Organic & Free From Consumer Trends & Wild Harvest National Sales Expo 2018
Today s Presenters... Bekah Swan Vice President SUPERVALU, Private Brands Brian Kroening Regulatory Manager SUPERVALU, Private Brands Jenny Leckie Business Consultant SPINS 2
Agenda 2018 Natural Food Trends: Innovation & Beyond Consumer Purchase Trends & Insights Wild Harvest: Updates from the Brand Q&A 3
SIPPING ON INNOVATION: FUNCTIONAL BEV The trend that began with kombucha and drinking vinegars has expanded into Jun kombucha, kombucha beer, and a total overhaul of teas, energy drinks, and sports drinks. $29.7M ANNUAL MARKET +43.3% GROWTH IN RF FUNCTIONAL BEV SPINSscan Conventional Food Channel, Total US, RF Functional Beverages, TPL 52 weeks ending 5.20.18.
TEA TIME Tea drinks fit perfectly into evolving consumer preferences for the benefits of functional ingredients and full flavor with less or no sugar. In addition to drinks made from traditional tea (camellia sinensis), numerous alternative infusions showcased innovative ingredient bases. Ready-to-Drink (RTD) Packaged Tea IGZU is the first RTD bamboo leaf tea, offering more than 35mg of silica, a plant-based alternative to collagen. Rooting For You steeps burdock root in combination with chicory, dandelion, and ginger for buttery, nutty flavors and prebiotic fiber. Well established in the supplement space, Reserveage delivers collagen in a surprising format: individual tea bags. The new BeauTea line includes white tea across the board and hibiscus and lemon flavors in two additional SKUs.
CLEAN ENERGY Clean-label formulations are revamping the energy-drink set, replacing artificial ingredients with natural alternatives and botanical boosts. Naturewise blends tea (black or white tea, guayusa, matcha, rooibos) with adaptogenic ashwagandha, green coffee beans, fruit juice, and monk fruit. MATI s guayusa energy drinks are sweetened with fruit juice and accommodate varying palates. Three of six flavors have 9g of sugar and 40 calories per 12oz can, and the others have 18-19g and 90 calories.
THE NEW FACES OF NATURAL SPORTS DRINKS Artificial colors, flavors, and sweeteners are on notice: new natural performance drinks are making a play for shelf space. Fresh from The Maple Guild, new Tapt hydration and performance beverages contain maple-tree water with B-vitamins, electrolytes, and minerals. NOOMA s Organic Electrolyte Drinks include concentrated coconut water, a blend of fruit juices and stevia for flavor and sweetness, and sea salt.
ADAPTOGENS Offering balance and resistance to stress, adaptogens have expanded beyond supplementation and functional beverages into cereals, candy, tea and coffee. Within the Total US Conventional Food Channel, adaptogens are trending the strongest within Refrigerated Juices & Functional Beverages (+114%) and Shelf Stable RTD Tea & Coffee (+162%). TRENDING ADAPTOGENS WITHIN CONVENTIONAL FOOD CHANNEL +38% ASHWAGANDA +43% CHAGA +74% CORDYCEPS +98% REISHI 176% SHIITAKE SPINSscan Conventional Food Channels, Total US TPL, 52 weeks end 5.20.18.
DEMANDING TRANSPARENCY: HBC While the Body Care department as a whole is flatlining ($7.9B, +1.0%), natural alternatives are the powerhouse of growth, up 13.7% from last year. These products are delivering higher standards and more transparency against their conventional counterparts. Industry standards now include ingredient listings free from parabens, a class of preservatives that disrupts hormones and may contribute to cancer, and sulfates, aggressive detergents that strip natural oils from hair and skin, as well as cause irritation. +14.1% PARABEN FREE GROWTH +17.3% SULFATE FREE GROWTH SPINSscan Conventional Food Channel, Total US, Body Care Dept, TPL, NPI 52wks end 5.20.18.
Wild Harvest......an introduction to our brand and some updates 10
Organic Purchases: Household Penetration Nielsen Homescan Panel Data. % of HHs who have purchased Organic in the last year. 52 weeks ending 3/24/18. Total Store, All Outlets. 11
Organics Purchases: Income Level High and mid income HHs spend more on organic products yet 79% of low income HHs purchase organic products Low income HHs increased organic spend by $9.63 vs. last year Organic Penetration Organic $ per Household 87% 79% 87% 92% $105 $62 $88 $141 Total Low Income <$40K Middle Income High Income $70K+ +3.9% -1.5% +.8% +9.6% Total Low Income <$40K Middle Income High Income $70K+ +$11.02 +$9.63 +$7.77 +$9.54 Nielsen Homescan Panel Data. 52 weeks ending 3/24/18. Total Store, All Outlets. 12
Organic Purchases: Private Brand Share Private Brands represents ~30% dollar share of all organic sales Consumers trust the quality and authenticity of private brands in organic categories Private Brands captures 10% more than fair share of organic sales Source: The Power of Private Brands, IRI 2017. 13
Free From Consumers are paying more attention to what is in their food 71% of US consumers think there are probably more harmful or excess ingredients in foods than manufacturers tell us 69% of US consumers want to see more transparency in food product ingredients 59% of US consumer believe that the fewer ingredients a product has, the more healthful it is Source: Mintel GNPD, Mintel Reports Free From Foods - Oct 2017 US. 14
Non-GMO Consumers continue to be wary of genetically modified organisms (GMOs) seeking out non-gmo logos on pack Non-GMO claims have grown nearly 51% in US food and beverage categories since 2015 Non-GMO claims are most prevalent in snack, cereal & energy bars, juice, cold cereal, fruit snacks & cookie categories Source: Mintel GNPD, Mintel Reports Free From Foods - Oct 2017 US. 15
Labeled vs. Certified Non GMO Lack of government oversight with certification has triggered a shift in the increase in label claims. Certified Non-GMO Project Verified $12.9B ANNUAL MARKET +0.0% GROWTH OVER PREVIOUS YEAR Labeled Non-GMO Product Claim $16.1B ANNUAL MARKET +5.4% GROWTH OVER PREVIOUS YEAR Source: SPINSscan Conventional Food Channel, Total US TPL 52 weeks ending 5.20.18. 16
Our Response to Non-GMO In response to consumers seeking non-gmo product we have developed a non-gmo logo used in conjunction with the USDA Certified Organic logo 17
Our Brand Hundreds of organic and free-from items aligned with consumer trends Over 700 free-from, organic, and gluten free items across 80 categories Nearly 70% of products are certified USDA organic Simple, wholesome ingredients Award-winning products and packaging 18
Commitment to Quality We take great care in selecting suppliers that meet our standards for uncompromising quality, food safety, and operational excellence All suppliers are GFSI certified Import compliance for foreign suppliers Claim verification forms for any product claims requiring substantiation Our ingredient lists are reviewed consistently and updated quarterly Food: free from over 140 undesirable ingredients Household Chemicals: free from over 100 undesirable ingredients Personal Care: free from over 385 undesirable ingredients 19
Our Guarantee All products are rigorously tested to ensure the highest quality. We stand behind every product with our 100% quality guarantee. If a customer is not completely satisfied, we offer a full refund. Simply call the number on package to speak with a customer service representative. It s that easy! 20
Sales Drivers Strong sales and profit growth trend across the brand Core items in grocery, dairy, frozen, produce, meat Tertiary items to support brand equity Your Never Out list 21
New! Exact Weight Beef available NOW Our beef items are now exact weight to improve price perception, allow for better execution of promotions, and reduce labor in store 100% grass fed organic beef - No antibiotics or added hormones - Certified organic diet, pasture raised - Product of USA and Uruguay - Certain cuts USDA Certified Tender All Natural beef - No antibiotics or added hormones - Vegetarian fed - Angus breed - Certain cuts USDA Certified Tender 22
Innovation Over 80 new Wild Harvest items will launch in 2018! 23
Food grade formulations are free from over 385 ingredients including parabens, sulfates, synthetic fragrances and colors. Product development determined by Mintel and Nielsen consumer data, supplier insights, competitive research. Marketing support Assortment (~30 items) - Bar soaps, body wash - Bath bombs, salts, scrubs - Body lotion - Shampoo, conditioners - Hand soap Available October 2018 24
Sales Driving Tactics We ve seen these tactics drive incremental Wild Harvest sales and grow total category sales and profitability...learn more at our booth. Close key assortment voids (top void reports) Regular placement in ads Participate in SVU company-wide promo events Effective pricing strategy - 25% above equivalent conventional brand - 10% below comparable natural/organic brand Utilize POS kits and SVU digital assets Order and execute display vehicles 25
Sales Driving Tactics January: Healthy Living April: Earth Day Key Promotional Timeframes Don t miss our January promotional event... Last year s event was our biggest ever with sales increases +13% Aggressive merchandising and promotional activity Drove trial and repeat with sales gains sustained 6 months post event August: Back to School Sept/Oct: Fall 26
The January Jump The focus on health during the resolutions month of January is an easy win at retail. Over the last three years, the sales of natural products in conventional retailers during January has grown +30.1%, reaching a height of $2.6B. While supplements are a dietary staple during this time, comfort categories have begun to lead innovation in terms of products that help keep dieters on track: think high protein, low carb ice cream. Top Dollar NPI Categories in Jan 2018 Produce $221MM RF Yogurt & Kefir $176MM Shelf Stable Chips, Pretzels, Snacks $107MM RF Eggs $104MM Top Trending* NPI Categories in Jan 2018 Frozen Desserts Bread and Baked Goods Frozen Entrees Shelf Stable Soup +21.3% +11.7% +12.7% +15.4% *Dollar sales growth of categories over $60MM Source: SPINSscan Conventional Food Channel, Total US NPI 52 weeks ending 5.20.18; 4 weeks ending 1.28.18. 27
Refreshed Marketing Campaign We do our research to understand consumer attitudes, perceptions, shopping habits, and preferences to drive the strategy and direction of our brands. Wild Harvest new campaign - Taglines, messaging, in-store signage concepts tested - Final design resonated extremely well with Millennial consumers - Full of Good, Free from Bad - Creative is whimsical and playful 28
Marketing Support Web & Social Media Thematic Ad Templates* Digital Coupons In-Store POS Sign Kits In-Store Radio Scripts Assets available if retailer has access to SUPERVALU Digital Asset Manager (DAM). 29
In Store POS & Display Vehicles In-store POS kits available at no cost Reach out to your Sales contact to order English and Spanish versions Salty snack rack 55 rack Dump bins Freezer Cling Blade Signs Shelf Talkers Window Cling Ironman 30
Meeting in a Box Launch Kit Tool kit designed to launch or refresh Wild Harvest with store teams Educate, create excitement and brand ambassadors Welcome packet, coupons, easel sign, break room poster and more English and Spanish versions 31
Questions? For more visit us at the Private Brands Booth Kellogg street level & the Rotunda Thank You! 32
FREE FROM 140+ UNDESIRABLE INGREDIENTS rom Free f rom Free f 140+ 140+ PRODUCE MEAT rom Free f 100+ GROCERY DAIRY FROZEN BEVERAGE PET BABY PAPER CLEANING 50 LET S MEET THE BRAND OVERVIEW Meet the needs of your free-from and organic shopper with Wild Harvest. With over 700 items free from over 140 undesirable ingredients, Wild Harvest offers a complete breadth of reasons to grow profits and customer loyalty in a competitive market. TOP CATEGORIES BY UNITS SOLD PRODUCE & PACKAGED SALADS CANNED BEANS BEEF TOP TOP CATEGORIES BY DOLLARS SOLD PRODUCE & PACKAGED SALADS 60+ USDA Certified Organic items available Wide variety of pre-washed packaged salads NEW! Apple program launching this Fall SALTY SNACKS 20+ USDA Certified Organic and free-from items Free from artificial colors, flavors, and partially hydrogenated oils Non-GMO ingredients BEEF Angus cattle raised with no added hormones or antibiotics USDA choice or higher; USDA certified tender PET FOOD & TREATS Simple, wholesome ingredients made from high quality proteins, whole grains, vegetables and fruit Premium Dry Dog Food showing double digit growth vs. LY in total in xaoc Get the full list on the back!
WILD HARVEST DEPARTMENT ITEM UPC SVU ITEM CODE DESCRIPTION PK SIZE SALES RANK Eggs Dairy 71153550077 7679658 Cage Free Grade A Brown Eggs 15 12 ct 1 Eggs Dairy 71153550076 7679675 Organic Grade A Brown Eggs 15 12 ct 2 Milk Dairy 71153550070 7679676 / 7566719 Organic 2% Milk 6 64 oz 3 Milk Dairy 71153550067 7679679 / 7566706 Organic Whole Milk 6 64 oz 4 Package Salads Produce 71153550206 6484133 Organic Baby Spinach 6 5 oz 5 Vegetables Produce 71153550201 6486975 Organic Romaine Hearts 12 3 ct 6 Milk Dairy 71153550069 7679677 / 7566702 Organic 1% Milk 6 64 oz 7 Milk Dairy 71153550068 7679678 / 7566703 Organic Skim Milk 6 64 oz 8 Herbs Produce 71153550322 6486503 Organic Basil 3.75 oz 9 Package Salads Produce 71153550208 6484130 Organic Spring Mix 6 5 oz 10 Butter Dairy 71153550308 7582131 / 7582124 Organic Butter Salted 18 16 oz 11 Milk Dairy 71153550071 7679684 / 7566698 Organic Whole Milk 4 128 oz 12 Milk Dairy 71153550074 7566704 / 7566707 Organic 2% Milk 4 128 oz 13 Package Salads Produce 71153550205 6484139 Organic Baby Spinach 6 16 oz 14 Ground Beef Meat 71153550686 6520303 91% Ground Beef 12 1 lb 15 Ground Beef Meat 71153550907 6710259 Grass Fed Organic 85% Ground Beef 12 1 lb 16 Butter Dairy 71153550309 7582128 / 7582125 Organic Butter Unsalted 18 16 oz 17 Package Salad Produce 71153550196 6484131 Organic Greens/Sprinach 6 5 oz 18 Vegetables Produce 71153550192 6484979 Organic Baby Peeled Carrots 24 16 oz 19 Vegetables Produce 1153550193 6489407 Organic Grape Tomatoes 12 1 pt 20 Ground Beef Meat 71153550908 6710258 Grass Fed Organic 90% Ground Beef 12 1 lb 21 Package Salad Produce 71153550209 6484140 Organic Spring Mix 6 16 oz 22 Drinks Produce 71153550523 6074160 100% Coconut Water 24 8 oz 23 Center Store Grocery 71153550075 4148644 / 4500304 Organic 100% Maple Syrup 12 12 oz 24 Center Store Grocery 1153550195 4148580 Organic Honey Bear 12 12 oz 25 Center Store Grocery 71153550213 4148812 Organic Extra Virgin Olive Oil 12 17 oz 26 Dog Food Pet 71153550956 4020535 Salmon, Potato, Blueberry Dog Food 1 12 lb 27 Package Salads Produce 71153550197 6484132 Organic Arugula 6 5 oz 28 Center Store Grocery 71153551158 3812776 Organic Peanut Butter Creamy 12 16 oz 29 Ground Beef Meat 71153550685 6520302 80% Ground Beef 12 1 lb 30 Vegetables Produce 71153550440 6484141 Organic Greens/Spinach 6 16 oz 31 Eggs Dairy 71153550680 7604137 Cage Free Grade A Brown Eggs 10 18 ct 32 Center Store Grocery 71153550905 4500303 Organic 100% Maple Syrup 6 32 oz 33 Center Store Grocery 71153550289 4148813 / 4469267 Organic Low Sodium Chicken Broth 12 32 oz 34 Center Store Grocery 71153550741 3815474 Almond Butter 12 12 oz 35 Milk Dairy 71153550073 7566705 / 7566718 Organic 1% Milk 4 128 oz 36 Milk Dairy 71153550072 7679685 / 7566720 Organic Skim Milk 4 128 oz 37 Center Store Grocery 71153550288 4149253 / 4469266 Organic Chicken Broth 12 32 oz 38 Package Salads Produce 71153550508 6484124 Organic Power Greens 6 5 oz 39 Center Store Grocery 71153550532 4280484 Organic Coconut Oil 12 14 oz 40 Fruit Frozen 71153550585 7090036 Organic Blueberries 6 32 oz 41 Center Store Grocery 71153550481 4344697 Blue Corn Tortilla Chips 12 9 oz 42 Center Store Grocery 71153550479 4344694 Yellow Corn Tortilla Chips 12 9 oz 43 Vegetables Produce 71153550194 6488277 Russet Potatoes 10 5 lb 44 Center Store Grocery 71153550742 4280485 Organic Virgin Coconut Oil 12 14 oz 45 Herbs Produce 71153550324 6486645 Organic Mint 3.75 oz 46 Dog Food Pet 71153550954 4020532 Brown Rice, Lamb, Carrots Dog Food 1 14 lb 47 Package Salads Produce 71153550203 6484136 Organic Romaine Blend 6 5 oz 48 Center Store Grocery 1153550154 4148630 Organic Ketchup 12 20 oz 49 Herbs Produce 71153550326 6486428 Organic Rosemary 3.75 oz 50 R113991 06/21/18 PB_WHSellSheet_8.5x11_vTop50