The IRI New Zealand team shared their annual NZ State of the Industry presentation on Wednesday 17th November. The focus was on sharing actionable insights to inform FY22 strategy and beyond.
The presentation covered:
• Driving growth in a border impacted economy
• Economic outlook for 2022
• Market and environmental forces impacting retail FMCG
• Consumer behavioural trends and opportunity
• Strategy and global learnings to support growth
The IRI annual State of the Industry event was deemed a huge success. Craig Irwin, Managing Director for New Zealand and Hong Kong, with IRI®, a global leader in innovative solutions and services for consumer, retail and media companies, praised all involved in this year’s event and thanked the New Zealand FMCG sector for attending in record numbers. Approximately 1,000 people logged on to be part of the much-anticipated virtual event, which covered the sector’s response to the pandemic and outlined opportunities to drive growth in the face of social, industry, financial and economic challenges. The event was chaired by Irwin and included highly respected industry experts.
Irwin said: “The success of this year’s event reflects the range of challenges facing the New Zealand FMCG sector including a border impacted economy, supply chain issues, a skills shortage, inflation, rising interest rates and wages growth. While New Zealand has been relatively untouched by COVID until recently, we are still facing broader issues as a result of the pandemic and its impact on the global and local market space.
“Despite the challenges ahead, based on IRI’s extensive insights and analysis, we outlined a range of positive opportunities for the FMCG industry and drilled down into the trends and consumer behaviours driving these. Everyone in the sector realises that the economic fallout is certainly not over however, we now have clear visibility on how to navigate through the pandemic and beyond.
“The sector will need help and support to develop the strategies and tactics to achieve growth. At IRI we are well placed to provide guidance and insight into how to navigate through COVID to the other side. Being a global organisation, we are able to draw on statistics, trends and tactics being utilised with great success in other countries around the world. Our local insights are also second to none.
“We were able to share these insights with the New Zealand FMCG sector at the event. Our hope is that our expertise and knowledge will assist them to navigate the pathway forward. It might sound cliché, but the reality is that we are all in this together. At IRI, we are in a unique position to be able to help steer the industry through the pandemic and into clear skies moving forward.”
The IRI event was developed specifically for retailers and manufacturers in the FMCG sector and included IRI’s most up to date research and the perspectives of experts in the field.
Under the theme of ‘Driving growth in a border impacted economy’ the State of the Industry presentation focused on key areas.
• The economic landscape
The financial and economic impact of a bordered economy on the New Zealand FMCG industry. Experts worked through the biggest challenges facing business including a skills shortage, supply chain issues, inflation, rising interest rates and wages growth. Attracting and retaining workers was identified as a key risk to growth as businesses deal with wage increases in a tight labour market. The key take-away of this area of focus emphasised that growth is still possible while factoring in these issues.
• Supply chain issues
The rising cost of shipping cargo and extended delays in the supply chain as shipping lines struggle to cope with the increasing volume of cargo being shipped across the world is causing serious issues for New Zealand and Australia. This is adding significant cost and extensive delays to the industry. As a result, we have seen a sharp rise in the cost of items. While a challenge, it also offers significant opportunities for locally driven competition and the emergence of agile and innovative businesses and brands.
• At home – elevate the ordinary and dial up convenience factors
We may have more technology at our fingertips but are still struggling with that age-old question ‘what are we having for dinner tonight?’ Deciding what to have and thinking of new and different things to cook remain key challenges for household shoppers. Brands that provide busy Kiwis with time and effort-saving solutions are growing. Adding excitement to the ‘everyday’ to elevate those ordinary moments is another way to win with shoppers. Finding favour are brands that can provide restaurant quality foods to cook at home or products that introduce fun, humour or nostalgia through new flavours, packaging or experiences.
Overall Kiwis are adopting a much more holistic approach to their health and utilising a number of ways to boost their immune system from exercising more, getting a good night’s sleep, to minimising their stress levels. They are also consciously seeking out healthier options to eat and drink with an increasing trend towards functional and plant-based foods.
Debbie Simpson-Pudney, Head of Retail, Solutions & Innovation at IRI New Zealand revealed in her presentation that 64 % of household shoppers believe food can be as powerful as medicine and this is evident in the growth of foods with on-pack call-outs, such as ‘immunity’ and ‘mental performance’. Sales in non-alcoholic beverages are thriving due to innovative packaging, low sugar options and tantalising flavours being introduced to entice consumers. Kiwis are also drinking less with 29% of household shoppers saying they are consuming less alcohol compared to a year ago.
Driving growth in a border impacted economy requires an innate understanding of consumer behaviour and the considerations and issues facing the community. IRI and its event experts explored these issues in depth providing examples of the insights and understanding needed to navigate a pathway forward. These included the health of consumers, understanding what is important for them in their home, the budget issues they are facing and the values driving their buying decisions.
IRI is a leading provider of big data, predictive analytics and forward-looking insights that help CPG, OTC health care organisations, retailers, financial services and media companies grow their businesses. www.iriworldwide.com