side, and that meat for breakfast, lunch and dinner is not the way forward.

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New Chapter for Appliances Industry: Smart Appliances

Jamie_KoAnalyst Insight by Jamie Ko - Head of Consumer Appliances

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A scenario where you can control your refrigerator, washing machine and air conditioner via your laptop, tablet or smartphone appears likely to become a reality in the short-term future. In response to explosive growth in the number of global internet users, appliances manufacturers’ product development is increasingly aligned with mobile connectivity and apps. This is an inevitable evolution, as the industry is considered to be mature in terms of technological application and product penetration in comparison to product areas such as smartphones or tablets. As leading manufacturers vigorously invest in boosting the commercialising of smart applications, it is only a matter of time before smart appliances become mainstream for consumers.

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March 20, 2015

Premiumisation Takes Spirits to a New Level in Australia

Daniel GrimseyAnalyst Insight by Daniel  Grimsey - Senior Research Analyst

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Given all the hype around premiumisation, there’s nothing ground-breaking in assuming that premiumisation will prove a defining trend of 2015. But why are consumers trading-up?

Australian aspirations

People are always talking about premiumisation, but nobody really talks about why.

Firstly, we need to look at how we got here.  We need to understand that Australia is not like other countries.  For many observers, the fact that we can even talk about a trend like premiumisation in Australia doesn’t feel right – after all this is a nation in which spirit-based RTDs outsell full-strength bottled spirits by a mind-boggling margin.

Australians drank 269 million litres of spirit-based RTDs in 2013, compared to only 63 million litres of spirits.  This is quite unique.  In the United States, for example, 45 million litres of spirit-based RTDs and 1.8 billion litres of spirits were consumed in 2013.  And the rest of the world resembles the US far more than it does Australia.

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March 19, 2015

Chai: The Indulgent Value Driver in US Tea

Howard TelfordAnalyst Insight by Howard Telford - Senior Beverages Analyst

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Slowly, but surely, the tea category in the US continues to grow in value terms, even as consumption plateaued in the last year. Retail volume sales of tea in the US were flat in 2014, while value sales increased by 3%. The strong performance of higher priced black specialty tea and the shift towards premium fruit/herbal and green tea brands sustained positive growth despite a failure to increase overall retail tea volumes with US consumers. The mainstream, mass-market appeal of high-end tea remains unclear.

Starbucks – through both its Tazo brand of tea concentrates and through its upscale Teavana café chains and brand – has placed a great deal of focus on ‘chai’ flavour in recent product development. Chai tea – at least as defined by North American consumers – still represents a versatile avenue of value growth in the retail tea segment, particularly for those consumers seeking an indulgent, convenient and full-flavour hot beverage. Brands seeking opportunities in chai tea must focus on flavour and the single-serve product format in chai beverages in order to realize its mass appeal.   

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