© IGD 2010 Michael Freedman, Senior Consumer Analyst, 13 May 2010

© IGD 2010 Over 700 members from across the international supply chain, including farming At the heart of the industry for 100 years Total supply chain perspective In-house team of 100 – Over 30 analysts with relevant industry experience Well connected – Board and operational level links throughout the chain – Reliable source for government departments and MPC – Strong engagement with leading think tanks Funding – 20% Subscriptions, 80% Trading company Who we are

© IGD 2010 Supporting farmers and small businesses IGD is proud to support UK farmers and small food businesses We provide a series of free shopper trend reports on key commodities – Lamb – Potatoes – Beef We have trained hundreds of farmers on shopper trends and consumer marketing Fully funded ‘Centenary Scholarships’ to our postgraduate course for many small food businesses in 2009/10

© IGD 2010 An introduction to Shopper Insight from IGD Proprietary research programme to provide a landscape perspective of shopper behaviour – Plus client-specific, customised projects for a ‘deep dive’ Primary GB shopper research methodology – Mixture of both qualitative and quantitative research – Feedback from 1,000+ GB shoppers, including accompanied shopper trips, depth interviews, focus groups and national surveys All research undertaken by IGD in-house team – Our consumer analysts also conduct the primary research, to provide the highest quality insight

© IGD 2010 Source: ONS, December Shows measure IHYQ 5 consecutive quarters of economic contraction. Recession is severe - a sudden downturn Deep economic contraction

© IGD 2010 Impact of the recession on shopping behaviour Changed for good - made changes and will stick with them Changed for now - expect to go back to normal Expect to cut back if it gets worse As normal and don’t expect to change 77% of those who have made changes expect to stick with them +8% -5% Source: IGD Consumer Unit

© IGD expectations – careful without compromise Source: IGD Consumer Unit Price of food Approach to shopping Quality of food

© IGD 2010 Shoppers are even more focussed on price Source: IGD Consumer Unit Store choice Product choiceImprovements 1.Price 2.Layout 3.Accessible 4.Parking 1.Price 2.Ingredients 3.Fat content 4.Brand 1.Price 2.Local foods 3.Promotions 4.Farm shops/mrkts +11%

© IGD 2010 Increased promotional activity

© IGD 2010 Want multi-buys on everything Want multi-buys only on fresh not on ambient products Want multi-buys on ambient but not fresh products Don’t like multi-buys at all Don't know Split opinion on fresh food multi-buys Source: IGD Consumer Unit Yes 54% BUY ONE GET ONE FREE No 40%

© IGD 2010 A focus on reducing food waste I used to go shopping once a week and buy fruit and veg on offers and throw half of it away. We now shop more frequently and buy less on each trip.. I have always been conscious of waste. Multi- buys on fresh produce are not ideal unless you are a big family. Sheffield, Post family, C2D Sheffield, With young children, C2D Source: IGD Consumer Unit

© IGD 2010 Shoppers are looking for value and values ValueValues Heritage Provenance Pack size Ethics Sustainability Performance Promotions Price

© IGD 2010 Waitrose – focus on sustainability Source:

© IGD 2010 ‘Ethical’ products bought in the last month Locally producedFairtrade High animal welfare Organic Environmentally friendly* Source: IGD Consumer Unit %

© IGD 2010 What are shoppers prepared to pay a bit extra for? High quality ingredients Free rangeLocally producedFairtrade Source: IGD Consumer Unit

© IGD 2010 Local or regional foods Foods with high animal welfare claims Fairtrade foods Organic foods These trends are expected to accelerate by 2012 Source: IGD Consumer Unit

© IGD 2010 Shoppers would like more local food Source: IGD Consumer Unit No price increases for the food I buy More locally produced foods available in the supermarket More special price promotions available in the store A farmers’ market or farm shop in the area More discount stores in the area Improvements shoppers want to see:

© IGD 2010 Source: IGD Consumer Unit Important to identify local food shoppers Uncommitted Non local 3% Choosers Activists Don’t know

© IGD 2010 Opportunities for local fruit and vegetable growth Source: IGD Consumer Unit

© IGD 2010 Meeting different shopper needs for more local food Source: IGD Consumer Unit Aged 25+ (15%) Choosers (17%) With children aged (21%) East Anglia (26%) Local fruit Aged (23%) Choosers (21%)) Yorkshire & Humberside (22%) Scotland (23%) Local vegetables

© IGD 2010 Promote the key benefits of local food Source: IGD Consumer Unit Support local producersSupport local retailersKeeps jobs in this area

© IGD 2010 Personalising the impact

© IGD 2010 Provenance: reinforce local sourcing credentials

© IGD 2010 Overlap between working conditions and local sourcing 63% It is more important to use British suppliers 69% It is more important for companies to provide good pay and conditions to workers in poorer nations 10% 53% 16% Source: IGD Consumer Unit

© IGD 2010 Local food is about juggling priorities Price Animal welfare Organic Seasonality Year round availability Quality Freshness Source: IGD Consumer Unit

© IGD 2010 A fine balance on whether to buy in season Year round availability Got used to it Convenience Healthy diet New products Ignorance Buying in season Environmental concern Better taste More natural Costs less Source: IGD Consumer Unit

© IGD 2010 A fine balance on whether to buy in season Year round availability Got used to it Convenience Healthy diet New products Ignorance Buying in season Environmental concern Better taste More natural Costs less Source: IGD Consumer Unit

© IGD 2010 What does the future hold?

© IGD 2010 Implications Appetite for more locally produced food remains strong Understand your shoppers Reinforce importance of supporting local economy Focus on ‘value’ and ‘values’ Make choices easier

© IGD 2010 Thank you Michael Freedman Senior Consumer Analyst, IGD +44 (0)