June 6 th , 2017
A digitally connected
food world
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of packaged food is
over the next 5 years, this is go beyond traditional market strategies to stay relevant and
Global Packaged Food Retail Value:
Global Packaged Food Retail Value:
Find new pockets of growth in a stationary market
Sources: EuroMonitor; KPMG Analysis
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Sales growth in developed markets will be static…
473 475
32 34
119 127
360 97 371 115
173 202
437 527
…and tomorrow Until Today… Italy
Sources: EuroMonitor; KPMG Analysis
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… and emerging markets become more attractive.
Emerging markets Developed markets
Sources: EuroMonitor; KPMG Analysis
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Consumer base is changing…
Sources: EuroMonitor; KPMG Analysis
Users in 2016 penetration in
developed counties in 2016
controlled by by 2025 (30% today)
Increasing single- persons households
Consumers don't consume
food but experience it
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…retailing is now omnichannel…
through an (traditional
stores, e-commerce, social media, etc.) is becoming a
Of retailers said that
would have the greatest impact on their organizations
Having a real time view and control over inventory
Ensuring a fast check-out experience
Improve data capture capabilities
Sources: EuroMonitor; KPMG Analysis
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…and buying processes and induction are changing
From impulse in purchasing process… …to impulsive instant purchasing
Sources: EuroMonitor; KPMG Analysis
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© 2017, KPMG Advisory Spa, an Italian limited liability share capital company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. All rights reserved.
© 2017, KPMG Advisory Spa, an Italian limited liability share capital company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ("KPMG International"), a Swiss
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However Italian cuisine is still the most appreciated world wide
Evide nce of tr en d- sett ing influ en ce
Chinese
Scandinavian British
Spanish
Mexican Korean Thai
American Fast Food
American Korean
American Japanese Latin
Japanese
Korean French Mexican
American Tex Mex
Japanese
Greek Vientnamese
Portuguese
Filipino
Cuban
Indian
Sources: Thefoodpeople - KPMG Analysis
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However Italian cuisine is still the most appreciated world wide
Evide nce of tr en d- sett ing influ en ce
Australian traditional
Tex Mex Chinese
Malaysian Scandinavian
Filipino British
Turkish Greek
Spanish
Mexican Korean
Thai
American Fast Food
Indian
American Korean American
Japanese Russian
Latin Japanese
Eastern
European Portuguese
Modern Australian
Korean French Japanese
German Indonesian
Sources: Thefoodpeople - KPMG Analysis
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However Italian cuisine is still the most appreciated world wide
Evide nce of tr en d- sett ing influ en ce
British
Indian American
French Tex Mex
Korean Thai
Chinese
Middle Eastern American
Korean Scandinavian
Spanish Brazilian
Filipino
German Prussian
Greek
Argentinian Japanese
Mexican
Vientnamese
Modern British
Sources: Thefoodpeople - KPMG Analysis
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has turned into a for many products in many Countries,
sold in 2016 makes of
EUR 1.851 billion
EUR 125 billion EUR 39 billion
EUR 502 billion EUR 1.185 billion
Is current online penetration a weakness or an opportunity?
Sources: EuroMonitor; KPMG Analysis
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What potential digital channel has for Italian food?
(€/bn)
EUR billion ̴
Sources: EuroMonitor; KPMG Analysis
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The 3 pillars for a successful omnichannel strategy
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Identify high potential markets
and , relatively ,
, where Countries are expected to face low GDP growth and possess stable populations.
160.000
120.000
100.000 80.000 60.000 40.000 20.000 0 140.000
ITALY INDONESIA
FRANCE UNITED
KINGDOM BRAZIL
INDIA USA
CHINA MEXICO RUSSIA GERMANY JAPAN TURKEY
Passport Baseline Unmet Potential )
Sources: EuroMonitor; KPMG Analysis
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Identify high potential online markets
• % of total population with internet Access
• % of total population with Broadband Access
• Household by Type (e.g. Single Person, Couple with Children)
• % population
• Population by Age
Segmentation (e.g. Age 20-39, 40-59 )
• % Market share of top 5 Modern retailers
• Number of top 5 modern Grocery retailers with Pre- Existing online ventures
• % of total Grocery Sold via Online Shopping
Sources: EuroMonitor; KPMG Analysis
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0 1 2 3 4 5 6 7 8 9 10
0 1 2 3 4 5 6 7 8 9 10
B us in es s En vi ro nm en t F ac to rs
Demographic & Technological Factors
ME & Africa Asia Pacific Europe North America Latin America
(US $ Mln)
1.500.000 10.000 500.000 1.000.000 Australasia
Identify high potential online markets
Sources: EuroMonitor; KPMG Analysis
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Identify high potential online markets - UK
- 5.000 10.000 15.000 20.000
Va lu e sa le s 20 10 0 2 01 5 ( U S$ m ln ) Va lu e sa le s % C A G R (2 01 0- 20 15 )
Online Sales of Amazon UK vs UK grocery retailers 2010-2015
E-commerce value sales % CAGR ( 2010-2015)
The represent a successful example of the huge potential brought by where grocery retailers invested in digital as a channel driving its expansion.
digital retail market share is today , and will have to some
2010 2015 2010 2015 2010 2015 2010 2015 2010 2015
Sources: EuroMonitor; KPMG Analysis
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Identify high potential online markets - India
is still with
and
Only of Indian population will have
account for just of total market, and food companies must use
for reaching target consumers.
Breakdown of population in the APAC region, by social class
Sources: EuroMonitor; KPMG Analysis
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© 2017, KPMG Advisory Spa, an Italian limited liability share capital company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. All rights reserved.
Identify high potential online markets - USA
Sales
% Breakdown of total Sales by Channel in USA, 2015
In addition, consumer are and worried about .
Overcoming this perception is the
Online food spending in due to and widespread
(89%) and that favor .
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
% Total grocery sales 2015
Sources: EuroMonitor; KPMG Analysis
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Identify high potential online markets - France
Grocery Basket % Breakdown in France, 2015
% Total grocery sales 2015
In , food sales , with French retailers committed in
promoting experiences
This is a situation, with online retailers benefitting from a and buyers experiencing more
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Sources: EuroMonitor; KPMG Analysis
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The 3 pillars for a successful omnichannel strategy
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Volume Sales % CAGR (2015-2020)
-1,5 -0,5 0,5 1,5 2,5 3,5 4,5 5,5 6,5
Demographics Soft Drivers Product Price Population Market Environment Habit Persistence GDP per Capita
Select the best products mix
0,25 0,52 0,52 0,57 0,66 0,76 0,80 0,80 0,86 0,81
0,62 0,65 Food Category Elasticity
but some are than
, such as baby food, are the by
Sources: EuroMonitor; KPMG Analysis
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0%
5%
10%
15%
20%
Dairy Processed Meat
and Seafood Confectionery Savoury Snacks Biscuits & Snack Oils and Fats Sauces &
dressing
France and UK food habits remain much the same online, as the main drivers are the established brick and mortars players
Pr od uc t's % o f T ot al C ha nn el S al es
What impact does online shopping have on product mix?
Sources: EuroMonitor; KPMG Analysis
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0%
5%
10%
15%
20%
Confectionary Dairy Savoury Snacks Biscuits & Snack Processed Meat
and Seafood Sauces &
dressing Oils and Fats
Pr od uc t's % o f T ot al C ha nn el S al es
Non-staple food is an opportunity in the US.
Manufacturers are segmenting the market selling more expensive goods exclusively online
What impact does online shopping have on product mix?
Sources: EuroMonitor; KPMG Analysis
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0%
10%
20%
30%
40%
Dairy Baby Food Rice, Pasta,
Noodles Confectionary Processed Meat
and Seafood Savoury Snacks Oil & Fats
Pr od uc t's % o f T ot al C ha nn el S al es
China's desire for global brands makes internet channels a priority.
Dairy and baby food perform particularly well
What impact does online shopping have on product mix?
Sources: EuroMonitor; KPMG Analysis
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0%
10%
20%
30%
40%
50%
60%
Rice, Pasta,
Noodles Dairy Baby Food Processed Meat
& seafood Biscuits & snack Ice Cream Confectionery
Pr od uc t's % o f T ot al C ha nn el S al es
South Koreans are replacing offline shops for staple food products.
A third of all rice, pasta and noodles are sold online
What impact does online shopping have on product mix?
Sources: EuroMonitor; KPMG Analysis
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The 3 pillars for a successful omnichannel strategy
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Brave new world requires relationships with new retailers
Sources: EuroMonitor; KPMG Analysis
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No ‘one size fits all’ approach for global online strategy
Identify and seize
Select the right : brand website or retailer website
will be a mixture of value for money and exclusive online options
Interacting with
such as Amazon, Alibaba and Ocado
will be re-imagined
Evolve the and
Develop a coherent
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