The Senior Consumer. The Institute of Food, Medicine and Nutrition October David Donnan. A.T. Kearney October
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1 The Senior Consumer The Institute of Food, Medicine and Nutrition October 2015 David Donnan A.T. Kearney October
2 We are facing an Agequake THE SUPER-AGING OVERHANG (Countries with >65 segments over 20%) GERMANY GREECE ITALY JAPAN BULGARIA CROATIA FINLAND FRANCE GERMANY GREECE ITALY JAPAN MALTA NETHERLANDS PORTUGAL SLOVENIA SWEDEN COUNTRIES INCLUDING: JAPAN (30.7) GERMANY (28.2) ITALY (26.8) KOREA (23.4) FRANCE (23.2) SWITZ (21.9) UK (21.7) US (20.1) A.T. Kearney October
3 By 2025, the 100+ population will increase to 119k, up 65% from 2015, making it the fastest growing age cohort A.T. Kearney October
4 By 2017, the 50+ population is expected to spend close to 50% of CPG dollars; however <5% of advertising is aimed towards the group A.T. Kearney October
5 29% of households 55+ have no Defined Benefit Plan or retirement savings (e.g. 401k, IRA) A.T. Kearney October
6 The A.T. Kearney Global Maturing Consumer Study They have distinct characteristics They buy different product categories and enjoy shopping more! They shop often, in smaller stores and closer to home They are more loyal and more demanding on quality They watch for promotions but do not find them adapted Their priorities evolve as they age 1. Benelux, Denmark, France, Germany, Italy, Norway, Spain, U.K., Romania and Turkey Source: Euromonitor, A.T. Kearney analysis A.T. Kearney October
7 More than 3,000 consumers from seven countries revealed common themes When I buy shampoo, there is a big logo of the company and not much else on it. You need glasses to see what the product actually is, and in the bathroom you often don t wear glasses. -Gerhard, 68, Germany I am not as tall as I used to be and I do feel it when I cannot reach a product on the shelf. I always wish someone would help me, but it is seldom the case - Denise, 82, France I do think they need some seating as it is tiring to push a trolley round. Perhaps a coffee bar, too, not necessarily to socialize but to relax and have a coffee before catching the bus back -Enid, 77, England A.T. Kearney October
8 Older shoppers think they are not adequately served by marketers, retailers, or manufacturers Shopping is difficult due to the inability to navigate large shops with hard-toreach products on shelves Product packaging poses a challenge to opening while labels, prices and directions are hard to read A.T. Kearney October
9 Mature Consumers buy different product categories Where Mature Consumers spend less of their income 1 14 % 18 % 20 % Where Mature Consumers spend more of their income 1 11 % 5 % 4 % 4 % 7 % Transportation Clothing Food and Beverages Healthcare 1. Average share of basket compositions in the following countries: Brazil, Bulgaria, China, Denmark, Finland, France, Germany, India, Indonesia, Japan, Mexico, Netherlands, Norway, Romania, Russia, South Africa, Spain, Sweden, Turkey, U.K., U.S. Source: Euromonitor, A.T. Kearney analysis A.T. Kearney October
10 Often they enjoy shopping more 68 % 73 % They shop more in the morning because : Shopping is often on top of their daily priorities 51 % Shopping is the occasion to go out, better do it in the morning when they are not tired yet 1. Based on a U.K. study Source: A.T. Kearney Global Maturing Consumer Study, University of Ulster: Age associated changes in older consumers retail behaviour A.T. Kearney October
11 And they prefer to shop in smaller stores Preference for smaller stores 39 % 19 % 25 % Source: A.T. Kearney Global Maturing Consumer Study A.T. Kearney October
12 They value proximity 80 % They walk rather than drive 60 % 40 % 20 % 0 % [60-64] [65-69] [70-74] [75-79] 80+ Walking Driving car 1. Share of respondents ranking proximity as one of their two top criteria to decide where to shop Source: A.T. Kearney Global Maturing Consumer Study A.T. Kearney October
13 Selling to the Mature Consumer Affordability Nutrition Assistance Programs Drug Stores Food and Nutrition Information Food Shopping Location Nutrition Resources Nutrition while Eating Out Source: AARP Foundation Food Insecurity Research 13 A.T. Kearney October
14 But, Governments will be under stress Increased length of pension costs Increased length of healthcare costs Nutritional based disease management A.T. Kearney October
15 Finding alternative models for outreach Food Sourcing Food Preparation Food to Consumer Emerging Innovations Ex: Leverage buying power to obtain cheaper prices Ex: Ready-made baskets to reduce labor cost Ex: Food delivery that leverages the USPS network A.T. Kearney October
16 A new model for food re-distribution Traditional Retail donations from farmers, grocery stores and other retailers Industry donations from distributors, wholesale and other sources Community food drives Food purchased using monetary donations from grants, corporations, foundations and individuals Market Driven Models Partnerships with distributors to provide food at cost to disadvantaged populations Consolidation of buying power leveraging high demand from the growing 50+ Mutually beneficial partnerships; examples include AmazonFresh and USPS, Peapod and Stop & Shop, etc. A.T. Kearney October
17 The Senior Consumer The Institute of Food, Medicine and Nutrition October 2015 David Donnan A.T. Kearney October
18 A.T. Kearney is a global team of forward-thinking, collaborative partners that delivers immediate, meaningful results and long-term transformative advantage to clients. Since 1926, we have been trusted advisors on CEO-agenda issues to the world s leading organizations across all major industries and sectors. A.T. Kearney s offices are located in major business centers in 39 countries. Americas Atlanta Calgary Chicago Dallas Detroit Houston Mexico City New York San Francisco São Paulo Toronto Washington, D.C. Asia Pacific Bangkok Beijing Hong Kong Jakarta Kuala Lumpur Melbourne Mumbai New Delhi Seoul Shanghai Singapore Sydney Tokyo Europe Amsterdam Berlin Brussels Bucharest Budapest Copenhagen Düsseldorf Frankfurt Helsinki Istanbul Kiev Lisbon Ljubljana London Madrid Milan Moscow Munich Oslo Paris Prague Rome Stockholm Stuttgart Vienna Warsaw Zurich Middle East and Africa Abu Dhabi Dubai Johannesburg Manama Riyadh A.T. Kearney October
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