LETTUCE REGULAR ANALYSIS YEAR TO 21/02/2015

Copyright ©2012 The Nielsen Company. Confidential and proprietary Market Overview 2. Demographics 3. Retail Health Situation by State Agenda This analysis is part of a vegetable consumer purchase data project funded by HIA using the vegetable levy and matched funds from the Australian Government. This report captures only Fresh Vegetables and excludes processed vegetables (e.g. Fresh Sweet Corn excluding Canned Sweet Corn; Fresh Beans excluding Canned Beans).

Copyright ©2013 The Nielsen Company. Confidential and proprietary. 3 Data Source – Nielsen Homescan Market – Total Australia – States of Australia – Retailers Analysis Measure – Value – Volume Periods – Last Year : 52 weeks To 22/02/2014 – This Year :52 weeks To 21/02/2015 ANALYSIS PARAMETERS RESEARCH METHODOLOGY NIELSEN HOMESCAN A Panel of 10,000 Australian households Demographically and geographically representative Households electronically record their household purchases of all take-home grocery goods (fresh and packaged)

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 4 HIGHLIGHTS RECOMMENDATIONS Performance improvement may come from recouping a dwindling buyer base. Understand why some household groups are not buying Lettuce this year. Greatest contraction in Lettuce buying households is evident among Young Transitionals, Independent Singles, and Senior Couples. Are they preferring to eat Lettuce as part of salads therefore purchasing them out of the home or in pre-prepared formats? Lettuce is not performing well in terms of Volume sales across all retailers. Understand if demand is shifting to meal-ready formats like salad mixes or sandwich packs? Coles is especially disadvantaged from a conversion perspective. Investigate status of quality, freshness, or supply consistency to bridge the gap with Woolworths. Colmar Brunton (Wave Nov ‘14) cites “health” as one of the key reasons for Lettuce consumption. New research has emerged around the health benefits of Lettuce in protecting people from hypertension*. This angle can be explored from a marketing perspective to regain consumer engagement for the vegetable. * Lettuce represents 1.2% of volume and 4.7% value market share. Its buyer base has reduced along with a decline in annual consumption and average $ spend. Senior Couples and Bustling Families are important for Lettuce; they account for more volume share than their share of buyers. Senior Couples are the only group to have increased their purchase frequency this year. Larger households (3 or more members) are key buyers for Lettuce, accounting for half of its volume sales while representing only 44% buyers. Volume sales declined across all retailers except Coles, driving the decline for Lettuce. Coles, Woolworths and IGA lost significant value sales this year, contributing to the drop in value sales for Lettuce. 64% of Woolworths shoppers who buy Lettuce, prefer to purchase it at Woolworths stores, whereas the corresponding conversion rate is just about 59% for Coles. VIC, accounts for a quarter of total $ spend on Lettuce, and have witnessed maximum buyer contraction amongst all Australian states.

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 5 Copyright © 2014 The Nielsen Company. Confidential and proprietary. Market Overview Lettuce

Copyright ©2014 The Nielsen Company. Confidential and proprietary. 6 Share of Market Volume Total Vegetables Australia Share of Market Value Total Vegetables Australia Market share of Lettuce has gone down this year, reaching 1.2% of volume and 4.7% of value market share. Source: Nielsen Homescan

Copyright ©2014 The Nielsen Company. Confidential and proprietary. 7 How many Households buy annually? How much (Kg) do they buy per year? How much ($) do they spend per year? This Year Last year Source: Nielsen Homescan Lettuce witnessed buyer leakage of 87,927 households this year, with a corresponding drop in their average annual $ spend and consumption.

Copyright ©2014 The Nielsen Company. Confidential and proprietary. 8 How much ($) do they spend per occasion? How much (Kg) do they buy per occasion? How often do they buy annually? Source: Nielsen Homescan The drop in average spend is due to a decline in the purchase frequency this year. This Year Last year

Copyright ©2014 The Nielsen Company. Confidential and proprietary. 9 Source: Nielsen Homescan Post the seasonal peak of January, household reach in February is lower this year as compared to last year. Kg

Copyright ©2014 The Nielsen Company. Confidential and proprietary. 10 Source: Nielsen Homescan The average monthly spend on Lettuce is growing steadily since October and has reached a 2-year high in Feb ‘15.

Copyright ©2014 The Nielsen Company. Confidential and proprietary. 11 Source: Nielsen Homescan The growth in average spend is a result of rise in the $ spend on Lettuce in each trip, this month compared to same period year ago.

Copyright ©2014 The Nielsen Company. Confidential and proprietary. 12 Demographics Lettuce

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 13 Copyright © 2014 The Nielsen Company. Confidential and proprietary. LIFESTAGE SENIOR COUPLES | 2 or more adults 60+ (18.0% of population) ESTABLISHED COUPLES | 2 or more adults (22.5% of population) INDEPENDENT SINGLES | 1 adult >35 with no children (21.0% of population) YOUNG TRANSITIONALS | Adults <35 with no children (8.6% of population) BUSTLING FAMILIES | Oldest Child (13.6% of population) SMALL SCALE FAMILIES | Oldest Child 6-12 (9.7% of population) START UP FAMILIES | Oldest Child <6 (6.6% of population) HOUSEHOLD SIZE 1-2 MEMBER HOUSEHOLDS (58.8% of population) 3 MEMBER HOUSEHOLDS (15.9% of population) 4 MEMBER HOUSEHOLDS (15.6% of population) 5+ MEMBER HOUSEHOLDS (9.8% of population) View your consumers according to…

Copyright ©2014 The Nielsen Company. Confidential and proprietary. 14 Source: Nielsen Homescan Distribution of Buyers Australia Distribution of Volume Australia Senior Couples and Bustling Families are heavy consumers of Lettuce as they account for more volume sales than their buyer share. Senior Couples increased their volume consumption this year.

Copyright ©2014 The Nielsen Company. Confidential and proprietary. 15 How many Households buy annually? Note: The difference in the bar heights for same data labels is due to the difference in decimal points. The data has been rounded up to one decimal point. Source: Nielsen Homescan How often do they buy annually? How much (Kg) do they buy per occasion? Gains in Bustling Family & Established Couple households could not offset the buyer contraction witnessed by other groups. Senior Couples are the only group to have increased their purchase frequency this year. This Year Last year

Copyright ©2014 The Nielsen Company. Confidential and proprietary. 16 Source: Nielsen Homescan Distribution of Buyers Australia Distribution of Volume Australia Larger households (3 or more members) are the key buyers for Lettuce as they account for half of volume sales while representing 44% of buyer base.

Copyright ©2014 The Nielsen Company. Confidential and proprietary. 17 How many Households buy annually? How often do they buy annually? How much (Kg) do they buy per occasion? Smaller households (1-2 members) witnessed the greatest loss of 69,977 buying households. This Year Last year Note: The difference in the bar heights for same data labels is due to the difference in decimal points. The data has been rounded up to one decimal point. Source: Nielsen Homescan

Copyright ©2012 The Nielsen Company. Confidential and proprietary. 18 Copyright © 2014 The Nielsen Company. Confidential and proprietary. Retail Health Situation by State Lettuce

Copyright ©2014 The Nielsen Company. Confidential and proprietary. 19 Share by Retailers This Year Lettuce Sales vs. Last Year This year vs. Last year Lettuce Other Supermarkets Non Supermarkets Volume Value Lettuce declined by -6% in volume sales driven by losses across all retailers, except Coles where it was flat. Coles, Woolworths and IGA drove the decline in terms of value sales. Source: Nielsen Homescan

Copyright ©2014 The Nielsen Company. Confidential and proprietary. 20 Other Supermarkets Non Supermarkets Drivers of Account Growth & Decline Year to 21/02/2015 vs Year Ago (YA) The value growth in Aldi is driven by rise in the average spend on Lettuce in every trip. The decline in Coles, Woolworths and IGA is mainly due to a drop in number of buying households and their trips.

Copyright ©2014 The Nielsen Company. Confidential and proprietary. 21 Source: Nielsen Homescan Just over 64% of Woolworths shoppers are purchasing Lettuce on their shopping trips to Woolworths. This rate fairs well compared to other comparable vegetables but has room to improve relative to Tomatoes & Fresh Salad. Account Shopper Conversion Year to 21/02/2015| Woolworths (WW)

Copyright ©2014 The Nielsen Company. Confidential and proprietary. 22 Source: Nielsen Homescan Conversion rate for Coles is almost 5 percentage points lower than Woolworths’, with just about 59% of shoppers buying Lettuce in this retailer. Account Shopper Conversion Year to 21/02/2015| Coles

Copyright ©2014 The Nielsen Company. Confidential and proprietary. 23 SA + NT (9%) VIC (25%) NSW (32%) QLD (22%) WA (9%) Average KG per Buyer Penetration this year vs. last year ( ) State share of Lettuce $ sales consumption Is there a particular State driving the category performance? Source: Nielsen Homescan Consumption has declined across all Australian states except QLD and VIC. QLD is the only state to have added Lettuce buying households, whereas, VIC, accounting for a quarter of total Lettuce value sales, witnessed the greatest buyer leakage.

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