The latest grocery share figures from Kantar Worldpanel UK, published today for the 12 weeks ending 9 June 2013, show continuing market polarisation with Aldi, Lidl and Waitrose all stealing share from the big four retailers.

Aldi sets another all-time record share of 3.6% – an increasingly frequent occurrence for the retailer which has averaged 30% annual sales growth throughout 2013. Meanwhile, Lidl and Waitrose both hold on to their record shares of 3.0% and 4.9% respectively, with Waitrose recording growth of 10.4% – well over three times the market average.

These performances have enabled Aldi, Lidl and Waitrose to exert continued pressure on the big four with share dips for Tesco, Asda and Morrisons. Only Sainsbury’s bucks the trend, increasing its share to 16.7% and posting market-beating sales growth of 3.5%.

Although Morrisons’ share continues to decline, the loss this period is the lowest for 2013 and indicates a small underlying improvement for the grocer.

Fraser McKevitt, retail analyst at Kantar Worldpanel, comments: “The continuing polarisation of the grocery market poses a difficult question for the big four retailers – how to make their offer appealing in an increasingly squeezed market. Asda recently announced it is going toe-to-toe with Aldi on the price of fresh food and produce, demonstrating its growing concern with the threat from the discounter.

“Savvy shoppers are looking for a good deal, but Britain’s largest supermarkets should not lose sight of the other attributes consumers are looking for in their grocer – quality products, clear provenance and an enjoyable in-store experience. The big four will have to keep an eye on maintaining these standards, even when competing on price, to make sure that they offer genuine value for money and not just cheap goods.”

Market growth is currently at 3.0%, down from 3.9% in the previous period. The dip between this year and the same period in 2012 can be largely attributed to the Diamond Jubilee.

An update on inflation

Grocery inflation remains at 3.9%* for the 12 week period ending 09 June 2013. This exceeds the market growth of 3.0% which suffers from comparison with the 2012 impact of the Diamond Jubilee.

*This figure is based on over 75,000 identical products compared year-on-year in the proportions purchased by British shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Watch the previous commentary here.

The app is regularly updated with the latest grocery share figures and clients can also use the app to view data for the last 2 years, a useful tool when tracking the historical performance of a retailer.

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Latest Grocery Share

The latest UK Grocery Share data will be released on 18th June and Ireland Grocery Share Data on 24th June.

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The Vietnam economy continued to face headwinds as slow reforms were clouding growth outlook. The IMF lowered its forecast for Vietnam’s growth in 2013 to 5.2% from 5.8% percent, the largest reduction, after Singapore, among ASEAN countries.

In April, the total FMCG market maintained a value growth at +8.3% in Urban and +12% in Rural compared with the same period last year. In Urban, Personal sector enjoyed the strongest growth of +15% compared with last year, mainly driven by baby care categories and added value items such as hair conditioner, facial moisturizer, deodorants, etc. In Rural, Beverages and Dairy lead the growth at +25% and 24% respectively.

Fueled by rising demand for convenience among Urban consumers, Rice Soup shone as the star among FMCG categories with a remarkable 61% increase in volume compared with the same quarter last year. In Rural, Beer was the most outstanding category among the leading Beverages with 49% uplift in volume consumption.

Influenced by an overall slow-down in FMCG market, most key channels in Urban and Rural witnessed a moderate growth compared to the same period last year, especially Modern Trade, which even shrank in value. Continued economic downturn was making Vietnamese shoppers become more prudent. They were demanding greater value for money as they turned to Private Label products for better price offers. Though representing only 3% in Modern Trade, Private Labels were going mass throughout the recent years, reaching two fifths of Urban families. Beside heading for value-for-money options, shoppers also found Hyper/Supermarket less appealing as fewer switching occasions from Street Shop to Hyper/Supermarket were observed among Urban consumers. Apparently, amid unfavoured economic conditions, price barriers might hinder consumers from shopping in Hyper/Supermarkets. According to Lifestyle Survey conducted by Kantar Worldpanel by end of 2012, “Hyper/Supermarkets are more expensive than traditional trade” was a common concept among 55% urban consumers while this figure only counted to 50% in 2011.

“In order to sustain growth during hard times, FMCG companies should put “value for money” at the heart of their communication and offer to Vietnamese consumers”, David Anjoubault – General Manager of Kantar Worldpanel Vietnam – commented. “For manufacturers, this does not simply mean focusing on cheap prices and discounts, but more about highlighting the value equation of the product offer and justifying the price with appropriate benefit level. For retailers, comfortable shopping experience and good deals would help build their values in shopper perception.”

Find out more: 

Read the previous FMCG Press Release here.

Dominic Sunnebo, global consumer insight director at Kantar Worldpanel ComTech, comments: “There is an increasing divide in the mobile dynamics across Europe, driven by different levels of handset subsidies and differing economic performances. In Germany, the Samsung Galaxy SIII handset took 23.5% of all smartphone sales in the latest three months, compared with just 4.7% in Spain. The increasing desire for handsets costing under €150 in Spain and Italy has helped Sony and LG to drive serious share gains. In Spain, Sony has a 19% share and LG is up to 17% from just 3% the previous year. Their growths in share have primarily been driven by entry level handsets such as the Sony Xperia U and LG Optimus L3/L5 models.

“Android and iOS continue to take the lion’s share of smartphone sales in Britain. However, Windows phones are becoming increasingly popular with consumers. Windows has grown its share by 4.4 percentage points compared with the same period last year and now holds an 8.4% share of the market.”

Android’s ability to play across the price spectrum is not going unnoticed, with Apple driving sales of its older iPhone 4S and 4 models through increasingly competitive pricing, meaning all three of its handsets remain in the six best-selling smartphone models in Britain.

Across the globe

Apple continues to perform well in Urban China, accounting for one in four of all smartphone sales while maintaining an 82% price premium compared with the smartphone market average. Samsung remains the top brand in Urban China with 30.2% share, Apple in second place with 25.1% with Lenovo in third place with 10.3%.

Although Android is still the number one OS in the US with 51.7% share, Apple is growing at a slightly faster rate and holds the number two spot with 41.4% share. In good news for Microsoft, Windows Phone continues to make solid progress with OS share hitting 5.6% and the Nokia 822 selling well on Verizon.

*3 m/e Apr 2013

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News about ComTech in other countries:

Read the US ComTech report here.
Read the Spanish ComTech report here.
Read the Chinese ComTech report here.

Through the 3 month period ending April 2013, Android now owns more than half (51.7%) of the smartphone sales market,. iOS remains in second place with 41.4% of smartphone sales, while Windows’ smartphone sales share remains at 5.6% - compared to last month - but has grown over the last year by 1.8% points. Positive movement can also be seen across carriers, too, particularly by leader Verizon with 36.3% of smartphones sold (1.8% points increase) and Sprint Nextel with 13.1% of smartphones sold (1.4% points increase). AT&T, in second place, remains stable at 26.3%, while T-Mobile declines to 11.3%.

The data is derived from Kantar Worldpanel ComTech USA’s consumer panel, which is the largest continuous consumer research mobile phone panel of its kind in the world, conducting more than 240,000 interviews per year in the U.S. alone. ComTech tracks mobile phone behavior and the customer journey, including purchasing of phones, mobile phone bills/airtime, and source of purchase and phone usage. This data is exclusively focused on the sales within this 3 month period rather than market share figures. Sales shares exemplify more forward focused trends and should represent the market share for these brands in future.

Kantar Worldpanel ComTech analyst Mary-Ann Parlato states, “Verizon and Sprint’s slight increase is thanks to the growth of two key players. For Verizon, Windows’ share rose from 0.2% in the three months ending April 2012 to 6.8% by the period ending April 2013. At Sprint, they continued to reap share increases thanks to their iOS offering- iOS sales share on Sprint grew from 33.4% to 38.4% over the last year.”

Windows has begun to capture consumers from across the competitor set. Of those who purchased a Windows device in the last year, 42% came from a featurephone device, 25% from another Windows device and 23% from Android. While iOS is similarly effective at capturing Android users and their own users, only 31% came from a featurephone device, showcasing Windows strength in attracting featurephone users.

“But it’s not just about capturing the market that is yet to upgrade. Windows is also seeing success in the younger group. When looking at those who changed device, between 2011 and 2012 Windows was more successful at capturing older consumers aged 50-64. But when looking at those changing now and in the last year, we’re seeing Windows now gaining share among those aged 25-34.” Parlato continues.

Looking at specific sales of smartphone devices, for the 3 month ending April 2013, Nokia’s Lumia devices were the key models driving success for the Windows OS.

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During the first quarter of 2013, Android continued its steady growth in China, marking a key milestone in reaching 50% share of Smartphone Installed Base. At the end of March 2013, Android widened its lead of Smartphone operating systems with a 51.4% market share, an increase of 2.8% compared to the previous quarter. Second and third place was taken by Symbian and iOS, whose market share is 23% and 19.9% respectively. Symbian has declined 2% in the last quarter, whilst iOS remained resilient. Following the same trend, Symbian looks likely to lose its second place to be the third in the next 2 quarters.

Kantar Worldpanel ComTech also tracks the performance of various mobile device brands, according to its latest report, many Chinese local brands have been working closely with carriers and demonstrated strong growth in the Smartphone market for the first three months of 2013. ZTE, Lenovo and Xiaomi all have experienced share increases.

The combined market share of above four local brands are at 20%, a 17.6% growth in the past 6 months. Huawei, ZTE, Lenovo, Coolpad & Xiaomi combined make up 1 in 5 of all Smartphones in active use in China-this proportion will continue to grow as Nokia’s existing dominance is challenged.

Yu continues:”Local manufacturer brands have been able to drive strong growth through bundling their handsets with carriers tariff offers, seeking out new sales channels & combining innovative product design with value to capture many first time Smartphone buyers and those residing in City tiers 2/3/4.

However, Samsung remains the fastest growing Smartphone brand in China, ended Q1 2013 with 15.2% share of Installed Base (1.5%pts). Craig Yu continues:”Samsung has recently launched the Galaxy S4, selling over 10 million units globally in less than one month-we predict the launch of Galaxy S4 mini in the not too distant future will greatly increase its product reach in urban China.”

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News about ComTech in other countries:

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Fiction - Chinese lower tier women have less developed beauty regime than their upper tier peers

The conventional category development model that we have become familiarized with is that women in Key cities1 have the most advanced beauty regime while women in C/D cities have the least developed. We do see some evidence for this; women in Key cities DO have the most extensive regime – using on average 8 care products every week. Specifically we see their usage of more developed cleansing formats like Shower Gel, Facial Cleanser and Liquid Hand Wash is far beyond those of their lower tier sisters.

However despite these notable examples, we see remarkably little difference between women’s regime through the city tiers. The gap between most developed and least developed regime is only 7% in number of categories used. And what is further surprising is that if we look at some emerging facial care products – eye, toner, serum – they are MORE popular amongst lower, C/D tier women than for Key or A tier women. Within toner we see the increased development in lower tiers being driven by wider usage across all generations, with groups of traditionally lesser importance to manufacturers already showing high rates of usage. Younger women (16-25) and older women (46-55) are both more likely to use toner within lower tiers whilst amongst the core beauty users (26-45) there are relatively little differences between tiers.

Part of the explanation behind wide usage of these advanced categories lies in the availability of lower priced brands. In comparison to shoppers in Key cities, consumers in C/D tiers spend about 30% less per shopping trip on categories such as Toner. Domestic brands like Pechoin and Danzi’s higher presence in lower tier provide an attractively low entry point for lower tier shoppers.

Trade Up Through New Channels

We’ve seen how women in lower tier already have developed beauty regimes – so where are the opportunities for manufacturers in lower tiers today and how can they realize them? While women are using similar categories in lower tiers they choose a radically different kind of brand from a radically different retail environment. In face care, domestic economy brands (such as Dabao) account for only one in four of all key city usage occasions compared to one in two in C/D tiers. This highlights the category development potential in trading up but also the importance of manufacturers having a broader portfolio of brands specifically tailored to lower tier consumers if they are looking to succeed with all consumers. Currently only domestic manufacturers (or domestic acquisitions) have the right range available to reach a lot lower tier consumers.

Entering women’s consideration set requires being available at the point of purchase and as we see across FMCG categories, this requires a very different distribution model in lower tiers. Channels like cosmetic stores (predominantly small independent outlets) are important in lower tier. Gaining distribution through these disparate outlets can be very challenging and may not be a viable opportunity for manufacturers who are looking to maintain close control over their brand’s in store theatre. With the rapid emergence of online, and the continued development of modern trade, we can expect the global brands to increase their presence in lower tiers although they face fierce competition from the likes of Inoherb.

One key difference in the competitive set in lower tiers is the example of direct sales. Direct sales have been very successful in getting lower tier shoppers to both expand regime and spend more on premium products. While the average cosmetic store shopper in C/D tiers spends about 220 RMB/year on skin care products, an average direct sales buyer spends 540 RMB. This clear demonstration of the potential within lower tiers also has implications for manufacturers who will be both competing with and learning from the strategies employed by direct sales operators. Personal interactions are important and ensuring that consumers are provided the correct education and brand introductions at the point of purchase can be effective to succeed in lower tiers. As hypermarkets continue to expand their reach, use of brand specific counters can allow the multinationals greater personal access to women in lower tiers. Building close relationships with the trade and ensuring that brands have the correctly trained representatives have a big role in category development.

For men - its key vs. others

While women show that lower tier assumptions are no longer valid, for men there is still a large role for city tier specific, category development strategies. Men in Key cities lead the way across all categories using at least one additional care product every week in comparison to men in other tiers. The difference is most marked in the facial care market where aggressive marketing has already developed men’s regime far beyond that of European peers. In key cities, 2 in 3 men use a facial cleansing product and 12% of men use toner within an average week. While we see that in Key cities manufacturers need to prioritize the premiumisation of the market, getting men using more expensive male specific products, within the other cities in China the strategic focus remains category conversion. Outside of key cities there is little difference in men’s regime; those living in A, B or C/D tiers all have similar beauty habits. This suggests a need for a two pronged strategy; premiumisation in ‘Key’ versus regime expansion in ‘A/B/C/D’ tiers.

Conclusions - 3 Key Take Outs For Winning In Lower Tiers

• First To Market Advantage Already Gone – As women in lower tiers already have an advanced care regime; manufacturers can no longer base a city tier strategy about driving category trial. Smaller, cheaper, local brands are widely used across advanced categories leaving the next opportunity in ensuring consumers are correctly educated in usage, recognize the correct functional role in each regime step and trade up to more premium brands.
• Unique Channel And Portfolio Strategy Required – Reaching these users requires a very different strategy to that which has historically worked in upper city tiers. With wide access to the internet and ATL communication generally reaching across tiers – lower tier users are already exposed to information on the major brands. However at the point of purchase, the ‘moment of truth’, the multi-national brands are struggling given their lack of availability and control within the dominant local, multi-brand cosmetic stores. E-Commerce’s rapid emergence provides an excellent opportunity to reach these consumers while engaging them with brand proposition and equity, but with only 14% of shoppers currently buying their skincare online it does limit the audience. Manufacturers may need to launch a lower priced, lower tier specific brand where they relinquish some control over distribution and pricing in order to gain wider access to local cosmetic store formats.
• For Men Go Deep And Be The Category – Outside of Key cities, males’ habits are still emerging leaving brands with potential to become the heritage brand in a category. Given the limited regime and seasonal nature of men’s face care usage, education is crucial in category development.

David Berry, commercial director at Kantar Worldpanel, explains: “Aldi and Lidl have posted a combined record share of 13.6%, an increase of two percentage points from 11.6% last year. Both retailers continue to secure strong sales growth and win new customers. In the latest 12 weeks, Aldi has recruited an additional 100,000 shoppers and Lidl has added 62,000.

“In the face of continued price inflation and the onset of the Local Property Tax, shoppers continue to rein in their spending and look for the best value. Shopping across a range of different retailers is a big trend among consumers, who are making smaller, more frequent trips.”

As consumers look to save money and the discounters grow, Tesco and Dunnes have seen their sales decline, with market share falling from 28.4% to 27.6% for Tesco and 22.4% to 22.1% for Dunnes. SuperValu have again performed ahead of the market, holding onto 19.8% market share, while the recent improved performance of Superquinn continues with share maintained at 5.5%.

David continues: “Online grocery sales have grown by 7.9% in the past year, compared with an annual in-store growth of just 0.2%. With shoppers spending an average of €62 per trip on the internet compared with €22 in-store, online presents a key opportunity for the traditional retailers.”

An update on inflation

Grocery inflation stands at 5.0%* for the 12 week period ending 12 May 2013, down from the 5.3% seen last period.

*This figure is based on over 30,000 identical products compared year-on-year in the proportions purchased by Irish shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Read the previous report here.
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Aldi has posted an all-time record share of 3.5%, increasing from 2.8% last year. The retailer’s successes also continued, as it set its highest ever year-on-year growth, 31.5%, over the past 12 week period.

Waitrose holds on to its record share of 4.9% reported last month, with growth of 12.0% − over three times the market average.  Meanwhile, Lidl has also maintained its largest share of 3.0% and posted strong sales growth of 8.9%.

Edward Garner, director at Kantar Worldpanel, comments: “The success of Aldi, Lidl and Waitrose are clear examples of how shopping habits are divided across the country.  For many consumers, the discounters are increasingly becoming part of the weekly shop – supplementing trips to the big four retailers and offering a convenient and cheaper option.  We expect this growth to continue, particularly as store expansion plans open up the discounters to a wider number of customers.

“This market polarisation also continues to pile the pressure on the big four grocers, with only Sainsbury’s beating the market and growing its market share this period.

“Although Morrisons shows a share loss, it is worth noting that the retailer returned to growth in 2013 and continues this upward trend in the latest period − growing 1.2%. With its plans for online and accelerated convenience store coverage now in place, the retailer will hope that successful implementation will return it to share growth.”

An update on inflation

Grocery inflation stands at 3.9%* for the 12 week period ending 12 May 2013. This now matches the market growth which means that the pressure on households to trade down has lessened.

*This figure is based on over 75,000 identical products compared year-on-year in the proportions purchased by British shoppers and therefore represents the most authoritative figure currently available.  It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Watch the previous commentary here.

In the UK, the Sunday Times Magazine has recognised the company for the 3rd year in a row with the prestigious Sunday Times Best Companies to Work For Award. In France, the Great Place to Work Institute has recognised France’s office in its 2013 Best Workplaces ranking in the category of Less than 500 Employees. Great Place to Work has also rank Spain’s office in the 2013 Best Workplaces list for the 250 to 499 Employees category.

Andrew Fowler, Global HR Director says “I am proud and delighted that Kantar Worldpanel have been recognised in these highly regarded employer awards in our three main European markets. The fact that we are the only market research agency to achieve this reflects the investment we continue to make in creating a culture of development and high performance where our talented colleagues can fulfil their potential.”

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• Sunday Times Best Companies to Work For
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Vietnam Consumer Pulse – A country between challenges and opportunities

2012 casts a shadow on Vietnamese economy with a low GDP growth – the lowest in the last decade, soaring bad debts levels, stagnant production and low demand. However, there are still bright spots in the overall picture, which might pave the way for a rebound in 2013 and years to come. For instance, inflation rate, which has been a persistent woe of the economy, is well curbed at 9.2% over 2012, significantly lower than the average rate of 18.7% in 2011. The local currency VND has also held its value with a stable exchange rate with US dollar and the country has achieved a trade surplus for the first time in two decades, which helps create conditions to increase foreign currency reserves. Besides, tremendous opportunities are still waiting in the long run with the entrance of international players and the further investment of many current players in Vietnam market.

In terms of retail landscape, Street Shops still remains the most popular FMCG shopping place, but Modern Trade has surpassed Wet markets to become the second most popular channel. In urban 4 cities, Modern Trade has reached 18% of market value, with fast development at double digits year-on-year growth. Modern Trade also speeds up by attracting more rural households, though still very small in this area (2% market value). Today, 85% urban population and 24% of rural population go shopping at Modern Trade at least once per year.  

Vietnamese consumers are becoming more and more sophisticated. As consumers are now money rich yet time poor, they are seeking for Convenience in shopping and product usage. In addition, they are more concerned about Health issues, and willing to pay more for products that are good for health or offer added valued benefits. Not only that, Vietnamese consumers are looking forward to new product launches that can satisfy their needs betters. Hence, in the latest year, these 4 Vietnamese consumer trends are being reported by Kantar Worldpanel which are Speed and Convenience, Health and Wellness, From Basic to Added Value, and Innovation.

Vietnam Dairy Market – The milky opportunities

Driven by real demand, Vietnam dairy market has been shining within the SEA region. Even in tough economic conditions, the dairy market blossoms with double-digit growth in both Urban and Rural. Dairy plays the most important part in FMCG wallet of urban families, and grows the fastest in rural recently. In the next 3 years, Dairy is expected to become more essential for Vietnamese consumers, especially in Rural where it still stays the third position in the FMCG basket. Besides the increased health concern of Vietnamese consumers, the wider availability of fridges in-home will also help facilitate the development of this sector.

In such a turbulent market, the huge consumer base and high shopping traffic offer great opportunities for different dairy products to approach their consumers. Over 80% of urban households and half of rural families shop for Dairy every month. Like in many food products, Traditional Trade is crucial for Dairy, in which Street Shops account for two third of the market value. However, Hypermarkets and Supermarkets should not be ignored in Urban as being the second most popular shopping destination and obtaining faster growth rate, while Wet markets contribute over one third of the market value in Central and South Rural. When shopping for Dairy, Vietnamese consumers tend to combine with other FMCG products, especially packaged foods such as instant noodle, cooking oil and sugar. In addition, the mega bulky shop and up-trading trends are also practiced in Dairy by both urban and rural consumers. For instance, the consumers are shopping more packs of liquid milk and cup yogurt, or going for bigger pack sizes of milk powder in a shopping trip. More premium products with added-value benefits, such as fortified liquid milk, beauty cup yogurt or probiotic drinking yogurt, are attracting more and more shoppers as the consumer needs become diversified. Although households with kids are still core, mature families are emerging with higher demand for dairy, especially functional and specialized products.

While manufacturers observe great development potentials in various dairy categories, moving from mass to segmentation and understanding the changes in your target consumers’ needs and behaviours will be the key to success in Vietnam dairy market.

Dowloadable summary and other materials are available at the links on the right side of this page.

During the first quarter of 2013, GDP struggled to expand by +4.9% on a year-on-year basis, marking an improvement in growth rate compared to the same period in 2012, yet not strong enough to reverse the deceleration trend.

FMCG spending increased by +12% in Urban and +11% in Rural areas. Dairy and Beverages were the key drivers, recording +15% expansion in Urban and +18% in Rural. Besides, positive scores were also seen in Home Care sector at +16% growth in Rural. Rural consumers were adopting more and more household products to ease their housework. Table napkins, toilet cleaner and detergent were successfully expanding their presence in rural homes.

Street Shops and Wet Market remained the most important channels in Vietnam, making up over 60% of the FMCG market value. However, Modern Trade was gaining momentum over time. Interestingly, during the last quarter, Specialty Stores showed the most rapid growth among all channels in Urban Vietnam with a +25% increase in value compared with the same quarter last year, mainly driven by its growth in Dairy.

Fueled by a heavier consumption pattern among Urban consumers, Liquid Detergent shone as the star among FMCG categories with a remarkable +30% increase in volume compared with the same quarter last year. In Rural, an additional buyer base of 1 million households and an uplift at +6.6% of average volume consumption helped Carbondinated Soft Drinks achieve an exceptional volume growth of +31%.

Regarding consumer’s wallet share, according to the Expenditure Survey conducted by Kantar Worldpanel in late 2012, FMCG & Fresh Food remained an essential part (more than ¼) of household expenditure in both Urban and Rural. Beside FMCG & Fresh Food, Education and Savings played an important part of a typical Vietnamese wallet share. While urbanites saved the second biggest part of their budget for education, more provident rural counterparts placed a higher priority on agriculture investment and savings.

David Anjoubault, General Manager at Kantar Worldpanel Vietnam, concluded: “With no clear signs of economic recovery, consumers tend to rationalize towards basic needs. FMCG and Fresh Food stays the core in consumer’s wallet and even expands if compared with the previous year. Opportunities do exist, yet manufacturers need to be more responsive and provide more value-for-money offers to generate consumer interest and deepen their loyalty.”

The report highlights the opportunities for growth that exist, with only one brand in the world – Colgate – reaching more than half of the global population (65% penetration) with its oral care products.

Kantar Worldpanel’s Brand Footprint Ranking reveals the strength of brands in 32 countries around the world, across the food, beverage, health and beauty and homecare sectors. It uses an insightful new metric called Consumer Reach Points which measures – for the first time – how many households around the world are buying a brand (its penetration) and how often (the number of times shoppers acquire the brand).

This unique calculation of penetration and frequency helps FMCG manufacturers to clearly understand their global reach in terms of actual basket reach and provides a vital guide on which regions present the biggest opportunities.

The strongest global brands in the ranking have demonstrated their ability to understand and respond to local needs and reach the most remote consumers in rural areas of emerging markets by building larger distribution networks. However all of the brands still have plenty of room to recruit more shoppers in new geographies, new targets, new segments or on new occasions.

Josep Montserrat, Global CEO of Kantar Worldpanel, says “Now brands demand more in-depth analysis of their current basket reach compared to their competitors and opportunities for growth around the world. The Brand Footprint report provides this. As the pressure to maintain and increase growth intensifies for FMCG manufacturers, brand consumer base expansion and significant increase of loyalty is more critical than ever. Consumer Reach Points reveals which brands are already achieving global success and provides insight that will help other FMCG brands with international ambitions to set global targets more accurately and improve their global business growth.”

Find the top 10 global FMCG brands revealed by the Brand Footprint study clicking on the link to the right.

Other key highlights include:

• Thirteen Billionaire Brands – Thirteen global brands are chosen by consumers more than one billion times a year – Coca Cola, Colgate, Nescafe, Pepsi, Lifebuoy, Maggi, Pantene, Knorr, Lay’s, Dove, Lux, Palmolive and Tide. 
• Emerging markets drive 98% growth for the growing brands in the Top 50. Further, six of the top 10 brands in the ranking show significant increases in their growth driven by the emerging markets – Coca-Cola, Colgate, Dove, Maggi, Nescafe and Pepsi. Coca-Cola increased its growth in these territories by 7% gaining 230 million Consumer Reach Points.
• Dove top riser in ranking – no 10 in the global ranking, Dove grew its Consumer Reach Points by 18% to reach more than 1.1 billion. Other top risers are Tide, Vim, Oreo, Head & Shoulders and Bimbo.
• Global success doesn’t rely on being present in developed markets – The report reveals how a brand can achieve high penetration and sales without a high presence in developed markets. Japanese cooking seasoning brand Ajinomoto (no 19 in global ranking) for example reaches virtually no households in Europe and only 2.6% in the US. Tang, the most likely new entrant into the ‘billionaire club’ with its powdered drinks, is popular in emerging markets and the fourth biggest global beverage brand despite only reaching 13% of households.
• Some manufacturers grow global by acquiring local – Availability in some emerging markets remains a challenge for global brands, which is why some manufacturers, such as Heinz, chose to acquire local brands. Purchases by Heinz (no 26 in the ranking) have given it control of the world’s number one Worcestershire sauce brand Lea & Perrins, Brazilian tomato-based sauce Quero and China’s premium soy sauce Master Weijixian
• Globalisation is on the rise – Although international brand owners are driven by social- demographic and cultural trends, consumers often don’t differentiate between local and global brands. To achieve significant household penetration locally a global brand must know its consumers intimately and not impose the brand’s home culture on the local market. Colgate for instance achieves 86% penetration in India compared to 65% globally by having excellent urban and rural availability and by adapting to the local market with smaller pack sizes.
• Local brand giants – 23 local brands around the world achieve more than 500 million Consumer Reach Points: Roma, Tora Bika, Molto, So Klin, Energen, Sasa, Daia, Ekonomi and Sarimi in Indonesia; Lucky Me in the Philippines; Clinic Plus, Ghadi, Fair & Lovely and Tata Salt in India; Lala and Gamesa in Mexico; Wahaha, Shuanghui, Want Want and Bright in China; Almarai in Saudi Arabia and, finally, Oscar Meyer in the US and Warburtons in the UK. 

David Berry, commercial director at Kantar Worldpanel, explains: “Aldi and Lidl hold a combined 13.1% record share of the grocery market. Both retailers have succeeded in recruiting more shoppers while also encouraging existing customers to spend more. The average spend by a discounter shopper has increased from €187 last year to €209 in the same 12 week period this year.

“The winning performance of the discounters has placed significant competitive pressure on the other retailers. SuperValu has posted the strongest response with an extra 80,000 shoppers driving growth of 1.3% and keeping it ahead of the market. Superquinn is another positive performer for the Musgrave Group, recording sales growth for the second successive month.”

Meanwhile, growth for Dunnes Stores continues, albeit at a lower rate of 0.4% leading to a slight dip in market share to 22.5%. Tesco continues to perform behind the market with its share now standing at 27.7%.

David continues: “The rate of food price inflation has dropped from 5.7% last month to 5.3%. This will be a welcome boost for shoppers following the recent high of 5.8% in February. Fruit and vegetables have had the biggest impact on inflation with prices now increasing at a slower rate. Vegetable prices rose by over 13% last month and this has fallen back to 12.7%.”

An update on inflation

Grocery inflation stands at 5.3%* for the 12 week period ending 14 April 2013, down from the 5.7% seen last period.

*This figure is based on over 30,000 identical products compared year-on-year in the proportions purchased by Irish shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Read the previous report here.
Follow us on Twitter to get the latest updates here.

iOS remains the number two OS in Britain, but its share has declined by 1.4 percentage points to 28.9%. Windows Phone has now hit 7% market share for the first time, up from 2.9% a year ago.

Dominic Sunnebo, global consumer insight director at Kantar Worldpanel ComTech, comments: “Android is the top selling OS across key global markets, only beaten by iOS in Japan and now accounting for 93.5% of the Spanish market. We expect to see a further spike in its share in the coming months, as sales from the HTC One start coming through and the Samsung Galaxy S4 is launched. This will pile pressure on Apple, BlackBerry and Nokia to keep their products front of consumers’ minds in the midst of a Samsung and HTC marketing blitz.”

Samsung and Apple continue to dominate the top ten best-selling smartphones in Britain, with the LG Google Nexus 4 and BlackBerry Curve 9320 the only other individual brand models featuring.

Dominic continues: “Samsung already accounts for half of the ten bestselling smartphones in Britain and much has been said in the past about Samsung’s strong distribution, but it is clear that one of the key drivers of Samsung’s performance is how targeted each device is. Kantar Worldpanel ComTech data clearly shows that different Samsung models are appealing to a very different type of consumer.  The Galaxy Note II is popular with affluent 25-34 year old males, the Galaxy SIII Mini appeals to younger females, the Galaxy Ace to older females while the Galaxy SIII has broad appeal.  The fact that Samsung has so many models available in the market is not indicative of a scatter gun approach, simply a realisation that different consumers demand very different handsets, both in functionality, design and price.”

In the latest three months to March 2013 smartphone penetration in Britain remained at 63%, with smartphones making up 84% of mobile sales.

* 3 m/e March 2013

Find out more:

Read the previous Kantar Worldpanel Comtech report here.
Follow us on Twitter to get the latest updates here.
Discover more about Kantar Worldpanel ComTech here.

With nearly half (49.3%) of smartphone sales, Android remains the top selling operating system, but saw only slight growth compared to the same period last year, and is down versus the 3 months ending February 2013 (-1.9%). iOS remains in second place with 43.7% of smartphone sales, down throughout Q1 2013. Little movement is seen among the top smartphone carriers in the U.S market. Verizon continues to lead smartphone sales with 37.2% of smartphones sold in the 3 months ending March 2013. AT&T remains in second place at 27.9%, and Sprint in third place with 12.3%. T-Mobile is the only carrier to decline this period, seeing a 3.2% loss versus the same period a year ago, down to 9.5% of smartphones sold.

The data is derived from Kantar Worldpanel ComTech USA’s consumer panel, which is the largest continuous consumer research mobile phone panel of its kind in the world, conducting more than 240,000 interviews per year in the U.S. alone. ComTech tracks mobile phone behavior and the customer journey, including purchasing of phones, mobile phone bills/airtime, and source of purchase and phone usage. This data is exclusively focused on the sales within this 3 month period rather than market share figures. Sales shares exemplify more forward focused trends and should represent the market share for these brands in future.

Kantar Worldpanel ComTech analyst Mary-Ann Parlato states, “As iOS and Android continue to battle it out for top selling smartphone OS, we have seen Windows steadily grow over the past year and is now at its highest sales share figure so far.”

Windows share growth has continued to rise in European markets, particularly where Windows is supported by the legacy of its hardware partners. The US market differs in the fact that there are still many users in the market that are yet to upgrade to their first smartphone device. And Windows is starting to capture these consumers.

“Windows strength appears to be the ability to attract first time smartphone buyers, upgrading from a featurephone. Of those who changed their phone over the last year to a Windows smartphone, 52% had previously owned a featurephone. Comparatively, the majority of iOS and Android new customers were repeat smartphone buyers, with 55% of new iOS customers, and 51% of new Android customers coming from another smartphone. While the differences between these figures are small, with over half of the US market still owning a featurephone, it’s likely that many will upgrade over the coming year, which will ultimately contribute to more growth for the Windows brand.” Parlato continues.

One of Windows’ key handset manufacturers, Nokia, has seen the greatest benefit from the OS’ growth. Although, still only 4% of smartphones sold in Q1 2013, Nokia has seen its share rise from just 1% in the same period a year ago.

Find out more:

Read the previous US ComTech Press Release here.
Follow us on Twitter to get the latest updates here.
Discover more about Kantar Worldpanel ComTech here.

The FMCG market slowdown was observed across all regions and city tiers, particularly in the key cities (Beijing, Shanghai, Guangzhou, Chengdu) where growth was only 5.6% in the first three months over previous year, and in the West and North region, where growth was only 7.5% and 7.2% respectively.

Jason Yu, General Manager at Kantar Worldpanel, explains: ‘The latest grocery numbers show that household spending in China was less resilient than many expected, even if we discount the impact of inflation. With the rise of ecommerce and growing cost of business, bricks-and-mortar retailers will have to put more effort to grow basket size in existing geographies while expanding cautiously to new locations.’

RT-Mart growing its lead over Wal-mart Group
Sun-art Group, the largest grocery retailing group in China, continued its lead in Q1, 2013, reporting 8.3% share of total modern trade, 1.5 points over its nearest rival Walmart group. RT-Mart, which registered a record share of 6.9% for a single banner in the latest 3 months, was the key driving force in the group. The growth was particularly strong in key cities and provincial capitals as well as counties, while the performance in prefecture level cities and county level cities was stable.

With a total of 219 stores in 2012 and approximately 70% of the stores located in prefecture level cities and below, RT-Mart managed to grow its store number and its sales at the same time. Kantar Worldpanel data suggested that in the latest 12 months, the average RT-Mart shopper spent 1,087RMB on FMCG products in the store, a staggering 28% higher than that of the average Wal-mart shopper.

Yonghui is yet to make further breakthrough in share
Local retailers as a group continued their advance in modern trade, growing from 71.9% to 72.3% collectively year on year. Yonghui was a star performer, rapidly catching up with Tesco, with a value share of 2% in the latest 12 months. Yet Yonghui failed to grow further in the past few quarters. Despite its continued expansion in the North region, Yonghui didn’t maintain its position in the South, its home region, where it faces growing competition from RT-Mart and Tesco.

With its rapid geographic expansion, Yonghui reached 4.6% families in urban China in Q1 2013, while last year they only served 3.9% families. Yet the retailer also reported 5.5% growth in spend per family in the latest quarter compared to last year, suggesting that retailer’s ability to attract consumer spending wasn’t diluted by the expansion of its customer base.

It is important for bricks-and-mortar retailers to realize that the ecommerce channel continued its growth in the first 3 months of 2013, particularly in the key cities where its share reached 3.4% value share in FMCG in Q1.

The latest grocery share figures from Kantar Worldpanel UK, published today for the 12 weeks ending 14 April 2013, show an increasingly polarised grocery market as Waitrose, Aldi and Lidl all posted record market shares.

Edward Garner, director at Kantar Worldpanel, explains: “Aldi has set two records in the latest period, with its highest ever growth of 31.1% delivering a record market share of 3.4%. Lidl’s market share of 3.0% is also an all-time high for the retailer.

“Pressure on household budgets is undoubtedly driving some of the growth at the discounters, but messages about quality are starting to resonate. Lidl announced this week that it will increase its fresh meat and poultry floorspace by 50% within the year, and Aldi’s new ‘convenience’ store in Kilburn is a departure from its traditional edge-of-town offering. These changes are likely to appeal to a new and different group of shoppers which will bolster the performance of the discounters even further.”

Meanwhile, the strong performance of Waitrose has continued, leading to a record share of 4.9%. Shoppers rate Waitrose highly in terms of provenance and clearly-defined supply chains – important credentials in the wake of the horsemeat scandal and factors which have clearly boosted sales at the retailer.

Within the big four, Sainsbury’s has again delivered the strongest growth with 5.4% and is the only one to increase market share, now at 16.9%. Tesco’s market share currently stands at 29.9%, Asda’s at 17.5% and Morrisons’ at 11.5%.

An update on inflation

Grocery inflation stands at 3.8%* for the 12 week period ending 14 April 2013. This is a fall from the 4.2% in our last report and is now only slightly higher than the market growth of 3.6%. This represents a welcome respite in the pressure on household budgets.

*This figure is based on over 75,000 identical products compared year-on-year in the proportions purchased by British shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Watch the previous commentary here.

Fiona Keenan, consumer insight director at Kantar Worldpanel, explains: “The supermarkets have had a really strong first quarter, driven predominantly by the huge success of Skyfall. It was undoubtedly going to be the biggest title of the year and the grocers made sure they were the number one choice for consumers. Their aggressive pricing and large advertising campaigns lead to them taking over 80% of its sales to date.”

Elsewhere, HMV has performed relatively well over the past 12 weeks, which will be good news for its new owners. It now accounts for 17.6% of the market, only dropping one percentage point when compared with its share in the final quarter of 2012*.

Fiona adds: “There is still work to be done for HMV, particularly when we look at its decline over the past year and the growing dominance of its rivals. The growth of digital music has played an important part in its performance. Sales of digital music grew by 12% in quarter one compared with the same period last year and now account for almost half (47%) of all music purchases. Amazon has been fast to react to this trend, making it the largest music retailer and helping to push up its overall share within entertainment by 2.9 percentage points. HMV will need to act quickly to regain some of this market.

“One potential stumbling block for the ever dominant Amazon is the games market, where Game continues to dominate and is the biggest retailer. Although its market share has dropped at a total entertainment level, this is mainly as a result of video games making up a smaller share of the wider entertainment market. When we look just within the games market the retailer is performing strongly and is well placed to pick up any HMV games customers that may be looking elsewhere.”

* 12 week ending 23 December 2012

Figures from the General Statistics Office show an ease on inflation pressure as domestic consumption struggles to rebound after the credit slowdown. Despite the overal lagging demand, the FMCG market has surged by 15% in Urban and 9% in Rural over the last three months compared to a year ago in terms of value.

Obviously, FMCG market sees the leading growth of Tet’s favoured sectors including Packaged Foods, Home Care and, especially, Beverages, which enjoys a spectacular growth of over 17% across the country compared with the same period last year. Tet is actually the peak moment of consumer spending in Vietnam. During this time of the year, the Vietnamese delight their relatives and friends by offering spring flowers, fruits or baskets of purchased goods including coffee, tea, soft drinks, candies, chocolates, biscuits, fruit juice or even alcohol. David Anjoubault, General Manager at Kantar Worldpanel, comments: “With its special role in Vietnamese culture, Tet plays as a seasonal momentum to boost up a spectacular spending spree across the country. Tet 2013 sees the uplift in consumer spending in preparation for Tet starting from 4 weeks before the first day of the lunar new year, in both Urban and Rural. Grasping this opportunity to speed up would bring worthy rewards to manufacturers and retailers.”

During this quarter, Kantar Worldpanel notices the rapid expansion of Instant Coffee and Biscuits. In Urban, Instant Coffee lifts up by 21% compared to the same period last year in terms of volume thanks to an incremental of 112,000 new household buyers and a 5.6% increase in household consumption. In Rural, Biscuits witnesses outstanding growth at 29%, attracting more than 1 million new buyers and increasing household volume consumption by 11%.

Amid the race for shoppers among different channels, Street Shops is still the key shopping destination in both Urban and rural. Interestingly, Modern Trade enjoys a rapid two-digit growth, mostly thanks to the expansion of hyper/supermarkets, directly impacting wet market. Shifting from Traditional Trade towards Modern Trade was continuously observed among Vietnamese shoppers, especially in Urban areas.

David Berry, commercial director at Kantar Worldpanel, explains: “Things have started to look up for both Superquinn and the grocery market as a whole. The 1.9% sales growth posted by the retailer is good news, particularly as it is the first time it has beaten the market, which is currently growing at 1.5%, since 2007. This growth has been driven by people buying more items each time they shop at Superquinn, with fresh and chilled foods proving particularly popular.

“Discount supermarkets Aldi and Lidl are continuing to perform well, growing at 30.7% and 5.8% respectively, matching their highest ever combined market share of 12.6%.”

Meanwhile, growth at Dunnes and Tesco has continued to stall. Falling back from a peak of 4.6% in January, Dunnes has posted growth of 1.4%. Despite this, the retailer has managed to maintain growth by increasing the amount its shoppers are buying each time they visit. Tesco has performed behind the market for the third consecutive month and now sees its sales declining by 1.3%.

The grocery market continues to move on an upwards curve, from growth of 0.3% in December, 0.6% in February, to 1.5% in March. Shoppers are buying fewer items compared with last year but are spending on average €18.20 more, a trend driven mainly by the high rate of inflation.

An update on inflation

Grocery inflation stands at 5.7%* for the 12 week period ending 17 March 2013, down slightly from the 5.8% seen last period.

*This figure is based on over 30,000 identical products compared year-on-year in the proportions purchased by Irish shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Read the previous report here.
Follow us on Twitter to get the latest updates here.

With more than half (51.2%) of smartphone sales, Android realized 5.8% growth compared to the same period last year. iOS remains in second place with 43.5% of smartphone sales, down for a consecutive period, by 3.5% versus last year. Windows continued to make gains, up to 4.1% of smartphone sales.

The top carrier remained Verizon with 35% of smartphones sold in the 3 months ending February 2013. While AT&T remained in second place, Sprint increased, now representing 15% of smartphones sold (up 2.1% pts).

The data is derived from Kantar Worldpanel ComTech USA’s consumer panel, which is the largest continuous consumer research mobile phone panel of its kind in the world, conducting more than 240,000 interviews per year in the U.S. alone. ComTech tracks mobile phone behavior and the customer journey, including purchasing of phones, mobile phone bills/airtime, and source of purchase and phone usage. This data is exclusively focused on the sales within this 3 month period rather than market share figures. Sales shares exemplify more forward focused trends and should represent the market share for these brands in future.

Kantar Worldpanel ComTech analyst Mary-Ann Parlato states, “Last month we saw that Android’s increases were thanks to a large increase in Samsung sales within Sprint. This month, while the increases for Samsung are less pronounced, we’re still seeing an increase in uptake of the brand, which is now impacting on Sprint’s overall share in smartphone sales.”

It was thanks to Samsung’s price drop at the back end of 2012 that led various smartphone and featurephone users to upgrade to a Samsung device.

“Of those who changed their phone over the last year to a Samsung smartphone, 19% had previously owned a Samsung featurephone, 15% owned a HTC smartphone, 14% owned an LG featurephone, 10% owned a Samsung smartphone and 9% owned a BlackBerry. It’s apparent that Samsung is successful at capturing users from across the competitor set and not just gaining from their own loyalists, (albeit loyalty towards Samsung has also grown).” Parlato continues.

And naturally, it was the figurehead Samsung devices doing well during this period. Of those who purchased a Samsung in the last year, 52% purchased a Galaxy S III, 21% a Galaxy S II and 5% a Galaxy Note II. And compared to purchasers of other brands, Samsung purchasers were more likely to cite “handset cost” and “carrier brand” as key drivers.

So while price drops on Sprint have helped the carrier, as well as Samsung and Android gain further success this 3 month ending period, share growth for other brands was also more pronounced this month. Brands Motorola and Nokia in particular saw very slight increases within smartphone sales.

Find out more:

Read the previous US ComTech Press Release here.
Follow us on Twitter to get the latest updates here.
Discover more about Kantar Worldpanel ComTech here. 

Dominic Sunnebo, global consumer insight director at Kantar Worldpanel ComTech, explains: “Over the past few months, there have been signs of a more competitive manufacturer dynamic. LG’s share of the market has grown by +4% year on year and HTC’s share (9.1%) is beginning to edge up again – its refreshed HTC One X+ and HTC 8S are selling well, confirming its position as the third largest smartphone manufacturer in Great Britain.”

Nokia has also seen share gains over the year and holds 5.6% of the market – this is now being driven by its Windows 8 devices appealing to consumers, rather than sales of older Windows 7 models on promotion, which is good news for margins. However, Samsung remains the top smartphone brand in Great Britain with 36.2% and Apple in second position with 29.0% share of sales in the three months to February.

Sunnebo continues: “The launch of the BlackBerry Z10 has not resulted in an immediate turn around for the Canadian company in Great Britain. Although the new model received great reviews, it’s going to take time for BlackBerry to see share gains. Consumers just don’t have the same levels of pent up demand for the handset as they did for the iPhone 5.

“Over the past few years it has been BlackBerry’s budget devices, like the Curve 8520 and 9320, which have been selling well and these attract a young, price sensitive consumer. The Z10 is a high-end handset with a price to match, so going after its existing base of consumers will require a significant trade up. The handset is likely to start selling in more serious numbers once the launch price falls, and BlackBerry 10 in general, when the range is padded out with a number of wallet-friendly mid-range offerings.”

Android continues to hold the number one OS spot in Great Britain with 58.3% in the latest period*, up from 48.3% a year ago. iOS also edges up to 29% share. Windows Phone progress continues, with its smartphone sales share hitting 6.7% in Great Britain, up from 3% the previous year.

In the latest period, smartphone penetration reached 63% in Great Britain, with smartphones making up 83% of mobile sales.

Round the World

Strong sales of the iPhone 5 in tier one Chinese cities Beijing, Shanghai and Chongqing have helped Apple perform strongly in the world’s largest smartphone market with 25.8% share of the urban Chinese market. Samsung remains the top manufacturer in urban China holding 28.2% share of the market with Lenovo in third position (9.3%).

In the US the smartphone market remains dominated by iOS and Android, with a combined share of 94.7%, but Windows Phone has finally broken through the 4% share mark driven by the flagship Nokia Lumia 920.

*3 m/e Feb 2013

Find out more:

Read the previous Kantar Worldpanel Comtech report here.
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The latest grocery share figures from Kantar Worldpanel, published today for the 12 weeks ending 17 March 2013, show Sainsbury’s is the clear winner among the big four while elsewhere Waitrose and Aldi record the two highest percentage growth rates this period.

Fraser McKevitt, retail analyst at Kantar Worldpanel, explains: “Sainsbury’s year-on-year growth of 6.2% firmly beats the total market growth of 3.9%. Since 2004, its annual share has been on a rising trend and now stands at 16.8% for the 52 weeks ending 17 March.”

Market polarisation continues unabated with Waitrose and Aldi holding on to the record shares reported last month. Fraser continues: “Austerity and provenance are the key factors behind the varying retailer performances this month. Continued pressure on household budgets has helped Aldi, Lidl and Iceland to record market beating growths while Waitrose and Sainsbury’s have managed to mostly avoid adverse media coverage from the horsemeat scandal.”

Elsewhere in the big four, Asda holds on to the record share of 17.9% it achieved a year ago but there are share drops for Tesco and Morrisons.

Fraser continues: “Looking ahead, Tesco has responded with its Price Promise promotion which delivers coupons to shoppers at the tills and Morrisons has announced plans to plug its home-delivery gap during 2013. These strategies are expected to help boost the retailers’ performances going forward.”

An update on inflation

Grocery inflation stands at 4.2%* for the 12 week period ending 17 March 2013. This remains higher than the market growth of 3.9% and reflects shoppers’ coping mechanisms such as switching products and retailers and seeking out offers.

*This figure is based on over 75,000 identical products compared year-on-year in the proportions purchased by British shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers

Watch the previous commentary here.

All data in this edition runs up to Quarter 4 2012 and is sourced from Worldpanel network across Asia.

Key findings:

#GreenLightsAbound FMCG trend remains positive, with faster growth pace in China and Vietnam
#E-commerceBoom online shopping for FMCG items becoming more popular across region, led by Korea
#TwoSectors Beverages and Personal care the two baskets with growth above 5% in all countries
#LocalRetailersUp Don´t underestimate local Supers & Hypers, they are developing fast!

The Great Place to Work Institute France has revealed the 2013 list of Best Workplaces, a yearly award that recognizes the best companies to work for in France. This year for the first time, Kantar Worldpanel has been listed in the prestigious ranking in 21st position in the category of Less than 500 Employees.

Patrick Dumoulin, General Director of Great Place to Work France said of the award “This is the first time that Kantar Worldpanel has taken part in the listing of the Top Companies to Work For and it has been classified in the 21st position… The award highlights the strength of management and how accessible the leadership team is to its employees.’ He continued ’… In the ranking we place great importance on transparency as well as human relations and supporting employees. We welcome Kantar Worldpanel to the Best Workplaces France 2013!”

For more information about the Great Place to Work Institute click here.

David Berry, commercial director at Kantar Worldpanel, explains: “The impact of the horsemeat issue has so far only affected what consumers put in their baskets rather than where they do their shopping. For the four weeks ending 17 February frozen burger sales were down by 42% as shoppers chose to buy alternative meals.

“Aldi continues to set the pace with sales growth of 29%, increasing its share of the market from 4.6% last year to 5.9%. What is notable from Aldi’s performance is that it has grown sales of fruit and vegetables – the most valuable grocery category – by 39% this year

“Among the big three supermarkets Dunnes is the only grocer to increase its share of the market. Benefitting from bigger shopping baskets, the retailer beat the market with 4.1% sales growth. Tesco’s performance has improved slightly since January but still remains behind the market, leading to a drop in market share for the second successive period.”

The 0.8% growth seen in the market is the highest level since December 2011 and is attributable to the continued increase in the price of groceries.

An update on inflation

Grocery inflation stands at 5.8%* for the 12 week period ending 17 February 2013, the highest level seen since the 6.2% seen in September 2008.

*This figure is based on over 30,000 identical products compared year-on-year in the proportions purchased by Irish shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Read the previous report here.
Follow us on Twitter to get the latest updates here.

The company, which specialises in consumer and shopper insights and has the largest continuous panel in Great Britain, was listed 81st in the ranking of 100 companies.

Best Companies surveys employees to measure several areas of employee engagement including the leadership team, employee well-being, community involvement, employee personal growth, and day-to-day management. Key to Kantar Worldpanel’s success in this year’s list is that employees have great confidence in the senior management team and feel inspired by Managing Director Tim Kidd who they describe as a ‘bright, caring and engaged leader’. The commitment the business shows to giving back to the local community is also important and 77% of staff think the company has a strong social conscience.

Tim Kidd, managing director at Kantar Worldpanel UK, Ireland and USA, comments: “This recognition is a great achievement. It reflects the exceptionally positive engagement of our employees and also helps in our ambition to be a ‘go to’ employer.

“Our industry is no longer just about providing the data. Clients need analysis, interpretation and strategic guidance to help them grow their business. This requires good people. We have been working hard to make our company a place people really want to work and we’re pleased to see we’re succeeding.”

For more information please contact Suzannah Rowland on 02089671663 or email Suzannah.rowland@kantarworldpanel.com

Although China’s economy is among the brightest performers within emerging markets in 2012, consumption is yet to play a pivotal role in GDP. With the new government pledging to carry out more reforms to increase wage and address wealth distribution, the pick-up of spending power will inevitably reflect the rebalancing of the Chinese economy away from exports and towards consumption.

It is vital for category leaders to consider category spending as a key success factor to drive future growth in the retail market, especially mature categories whose penetration has reached a plateau, such as biscuit and chocolate in food and toothpaste and toothbrush in toiletry. In 2012, there were a number of categories showing substantial increase in household spend level, including mint candies, wine/spirits, chocolate, biscuits and toothbrush.

Mature Categories—Smart Shopping and Innovation Seeking

Kantar Worldpanel’s continuous tracking of 40,000 urban Chinese families throughout 2012 shows that Chinese consumers continue to spend more on mature categories such as toothpaste, despite the category penetration being stable over the last two years.

For example, average families spent 12.5% more on toothpaste. The premium segment, especially products with professional and special claims, such as whitening, anti-sensitivity, and gum-protection, became more attractive to consumers and thus is driving the category expansion. 

Similar to oral care categories, biscuit has also reached 98% household penetration in urban China which leaves very little room to further expand penetration. Nevertheless, the biscuit category still enjoyed 23% market growth in 2012 thanks to the increase of consumption level. On the one hand, premium European biscuit for gifting has been one driving factor of the consumption growth. On the other hand, new flavours and innovative product formats are another success factor leading to the market expansion.  In order to secure space in consumers’ baskets, premiumization as a result of driving innovation that really uncover new consumer demand and changing lifestyle are inevitable to justify value-for-money. 

Emerging Categories— Market Development by Creating New Needs

Unlike mature categories, emerging categories should take totally different approaches to grow consumption. Let’s take the coffee market for example: Kantar Worldpanel observes that less than 40% of the Chinese families bought coffee in 2012, which was still a lot lower than other more developed markets, e.g. 58% in Taiwan. This indicates that consumers in China market are still in the developing stage of the coffee drinking habit.  However, there are differences by different city tiers. Consumers in key cities generally have higher accessibility and higher acceptance toward innovative concepts and products while consumers in lower tier cities are followers and more reluctant to change.

As a result, for emerging categories, cultivating usage habits through innovative and premium products would be important for key cities, whereas overcoming barriers to trial and arousing interest in first trial would be more relevant for lower tier cities.  Marketers for emerging categories will have to take a tiered strategy for product development.

The Race for Buyers in 2012 - Winners and Losers

Although most categories still grew by using a combination of shopper base expansion and spending level growth, thanks to urbanization and market developments, 90% of the FMCG categories reported a noticeable increase in buyer base and leading players benefited more from the race for consumer acquisition.

Total 2012 data suggested that there were 15 FMCG players in China who reached over 100 million urban families and the top of the table continues to be dominated by P&G, COFCO3 and Master Kong4. All 3 have managed to extend their buyer base, demonstrating that even the giants have room to grow.

Many of the successful manufacturers mentioned in the report have continued their push in the final quarter of 2012, especially Mondelez, President and Mars. All 3 star players in 2012 have outperformed in the lower tier cities, reducing the gap in terms of consumers reached in the low tier cities compared with the more developed high tier cities and growing their customer base in the grocery channel, especially President who has a higher penetration in the traditional trade compared to hypermarkets and supermarkets.

In a local player battle that’s playing out, Want Want has overtaken Liby in terms of consumer reach on an annual basis, helped by a surge in buyers for its snacks and confectionary products and increased recruitment in hypermarkets. Another local player, Wahaha, has managed to gain significant buyers in the juice category, but at the same time, lost buyers of its ready to drink tea and its yogurt products, leading to an overall decline in its buyer base, with much of the loss coming from the modern trade and in top tier cities where multinational competitors have managed to strike back.

As per Kantar Worldpanel Vietnam, in 2012, an urban* Vietnamese household spent on average around VND 1,080,000 monthly for fast moving consumer goods (FMCG, including packaged food and non-food goods). Their expenditure during the Tet month reached around VND 2,000,000, almost double - just on FMCG categories. The important role of Tet is also noticeable in rural, where consumers doubled their spending from VND 500,000 monthly to VND 1,000,000 during Tet month.

Tet’s hottest FMCG items as witnessed by Kantar Worldpanel Vietnam

The growth in Tet consumption is mainly driven by sectors such as confectionary, soft drinks and cooking additives. During this time of the year, the Vietnamese delight their relatives and friends by offering spring flowers, fruits or baskets of purchased goods including coffee, tea, soft drinks, candies, chocolates, biscuits, cashew nuts or even alcohol. Therefore, CSD, Beer, Candy, Biscuits, and Tea are among the top ten growth categories in both rural and urban.

The beverage sector is the key beneficiary of the spending spree brought on by Tet gift-giving, particularly in ‘cans’, ‘boxes’ or premium presentations. CSD is the top growth category in the beverage sector in Tet 2012 in both urban and rural, which performed an increase of over 500% in sales volume in urban and more than 700% in rural, attracting an incremental of 700 thousand urban households and 3.4 million rural households as noticed by Kantar Worldpanel Vietnam.

There is a slight difference between urban and rural households during Tet in terms of beverage consumption. Urban consumers seem to prefer fruit juice and instant tea; whereas rural consumers increase their consumption more for convenient drinks such as RTD tea and energy drink and show more preference towards coffee.

Tet is also the right time for alcohol consumption in both urban and rural. Beer stands at the seventh position in terms of volume growth during Tet in urban with 263% volume increase versus normal month, while in rural, beer is the fifth growing category with 249% volume increase, attracting an expansion of more than 600,000 urban households and 5 million rural households. Interestingly, not only beer, liquor also appears among the top ten growth category during Tet in Rural, with an increase of nearly 100% in terms of in-home volume consumption.

Candies and Biscuits are also among popular categories in terms of gift-giving during Tet, which attracted a huge number of new buyers in both urban and rural in Tet 2012. Candy in rural is an extreme case of the significant uplift in volume consumption during Tet, at more than 1500% - far more than in urban. Chocolate, although not being among the top growth categories in rural probably due to the question of price, is the third in terms of volume sales growth in urban (352% increase), showing a strong preference towards chocolate consumption and gift-giving of urban households during Tet.

Besides beverages and confectionary, cooking additives also enjoy great uplift during Tet. For instance, volume sales of vinegar and MSG grew by 206% and 136%, respectively, in urban, while chilli sauce had an uplift of 118% in rural in Tet 2012.

Most of top growth categories belong to the Food sector, yet we can also witness the appearance of 2 non-food categories in the list of hottest items during Tet: Box tissue in urban and Fabric softener in rural. In the future, it is expected that home cleaning and paper products will enjoy higher growth during Tet as these products offer convenience to simplify the housewives’ tasks and ways to make themselves and their homes more attractive.

In a nutshell, to consumers, Tet is a special time for celebration, consumption and spending in both urban and rural ofVietnam. To manufacturers and retailers, Tet is the right time to speed up the growth of the business, by taking advantage of the impact of Tet on consumerism inVietnam.

(*): Urban 4 Key Cities: HCM, Hanoi, Danang, Cantho

Edward Garner, director at Kantar Worldpanel, explains: “The issue has so far only affected the performance of individual markets rather than where consumers are choosing to shop. For the four weeks ending 17 February, frozen burger sales were down by 43% and frozen ready meals declined by 13%, clearly demonstrating a change in shopping habits.

“Tesco’s share has come under pressure this period, with a drop from 30.1% a year ago to 29.7% now. It might seem natural to attribute this decline to the horsemeat contamination; however, Tesco undertook heavy promotions this time last year, where consumers received a £5 voucher when they spent £40, and not repeating this offer will have adversely affected its share.”

Within the big four, Sainsbury’s is the only retailer to increase share this period, beating the market with a 4.6% growth rate. Morrisons is the only retailer to post a sales decline.

Edward continues: “Waitrose and Aldi deliver all-time record shares this period of 4.8% and 3.3% respectively indicating that market polarisation and the ‘two nations’ consumer climate continues. Iceland records 10.1% growth confirming that the frozen food category as a whole remains robust.”

The total grocery market is growing at an annual rate of 3.7% which lags behind grocery price inflation of 4.3%. This confirms the continued pressure on shoppers who are using coping strategies to reduce their personal inflation rate.

Please note the video commentary refers to12 w/e 17th February 2013 – not 17th January 2013 as stated in the video

Watch the previous commentary here.

iOS was second during the period with 45.9% of smartphone sales, down 4.7% versus last year. Windows continues to make gains, up to 3.2% of smartphone sales.

Top carrier rankings have also shifted with Verizon regaining its top spot with 35.2% smartphones sold in the 3 months ending January 2013. AT&T falls to second with 28.2% of smartphone sales. Sprint maintains third position with 14.2% share.

The data is derived from Kantar Worldpanel ComTech USA’s consumer panel, which is the largest continuous consumer research mobile phone panel of its kind in the world, conducting more than 240,000 interviews per year in the U.S. alone. ComTech tracks mobile phone behavior and the customer journey, including purchasing of phones, mobile phone bills/airtime, and source of purchase and phone usage. This data is exclusively focused on the sales within this 3 month period rather than market share figures. Sales shares exemplify more forward focused trends and should represent the market share for these brands in future.

Kantar Worldpanel ComTech analyst Mary-Ann Parlato states, “Part of Android’s increase in the latest period can be attributed to its large gain in share within Sprint’s smartphone sales. In the three month period ending October 2012, sales on Sprint were divided almost 50/50 between Android and iOS. However, in the latest period, Android’s share of Sprint sales increased by 22.6% points from 49.3% to 71.9%.”

Average prices paid for Android smartphones on Sprint have also declined over the latest period.

“The 50/50 split we saw in the period ending October 2012 was a result of both iOS and Android sharing similar levels of average price paid (iOS at $130 and Android at $127).Yet this latest period saw a significant price drop to $95 for Android, while iOS increased slightly to $146,” continues Parlato.

One particular phone that led to Android’s gains at Sprint was the Samsung Galaxy SIII, Samsung’s flagship model launched in mid-2012. While this model only captured 14% of smartphones sold at Sprint in the October period, a price drop from $199 to $99 over the holiday season led to the SIII gaining 39% of smartphone sales on Sprint. On T-Mobile, the only other major carrier where Android consistently is the top selling platform, the SIII represented just 18% of smartphone sales in the latest period.

Samsung smartphones represented 60.3% of smartphones sold on Sprint in the January period.Unfortunately for Sprint, the gains made by Android and Samsung did not translate into a large sales growth for Sprint, gaining only 0.8% year on year.

Find out more:

Read the previous US ComTech Press Release here.
Follow us on Twitter to get the latest updates here.
Discover more about Kantar Worldpanel ComTech here.

In the three months to January 2013* Windows’ share of the smartphone market has grown to over 6% in Great Britain, up from 2.4% the previous year, and 14.0% in Italy.

Although iOS and Android continue to take the lion’s share of smartphone sales in Great Britain, accounting for 30.6% and 56.2% of purchases in the latest data, Windows phones are now selling in significant quantities.

Dominic Sunnebo, global consumer insight director at Kantar Worldpanel ComTech, explains: “Nokia is spearheading this growth, with the Lumia 800 the leader among the Windows handsets. However, it is not the only manufacturer benefitting from the increasing popularity of Windows. HTC’s 8X is now the third bestselling Windows device in Great Britain, demonstrating the clear cross-manufacturer opportunity of the platform.

“With Windows now holding respectable market shares across most major European countries, a key question is who is losing out? In Great Britain, 17% of new Windows customers switched from Android, 26% from Symbian, 6% from RIM and just 2% from iOS. 47% were first time smartphone buyers.

“Understanding the source of growth for the Windows platform is crucial to devise and implement the right marketing and sales strategy. The fact that nearly one in five new customers switched from an Android device should give Microsoft, and its partners, confidence that its OS has what it takes to bring the fight to more established platforms. As almost 30% of its customers switch from rival OS’s, the worry that Microsoft will have to rely on attracting the dwindling pool of first time smartphone buyers to drive future growth is reduced.”

Samsung continues to be the number one smartphone brand in Great Britain with 36.8% share of smartphone sales in the latest three months to January, followed by Apple and HTC.

British smartphone penetration has now reached 62%, with smartphones making up 83% of mobile sales.

*three m/e January 2013

Find out more:

Read the previous Kantar Worldpanel Comtech report here.
Follow us on Twitter to get the latest updates here.
Discover more about Kantar Worldpanel ComTech here.

Only local retailers gaining share within Top 10 during 2012

Over 2012 many of the top 10 retail groups or banners struggled to grow share with only Zhongbai, Yonghui and BuBu Gao seeing share growth, all of which are local Chinese retailers. This increased competition from the local retailers has meant the share of modern trade that international retailers account for has decreased from 29% to 27% across all city tiers including the top 4 cities where the international retailers have historically been more dominant.

The Q4 share movements do show a more positive story particularly for the Sun Art Group and Carrefour. However, the Wal-Mart group sees a similar picture to the annual movement with a 0.8ppt drop. Yonghui success story continued in the fourth quarter reaching a share high of 4.3% in the West region as well as further traction gained in the North as a result of new store openings in Beijing.

Local retailers will continue to put the international players under pressure in 2013

Many local retailers have had a successful 2012 gaining share from the more dominant international players within modern trade. Bu Bu Gao (or to use its English name: Better Life) is one such case. Starting from Xiangtan, Hunan province in 1995 the retailer expanded its operations within the Hunan and Jiangxi provinces and now has approximately 241 stores. Bu Bu Gao has a multi-format approach offering hypermarket, supermarket and convenience store formats as well as electronic and apparel specialist stores. This sets it apart from many of the key players who tend to focus more on hypermarket or supermarket formats. Kantar Worldpanel reports a value share of 28% in Hunan province for Bu Bu Gao and the retailer attracted 56% of shoppers in this province during 2012. As local retailers such as Bu Bu Gao and Yonghui continue to grow their footprint within China we will expect to see them become even more competitive with the international players during 2013.

What trends can we expect to see during 2013?

Aside from the continued expansion from the local retailers there are a number of other key trends Kantar Worldpanel predicts for 2013.

• Firstly, e-commerce will continue to grow well ahead of total trade as more individuals have internet access through multiple devices as well as internet suppliers widening their supply chain network. During 2012 this channel saw an increase penetration, from 18% to 25%, as well as shoppers adding more categories to their repertoire. In 2011 shoppers purchased on average 3.2 different categories on-line and this increased to 3.7 in 2012. Traditionally this channel has mainly be used by younger more affluent households but this profile will shift as more older less affluent households start to use e-commerce. During 2012 the value growth of e-commerce amongst older singles/couples was faster than amongst all households at 68%.
• Lower tier cities will continue to fuel growth within FMCG as both local and international retailers expand their operations. During 2012 the value of modern trade in China’s county level cities grew at 15% compared to 10% in the top 4 cities. Also, China’s Tier 3, 4 and 5 cities combined contributed 66% of the total value growth in National Urban China.
• Shoppers will have a wider channel repertoire sourcing their FMCG products from a number of different channels. This is driven by the growing importance of chained specialist stores which sell a limited number of categories such as cosmetics, baby products or personal care items. These stores offer a wider range of products along with more specialised customer service compared to the hypermarkets.
• A shift of focus from expansion to store productivity. Many of the top hypermarket chains have continued to open many new stores in 2012 but without the reward of market share gain. In many cases low store productivity has been the cause of this so in 2013 we can expect to see the big players focus more on maximising the efficiency of their existing stores rather than rapid expansion into new cities.
• Premiumisation within many FMCG categories will continue as manufacturers expand their portfolio offering new products with unique benefits or multiple benefits. Modern trade retailers should use premium categories and products to increase basket value and offer shoppers a more extensive range. This will also allow them to remain competitive with department and specialist stores where premium products take a greater share of shelf.

David Berry, commercial director at Kantar Worldpanel, explains: “4.6% sales growth is Dunnes’ strongest performance for four years and highlights the success of the ‘Shop and Save’ campaign launched in the run up to Christmas. Shoppers have responded well to this offer, picking up more items every time they shop and increasing the average size of their baskets by almost €3 to €36.70 – an increase of 9%. This has opened a considerable gap between Dunnes and its competition, with the average Tesco and SuperValu shop standing at €30.40 and €22.40 respectively.

“Its consistent performance also stands out, with strong sales across a range of grocery aisles including fresh produce, alcohol, soft drinks, crisps and also chilled convenience food.

“Tesco has seen its share of the grocery market dip by half a percentage point this year, moving from 28.1% to 27.6%. Its sales growth has also declined by 1%. This is the first time Tesco has dropped behind grocery market growth since October 2009, demonstrating the success of the retailer up until now. One opportunity for it to get back on track is to build on the increasing number of trips to its stores which we have seen in recent months and get customers spending more.”

Elsewhere, Aldi continues to set the pace as the retailer enjoys the strongest level of growth, albeit slightly below its previous rate of 30%.

An update on inflation

Grocery inflation stands at 5.2%* for the 12 week period ending 20 January 2013, ahead of the 5.0% in the previous period and the highest since the 5.6% seen in May 2011.

*This figure is based on over 30,000 identical products compared year-on-year in the proportions purchased by Irish shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Read the previous report here.
Follow us on Twitter to get the latest updates here.

When we talk about consumers in the world of fast-moving consumer goods (FMCG), different consumer segments pose different opportunities for manufacturers, and this holds true even in mature categories like detergents and shampoo. Consumers differ in many ways, such as in their purchasing behavior, their attitudes and their levels of affluence. In order for manufacturers to identify potential in the categories they are operating in, and to subsequently develop good corresponding strategies and tactics, a good starting point is to put consumers into buckets based on their purchasing behavior.

Let’s take a mature FMCG category like shampoo. Did you know that based on household panel research carried out by Kantar Worldpanel Indonesia, urban households in this country purchase on average 1.7 liters of shampoo in a year? How can we make better sense of this figure? Let’s go a step further to break down this aggregated number into something that gives a more interesting picture of shampoo purchasing by separating shampoo consumers into three buckets: heavy buyers, medium buyers and light buyers. This is done simply by selecting the top 20 percent of households who bought the most shampoo in a year and classifying them as heavy buyers; the next 30 percent as medium buyers; and the bottom 50 percent as light buyers. It is difficult not to notice that the quantities bought by these three sets differ significantly. This is not only true for shampoo but in almost every FMCG category. We divide consumers based on the quantity they buy to identify the heavies versus the mediums versus the lights. Like with shampoo, there will be a big difference in how much is being purchased by the three different groups. This simple segmentation is one way to help manufacturers identify ways to grow their brands. The heavy buyers of shampoo are already purchasing 3.7 liters per year, equivalent to 10.1 milliliter per day. These consumers are probably washing their hair frequently enough to give manufacturers less of a chance to increase their usage of shampoo. The way to move forward with this set of heavy shampoo consumers is to upgrade them to more premium shampoos, thus driving their value growth, or get them to use other hair products such as treatments and conditioners. On the other end of the spectrum, light users of shampoo are not yet well-developed, so the strategy with them is back to the basics of driving an increase in usage through the education on washing their hair more often. This example illustrates that many times consumers are varied in terms of their development when it comes to using various products, including shampoo.

As marketers, there are two lessons that can be learned from this. First, the market you choose to serve is not always at the same development stage. Therefore, you should get to know your consumers and understand the opportunities that exist. Second, quantify each opportunity to set your priorities. Finally, adapt your marketing strategies to suit the various consumer segments that you wish to target.

After all, not all consumers are the same and that is what makes the job of targeting consumers so exciting in this country. We have urban consumers who are more affluent and moving up the value chain for more premium and value-added products. But at the same time, we can’t forget that not all urban consumers are at the same development stage, as noted in the shampoo example. And then there are also the rural consumers of this country that may require different marketing strategies altogether.

So, identify the different consumer segments that exist in your categories, quantify the potential of each consumer segment, prioritize which consumer segment(s) you want to target and lay out a solid marketing plan to reach your targeted consumers.

Published in The Jakarta Globe on January 26^th 2013

Edward Garner, director at Kantar Worldpanel, explains: “These positive results are a sign of stabilisation for Tesco as the retailer gets back on track with its customers. However, this improvement has put some pressure on the rest of the big four with Morrisons in particular suffering a drop in sales and a share decline of 0.6 percentage points in the latest period.”

The strongest growth recorded during this latest period is at the discount and premium ends of the market. The Waitrose figures echo the record Christmas it reported, with strong year-on-year growth of 8%.

Meanwhile, the discount outlets, and Aldi in particular, lead the way in the first stage of 2013 – strongly out-performing the market with growth rates of 28.2% for Aldi and 10% for Lidl. Iceland holds on to the record 2.2% share reported last period.

Edward Garner continues: “It is worth noting the improved performance from The Co-operative this month, with the retailer recording a sales increase of 0.9%. This growth contrasts with the declines posted throughout 2012 and could be a positive step for the grocer.”

The widening gap between market growth, currently at 3.3%, and grocery price inflation (4.9%) is causing a squeeze on shopping budgets. As a result, there is a heightened need for retailers to deliver value for money to customers.

An update on inflation

Grocery inflation stands at 4.9%* for the 12 week period ending 20 January 2013. This is an increase on the 4.5% reported last period and continues a rising trend since September last year.

*This figure is based on over 75,000 identical products compared year-on-year in the proportions purchased by British shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Watch the previous commentary here.

Fiona Keenan, consumer insight director at Kantar Worldpanel, comments: “Christmas resulted in an all-time record share for Amazon. The retailer posted growth across all categories, with its most notable performance in CD sales – historically HMV’s stronghold. However, this doesn’t necessarily mean it would benefit the most from possible HMV store closures. HMV shoppers are more likely to shop in physical stores, leaving the likes of Game and the grocers in a good position if HMV leaves the high street – particularly if they react quickly.”

Asda has had a strong quarter and is the only grocer to have grown its share, which now stands at 10.4%. This was mainly driven by its performance within games, on the back of the big Christmas releases, which pushed it significantly closer to Tesco within this category.

Fiona continues: “Amazon’s strong performance may not sit so well for the wider industry as a move away from the high street brings with it a move away from impulse purchasing. Last year, HMV music customers spent £61m on CDs picked up while browsing. Generating sales in this way remains a challenge for online retailers.”

Despite gifting being key in the fourth quarter, the biggest proportion of sales came from people buying for personal use with gifting sales down across all categories. Sought after expensive hardware, such as tablets, kindles, and smartphones, is now topping the gifting charts, leaving customers with less money to spend on mid-priced items. However, with an upsurge in advanced hardware also comes an increase in software sales, meaning that the overall entertainment market is likely to see a post Christmas boost, with digital sales doing particularly well.

* Published today for the 12 w/e 23 December 2012

In comparison to the same period last year, Android has remained stable, 44.8% to 44.2%, while Windows remained in third place at 2.6% of smartphones sold in the 12 weeks to December period.

Top carrier rankings remain consistent this period, with AT&T continuing to maintain its lead with 33.3% of smartphones sold in this 12 week period. AT&T has declined slightly, reducing the gap with Verizon whose share remains stable with 32% of smartphones sold. Sprint remains one of the key carriers offering Apple but is seeing little increase in sales share, as the brand continues to decline this period in third place with 14.8% of smartphone sales.

The data is derived from Kantar Worldpanel ComTech USA’s consumer panel, which is the largest continuous consumer research mobile phone panel of its kind in the world, conducting more than 250,000 interviews per year in the U.S. alone. ComTech tracks mobile phone behavior and the customer journey, including purchasing of phones, mobile phone bills/airtime, and source of purchase and phone usage. This data is exclusively focused on the sales within this 12 week period rather than market share figures. Sales shares exemplify more forward focused trends and should represent the market share for these brands in future.

Kantar Worldpanel ComTech analyst Mary-Ann Parlato states, “Apple’s continual improvement is thanks to both the iPhone 5 and older models attracting various customer groups, from repeat Apple buyers, first time smartphone buyers and those coming from other smartphone brands”.

“In particular, 36% of iOS sales were derived from other smartphone users over the last year. While this figure remains stable over time, the proportion of Android users moving towards the Apple brand increases. 19% of iOS sales over the last year were derived from Android users, compared to 9% in 2011,” continues Parlato.

This trend is most evident within Verizon where half (49%) of iOS sales were derived from users of other smartphone brands, and 30% were derived from Android. These figures are much higher compared to AT&T where 15% of iPhone purchasers came from other smartphone users (6% from Android).

While for other customer groups, 35% of iOS sales were those upgrading from a previous iPhone and 30% were those upgrading to their first smartphone.

AT&T continued to utilize their large Apple base with 55% of their iOS sales stemming from these users upgrading to a newer iPhone while 37% of Verizon’s iOS sales were derived from their large featurephone base.

Find out more:

Read the previous US ComTech Press Release here.
Follow us on Twitter to get the latest updates here.
Discover more about Kantar Worldpanel ComTech here.

Elsewhere, Windows is experiencing strong European growth, particularly in Britain and Italy, with shares hitting 5.9% and 13.9% respectively – up from just 2.2% and 2.8% a year ago.

Dominic Sunnebo, global consumer insight director at Kantar Worldpanel ComTech, comments: “At the end of 2012 the global OS picture shows Android on top, but clearly the rate of growth it experienced over the past year is beginning to slow as easy wins from first time smartphone buyers begin to reduce.

“It has been far slower than Microsoft would have liked, but Windows Phone is now starting to gain respectable shares in a number of key European countries. However, its performance in the Chinese and US markets remains underwhelming. As the two largest smartphone markets in the world, these remain key challenges for Microsoft to overcome during 2013.”

iOS continues to perform well in the States, now holding half of the US smartphone market for two consecutive periods and taking two-thirds of the rapidly expanding Japanese smartphone market.

Sunnebo continues: “Among the handset manufacturers, Samsung has held onto the number one spot in Britain, claiming 35% of smartphone sales, although Apple is now biting at its heels with 32%. Nokia is experiencing something of a turnaround in Britain with its smartphone sales share at 6.2% and actual sales growing by over 50% compared with last year. Meanwhile, BlackBerry continues to find trading tough in the run up to the BlackBerry 10 release; however, its 9320 handset gave it a boost over Christmas with two-thirds bought as a gifts.”

Smartphones proved popular over the festive season with a third of all handsets bought in December given as Christmas gifts. The BlackBerry 9320 was the most popular gifted handset in December, followed by the Samsung Galaxy Ace 2 and Apple iPhone 4S. The majority of smartphone gift recipients were under 18 years old and 57% were women. More than one in five handsets bought as gifts in Britain during December were from Tesco.

Smartphone percentage penetration in Great Britain hit 61% in the latest period, 82% of all mobile phone sales over the past 12 weeks were smartphones.

* 12 w/e 23rd December 2012

Find out more:

Read the previous Kantar Worldpanel Comtech report here.
Follow us on Twitter to get the latest updates here.
Discover more about Kantar Worldpanel ComTech here.

Edward Garner, director at Kantar Worldpanel, comments: “These festive trading figures show a dead heat between Tesco and Sainsbury’s in the battle for Christmas. Both posted identical growth rates of 3.9% – just ahead of the total market – and market shares unchanged from a year ago. This represents a clear improvement in Tesco’s fortunes following a series of share dips in 2012 but it is also a strong performance from Sainsbury’s which had been predicted to suffer disproportionately from the Tesco fight-back by some commentators.”

The small Asda share dip represents a bedding-in of the Netto acquisition with its 17.7% share strong by historical standards for this period. Morrisons’ sales decline is consistent with previous reports.

Edward continues: “Waitrose’s strong performance over the seasonal period is reflected in its 8.6% growth rate, which is over twice the market average. Although this six week report is, strictly speaking, not comparable with our usual 12-week series it is worth noting that the Waitrose share is higher than any previous share we have reported for the retailer.

“Elsewhere, shoppers continued to seek value for money with ongoing positive performances for Aldi, Lidl and Iceland.”

Watch the previous commentary here. 

David Berry, commercial director at Kantar Worldpanel, explains: “The strong performance of Dunnes comes after a prolonged period of under-performance, with market share hitting a low point of 21.4% in September. The boost in share over Christmas has regained some of this lost ground and places the retailer in a more competitive position for 2013.”

Growth across the grocery market remains subdued at just 0.3%; this is despite an increase in price inflation to 5%. David continues: “One of the biggest factors influencing the price of groceries is the poor growing conditions seen during the summer of 2012. Vegetables are an important part of the grocery basket, particularly in the run up to Christmas, and we have seen some sharp price increases. With an extra €17m spent on Christmas ‘must haves’ like sprouts and potatoes, there has been less of the household budget available for ‘treat’ groceries such as soft drinks and confectionery.”

Among the other retailers, Aldi continues to post exceptional sales growth of 30% and its share has overtaken Lidl for the first time, becoming the fourth ranked grocery retailer in the state. Despite this milestone there is evidence that shoppers have again shifted some of their spending back to traditional supermarkets over Christmas. Aldi and Lidl achieved a combined 12.6% market share in October, with this dipping to 11.9% in the latest month.

Elsewhere, Tesco and SuperValu have both performed broadly in line with the market, with Tesco holding market share at 27.8% and SuperValu dipping marginally to 19.5%.

Superquinn has performed behind the overall market, but a reduction of the sales decline has resulted in a better Christmas for the retailer compared with 2009, 2010 and 2011.

An update on inflation

Grocery inflation stands at 5.0%* for the 12 week period ending 23 December 2012, ahead of the 4.2% in the previous period and the highest since the 5.6% seen in May 2011.

*This figure is based on over 30,000 identical products compared year-on-year in the proportions purchased by Irish shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Read the previous report here.
Follow us on Twitter to get the latest updates here.

Edward Garner, director at Kantar Worldpanel, comments: “Among the big four supermarkets Sainsbury’s is, once again, the only retailer to increase its share compared with last year. Tesco’s share has dipped slightly, from 30.6% to 30.5%, however this is an improvement on the performance seen throughout 2012, when the average share drop was 0.4%, suggesting that festive shoppers gave the retailer a welcome boost in the run up to Christmas.

“The well-publicised under-performance of Morrisons continues and it is the only big four supermarket to lose sales compared with last year. This highlights its need to address the lack of convenience outlets and an online offering in 2013, as already clearly identified by the retailer.”

The ongoing strong performances of the premium and discount ends of the market continued in the lead up to the festive period. Waitrose has achieved 5.4% growth, while Aldi, Lidl and Iceland posted respective growth rates of 30.1%, 10.8% and 9.7%. Iceland’s 2.2% share is a 12-year record for the retailer.

Edward Garner continues: “Historically, the discounter sector has seen its share dip at Christmas as shoppers treat themselves and trade up, but the all-time record share of 3.2% for Aldi is a sign of the times and shows that this is no longer the case. Aldi and Lidl both benefitted from carrying items such as goose, venison and fine wines in their pre-Christmas catalogues this year. It seems that offering premium products at budget prices has paid off for the discount retailers.

“The polarisation of the market is highlighted by consumer spend levels which were widely anticipated to drop this year. While 47% of shoppers did reduce their spend in the lead up to Christmas, 48% of shoppers increased their spend by 4.5% (the rate of inflation) showing that ‘two nations’ continues to be a key feature of the grocery market.”

The Kantar Worldpanel measure of grocery price inflation has sharply increased to 4.5%, suggesting that 2013 could bring a renewed period of pressure on household budgets as shoppers trade down to cope.

An update on inflation

Grocery inflation stands at 4.5%* for the 12 week period ending 23 December 2012. This is an increase on the 3.5% we reported last period and continues a rising trend since September last year.

*This figure is based on over 75,000 identical products compared year-on-year in the proportions purchased by British shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Watch the previous commentary here.

During the same period, Android sales share declined 10.9% to 41.9% of the market, while Windows positioned itself at third place with 2.7% of smartphones sold in the November period.

AT&T continues to see success due to the strength of the iPhone 5 and maintains its status as the top selling smartphone carrier with 35.4% of smartphones sold in this 12 week period. Verizon follows in a close second with 31.9% of smartphones sold. Sprint, in third, with 14.5% of sales, sees the largest decrease year on year, down 5%.

The data is derived from Kantar Worldpanel ComTech USA’s consumer panel, which is the largest continuous consumer research mobile phone panel of its kind in the world, conducting more than 260,000 interviews per year in the U.S. alone. ComTech tracks mobile phone behavior and the customer journey, including purchasing of phones, mobile phone bills/airtime, and source of purchase and phone usage.

Kantar Worldpanel ComTech analyst Mary-Ann Parlato states, “The iPhone 5 has been successful this period however we also see that Apple’s older models – the iPhone 4S and 4 have also contributed to the growing share of iOS.” Parlato continues, “This is particularly the case for first-time smartphone iPhone buyers where we see the older models still selling well amongst this group.”

Of those who purchased an iPhone in November, 27% upgraded from another smartphone OS, 34% upgraded from a previous iPhone and, 40% upgraded to their first smartphone.

First-time smartphone buyers upgrading to an iPhone led to iOS becoming Verizon’s top selling OS for the first time. Verizon, who has the largest featurephone user base, saw 44% of their featurephone user base upgrade to an iPhone, compared to 38% of AT&T’s featurephone user base.

On the other hand, AT&T’s original exclusivity with Apple led to half (51.7%) of their iPhone user base upgrading to a newer iPhone – a large difference compared to just 15% among Verizon’s iPhone users who upgraded to an iPhone on Verizon.

Find out more:

• Read the previous US ComTech Press Release here.
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Dominic Sunnebo, global consumer insight director at Kantar Worldpanel ComTech, comments: “Apple has reached a major milestone in the US by passing the 50% share mark for the first time, with further gains expected to be made during December.”

Meanwhile in Europe, Samsung continues to hold the number one smartphone manufacturer spot across the big five countries, with 44.3% share in the latest 12 weeks. Apple takes second place with 25.3% share while HTC, Sony and Nokia shares remain close in the chase for third position.

Sunnebo continues: “Although Windows sales in the US remain subdued, Nokia is managing to claw back some of its share in Great Britain through keenly priced Lumia 800 and 610 prepay deals. The next period will prove crucial in revealing initial consumer reactions to the Nokia 920 and HTC Windows 8X devices."

“Nokia continues to find it tough to attract younger consumers in Great Britain. Over the past six months, just 28% of Nokia Lumia 800 sales have come from under 35’s, compared with 42% of all smartphone sales. With the Nokia Lumia 920 being one of the few handsets available on EE 4G, new tariffs may help to change this by attracting early adopters in the coming months.”

Smartphone percentage penetration in Great Britain hit 60% in the latest period, with 83% of all mobile phone sales over the past 12 weeks being smartphones.

* 12 w/e 25th November 2012

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By covering 40,000 households in china, the insights from the global market leader in consumer knowledge, Kantar Worldpanel, shows that lower tier cities market is unique no matter in category expansion, sale channel development and the manufactures growth path. Medium, small and localization are the key word for this unique market.

Emerging category is favoured by high income young families

To indentify the lower tier cities growth pattern, Kantar Worldpanel China Consumer Panels divides the FMCG categories into three layers by penetration: Staple (penetration over 80%, e.g. edible oil and rice), the Developing (penetration between 40% to 80%, such as shampoo and chocolate) and Emerging (penetration less than 40%, e.g. coffee and facial mask).

In terms of value, the demand growth of all three layers for consumers who live in lower tier cities is faster than up tier cities. Emerging category's average penetration growth rate in low tier reaches 10% which surpasses the up tier consumers' raise of 6% and the gap is also higher than Developing and Staple category. To further analyze the reason behind, new category trial is the key to lower tier cities market growth, which is reflected in the extending number of category bought in emerging layer. Of 44 emerging categories, number of categories each household bought raised from 9 to 9.6 in the past year. This implies a core opportunity of category penetration especially for each emerging category.

What type of family leads the emerging category development? Firstly, the family income is a critical driver. Lower city tier household average monthly income has increased by 88% in the past three years. “The gap of household disposable income between lower tier and up tier lessens gradually. And lower city tier consumers have been actively pursuing better life quality by buying high quality products and brands”. Secondly, as the core consumption group, young families with kid increase their value contribution to the emerging category from 40.6% to 42.9%, driving the growth of emerging layer in lower tier city. Significant penetration growth is observed for these young family favored emerging categories such as functional drink, cosmetic, mints and wet tissue etc. Meanwhile, the rapid growth of emerging category also benefits from the expansion of modern retailer, fast development of e-commerce and "category experts" like cosmetic specialist store.

More shopping baskets and more categories

The latest KWP data shows that consumers tend to have larger basket but reduced frequency in the recent year. This behavior is driven by large package in up tier cities and enriched number of categories in lower tier cities, which reflects the distinct competition environment in lower tier cities. The behavior of larger basket and reduced frequency benefits modern trade in one-stop shopping nature. However, in lower tier cities the trend prevails among traditional trade like groceries more than among modern trade. Grocery's frequency drops by 3.4%, trip spend increases by 18.4%, which is higher than the growth rate of modern trade. It is pity that the modern trades missed the opportunity to catch the trend, yet in average a household goes shopping in hypermarket 18 times a year in lower tier city, which is still much lower than their up city tier opponent with 27 trips in hypermarket. Attracting more consumers to purchase in hypermarket will directly encourage category trial. Thus, the win-win cooperation exists between hypermarket and emerging category manufactures by driving the purchase frequency to hypermarket.

The modern trade’ growth slowdown- a disadvantage for key manufactures

It is needed to reconsider the reason why modern trade fails to fully grasp the opportunity in lower tier cities market. In the recent year, modern trade's value growth in lower tier cities is only 16%, while the growth rate of specialist store and department store is over 20%. Till the third quarter in 2012, the top retailers grown by 5% in lower tier cities while medium and small sized retailers enjoyed more than 15% growth. This is caused by top retailers' new shops expansion progress slows down comparing to last year and they are more focus on enhancing the sales performance of those newly opened stores. This market strategy also shows the weakness of low growth dynamic of individual shop.

In the past, key manufactures benefits from retailers' fast expansion towards lower tier cities and they successfully raise their market share in modern trade up to 28%, which is higher than 21% market share in traditional trade. Recently, also affected by the modern trade's growth slowing down in lower tier cities, most of key manufactures' development pace is hindered as well. Medium and small manufacturers gain more benefits from the steady growth of traditional trades such as grocery, free market and cosmetic shops etc. It's worth concerning that even in the modern trade the share of key manufactures is shrinking and occupied by medium and small brands. To adjust sales strategy in lower tier cities by learning consumer behaviors and market requirements is urgent. Therefore, key manufactures need to avoid fully copy modern trade strategies in up tier cities but to consider developing product packages and flavors that fits the needs of lower tier consumers.

Medium and small brands’ counterattack

The key FMCG manufactures have been aiming to the lower tier cities market long ago. In the recent year, most of key manufactures are successful in recruiting more consumers and have the value growth of 12.2%. If comparing to the 15.9% increase rate of total FMCG market, obviously there is room for the key players to drive. It is also found that for those categories with highly centralized brand share are not so influenced. For instance, instant noodles key players like Masterkong and Uni-President's share increases from 62% to 69% in lower tier cities. And CSD brands like Coca-Cola, PesiCo and Wahaha, take 90% market share and is still growing. On the contrary, categories with fragmentized brand share are facing more fierce market competition. Such as skincare, the growth rate of key manufactures is far lower than medium and small brands like Pehchaolin and Inoherb. The market share of shower gel key players drops from 37.4% to 36.7%. Are the key manufactures well prepared to respond the counterattack of medium and small brands with more and more strengthened learning/ imitating ability?

Facing the changing market competition environment in lower tier cities, medium and small brands have done better gaining the initiative. To catch up, the key manufactures have to make proper adjustment to the market strategies:

• To strengthen the long term partnership with key retailers, and help them to understand lower tier cities consumer behaviors and accelerate to transition period for the newly opened shops. 
• To keep close monitor the rise of medium and small retailers, and enlarge the retailers list as required.
• The key manufacturers should give up the wait and see attitude for traditional trade in the lower tier cities. How to strengthen the brands execution and distribution really into the lower tier is an inevitable subject in the competition with medium and sumall brands.

We decided to dig deeper to see what lessons we could develop for consumer goods makers and retailers pursuing growth from the rising number of middleclass shoppers. Their expansion has been challenged by a lack of detailed, real-time data that would enable retailers to better understand shoppers’ behavior and fully capture the opportunities before them.

In our groundbreaking report “What Chinese Shoppers Really Do But Will Never Tell You”, published in June, we helped fill that void by sharing real-time shopper data, including the insights gained from a rare look at what shoppers actually do at the point of sale as opposed to what they say they do. This joint study by Bain & Company and Kantar Worldpanel examined the shopping behavior of 40,000 Chinese households from 373 cities in 20 provinces and four major municipalities, creating a comprehensive look at how much shoppers spend by region and by city in 26 important product categories, ranging from milk to shampoo. We followed up with a second report that explored shopper behavior in more depth across three dimensions: city tier, category nature and development stage, and shoppers’ life stages (see Figure 1). A third report examined the dynamics between foreign and domestic consumer goods makers to help both types of competitors capture their share of China’s growth.

In our fourth report, we explore the implications of our findings for retailers in modern trade. Our analysis provides several key insights:

• Modern trade shoppers make fewer trips to the store but spend more per trip, with the average price per item increasing.
• E-commerce is experiencing rapid development and explosive growth, although shoppers are increasingly using online sites to track down cheaper prices in a few higher-priced categories.
• As we detailed in our previous reports, China’s shoppers tend to be repertoire shoppers in most categories. They prefer to choose from a range of brands in a particular category for the same need or occasion instead of being loyal to a brand. The swift expansion of modern trade is helping to fuel the trend toward repertoire behavior by offering a wide variety of brands and promotional activities. It’s a trend that will favor retailers because consumer goods companies will be increasing investments in point-of-sale activation to encourage new shoppers to choose their brands over competing brands on the shelf.
• Despite the extensive choices offered by modern trade, it’s only the top brands and SKUs that contribute the majority of retail sales, according to our analysis. That means retailers that strive to increase listing fees by adding SKUs may actually be tying up shelf space and working capital with low-selling SKUs.
• Our research also confirmed that grocery retailing in China still is largely a local, city-based business, given the vast differences in consumer tastes and behavior. Leading retailers combine an extensive local footprint designed to achieve broad penetration with an effective retail model that motivates shoppers to make repeat visits and increase their basket size.

Information

• Read the China Shopper Report - Series 1 by clicking here.
• Read the China Shopper Report - Series 2 by clicking here.
• Read the China Shopper Report - Series 3 by clicking here.

Edward Garner, director at Kantar Worldpanel, comments: “The strong performances from Waitrose, Iceland, Aldi and Lidl continue to be a key feature of the grocery market. In particular, the advance of Aldi continues unabated and its 27.3% growth is being built on a solid foundation with 10% more shoppers than a year ago and 17% growth in the value of each shopping basket.”

Aldi intends to open another 40 stores in 2013 which will bring its total to over 500 outlets. Some of these will be smaller high street stores, which will help the retailer to become more competitive in the convenience market and is likely to cement its success further.
Edward continues: “Sainsbury’s is once again the top performer of the big four and has beaten the market with year-on-year growth of 4.7%. While the other big three retailers all experience share losses, it has managed to lift its share from 16.7% last year to 16.9% now.

“These share losses are particularly acute for Morrisons which has experienced a sales decline of 1.1%, bringing its share down from 12.3% a year ago to 11.7% now. The online grocery channel is currently growing at nearly 20% per annum, and Morrisons’ absence from this channel will be holding it back. However, it is expected that online wine sales via Morrisons Cellar will make a start on addressing this.”

An update on inflation

Grocery inflation stands at 3.5%* for the 12 week period ending 25 November 2012. This is an increase on the 3.0% we reported last period and the recent low of 2.6% for September, and is largely driven by increases in Fresh Foods and Alcohol.

Watch the previous commentary here.

During the same period, Android sales declined 16.6% to 46.7% of the market, placing the platform behind iOS for the first time since April 2012. RIM sales also declined to 1.6% of smartphone sales, allowing Windows to take the third position at 2.7%.
Additionally, AT&T has regained its spot as the top selling smartphone carrier for the latest period, with 34.7% of smartphones sold, overtaking Verizon at 27.5%. Sprint and T-Mobile follow with 19.9% and 8.4% respectively. AT&T has seen the most significant growth in smartphone sales, up 8.4%, while T-Mobile sees the largest decline at 5.4%. This is notable as T-Mobile remains the only top carrier that does not carry the iPhone.

The data is derived from Kantar Worldpanel ComTech USA’s consumer panel, which is the largest continuous consumer research mobile phone panel of its kind in the world, conducting more than 260,000 interviews per year in the U.S. alone. ComTech tracks mobile phone behavior and the customer journey, including purchasing of phones, mobile phone bills/airtime, source of purchase and phone usage.

Kantar Worldpanel ComTech analyst Mary-Ann Parlato says the increase in share by iOS and AT&T are attributable to the release of the iPhone 5.

“Our research shows that the majority of Apple’s sales, 62%, came from existing Apple owners upgrading to the new device,” says Parlato. “Additionally, of the smartphones sold by AT&T during this period, iOS accounted for two out of every three.”

While Apple’s flagship model gained the lion’s share of iOS sales on AT&T, sales increases also trickled down to the lower priced predecessors, the iPhone 4S and iPhone 4.

“It’s not surprising to see the iPhone 4 and iPhone 4S benefiting from the release of the iPhone 5. At AT&T, 38.3% of feature phone customers who changed device in the last three months, changed to an iPhone, a figure higher compared to Android at 11.9%. So while the iPhone 5 has seen movement amongst current Apple users, there is also now greater availability for first time smartphone buyers to join the Apple user base,” Parlato says.

On Verizon, Android remains on top; however momentum has slowed with smartphone sales shares declining year-on-year from 60.1% to 50.5% for the OS. It’s within this carrier where iOS has closed the gap, as the brand now represents 47.9% of Verizon smartphones sold in the latest period.

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Dominic Sunnebo, global consumer insight director at Kantar Worldpanel ComTech, comments: “The last time we saw iOS overtake Android in the US was when the iPhone 4S was released and Apple managed to retain its lead for three consecutive periods. This time we predict that Apple will beat its previous high of 49.3% and achieve its highest ever share of the US smartphone market within the next two periods.”

Apple’s rise in the US has not been replicated in quite the same way across Europe where Android still takes the lead, accounting for 73.9% of sales in Germany and 81.7% in Spain. However, it is now enjoying share gains in four of the five major European countries with a particularly strong performance in Britain where it holds a 32.7% share. 

Sunnebo continues: “Germany remains a tough market for Apple with its share falling by 5.1 percentage points over the past year.  The Samsung Galaxy S3 has taken almost a quarter of the country’s smartphone sales over the past 12 weeks to boost Android yet further.  In Italy, strong sales of the Nokia Lumia 610, the fourth best selling handset over the past 12 weeks, and the Nokia Lumia 800, the seventh best selling, have helped drive Windows’ share up to 11.7%  – the highest across Europe.”

iPhone 5 success – building on loyalty

The majority of US iPhone 5 sales, 62%, have come from existing Apple owners upgrading to the new device, although Apple has also benefitted from people switching from Android devices (13%), people switching from BlackBerry devices (6%) and a small number of first time smartphone owners. 

Sunnebo comments: “Apple has always managed to maintain loyalty levels far above the competition, and this has clearly played a part in driving sales of its new device.  An impressive 92% of existing Apple owners in the US said they will choose an iPhone the next time they upgrade.  While loyalty is clearly key, it is also important to make sure that new customers are attracted to your brand. With roughly 60% of US iPhone 5 sales coming from existing customers and 40% from new consumers, Apple is achieving this at the moment – a clear sign of the strength of the brand in the US marketplace.” 

One of the key physical changes on the iPhone 5 was the inclusion of a bigger 4” screen and 4G/LTE capability, both of which appear to have had a big impact on the ways consumers are using their devices compared to previous models.

Sunnebo continues: “Previous KWP ComTech data has shown that bigger screens make a significant impact on the reality of how consumers actually use their device, and the latest usage data shows this is clearly the case for the iPhone 5.   The usage data is likely to come down over time as iPhone 5 users at this stage will inevitably be early adopters and therefore more engaged with the category, but initial signs are very positive.” 

*12 w/e 28 October 2012

Find out more:

Read the previous Kantar Worldpanel Comtech report here.
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• Consumerism trends today & tomorrow: over the last few years, Vietnamese consumers have become smarter, more sophisticated, health-conscious and convenience-oriented… So, what will come in the next 10 years?

• How Vietnamese change the way they shop: Modern Trade in Vietnam has gone through the very initial stages of development and is now entering into Acceleration phase. Together with this rapid development, Vietnam will witness major changes in its shopper behaviours.

• WorldpanelOnline.com: Kantar Worldpanel is proud to introduce our new online data delivery and analysis tool – WorldpanelOnline.com. With this leading technology, you can get easy access to the data and insight you need anytime, anywhere.

Successful development of a growing consumer base is critical for businesses to succeed in a highly fragmented and competitive market environment. In a recently published 2012 China shopper report by Kantar Worldpanel and Bain & Company, it was identified that in most FMCG categories in China, penetration is the most important key success factor for a brand to build its market leadership.

The latest report from Kantar Worldpanel’s national urban panel shows that Procter & Gamble, one of the first entrants to the Mainland China market, reached a staggering 156 million households out of a universe of 162 million households. This means 97% of families purchased at least one P&G product in a year. COFCO, the largest state-owned food conglomerate in China holds a close No. 2 position in the ranking, reaching 150 million households, followed by Master Kong group with 147 buying families on annual basis.

Rising incomes and growing aspiration for quality have seen Chinese consumers becoming more brand conscious and willing to pay more for brands from leading companies. As many global companies revealed their ambitions to grow their customer base substantially in emerging markets, China is inevitably becoming a new battleground for marketers. Kantar Worldpanel identified three common strategies essential to drive consumer base growth in China.

Innovation is fundamental to recruit more buyers

New product launches and portfolio extensions have helped companies recruit incremental buyers. Mondelez (Kraft) has been successful growing buyer base over the past two years through innovations which include line extensions for Oreo and Chips Ahoy in the biscuit category as well as the introduction of mini formats across several of its biscuit brands as well as in the confectionary category with smaller pack formats for Eclairs.

Unilever managed to grow the consumer base of Clear by developing male grooming variants and at the same time, through its relatively new shampoo brand Dove, which was only launched in China in late 2010 but has been rapidly building a strong consumer base by appealing to a new segment of shampoo consumers.

It’s not only multi-nationals that have grown through innovation. Uni-President has managed to grow its buyer base significantly in the instant noodle category, mainly from the successful introduction of its pickled beef flavoured product.

Lower tier city expansion to grow brand footprint

Many manufacturers have been focusing heavily on the top tier cities, but now increasingly find that the potential for further growth lies in the lower tier cities.

Mondelez (Kraft) has been successful in growing through innovation, but they have also managed to grow at a rapid rate in the lower tier cities compared to the top tier cities, further contributing to their success in the most recent 12 months. In fact, over half of its buyer growth came from the lowest tier county level cities and counties while buyer base in the top tier cities remained flat.

Uni-President also managed to penetrate deeper in the lower tier cities, contributing to its very sharp increase in buyers in the latest year, with 45% (4.5 million buyers) of its buyer growth coming from county level cities and counties and only 20% coming from top tier cities.

M&A to get fast access to new consumer base

Many companies in China in the past have increased their buyer base through acquisition of local players. Nestle’s acquisition of Xufuji and Yinlu helped to boost its buyer base by 29 million households, while Kraft’s acquisition of Cadbury globally contributed to its increased buyer base in the confectionary category. But probably the most prominent example of expanding buyer base through acquisition is COFCO’S recent acquisition of dairy giant, Mengniu, bringing COFCO almost 50 million additional households.

Jason Yu, General Manager of Kantar Worldpanel China, commented: ‘’Measuring the successful acquisition of new customers is critical as more companies focus on getting more people to buy more products. The key to successful growth for manufacturers in the complex China market is closely tied to the success of attracting buyers to their brands more than anything else. This is a challenge that faces all players in the FMCG market. But most of the top 15 FMCG companies, both local and international, managed to achieve remarkable growth in the number of consumers who buy their brands through innovation, geographical expansion or mergers and acquisitions or a combination of all elements.

We are pleased to launch the discussion paper Kantar Worldpanel UK has created on the online retail landscape: Online On Track?. This insight piece looks at the world of online retail across Grocery, Fashion, Beauty, Entertainment, Alcohol, Telecomms and Toiletries and Health.

Shopping online is here to stay and in this report, the first in a series of reports looking at consumer behaviour, we share our insights into this ever-changing retail market.

Please click here to read the report and get in touch with Suzannah Rowland for further information.

David Berry, commercial director at Kantar Worldpanel, explains: “While the growth seen this month is a good sign for the grocery market, we are not out of the woods just yet and many grocery retailers are still struggling. Shoppers are continuing to watch their purse strings, buying fewer groceries per trip but shopping more often. They are also spreading their spend across a broader spectrum of stores, meaning that it is a challenge for the grocers to drive sales growth.

“Aldi continues to be the standout performer; it has posted growth of over 30% and improved its share of the market from 4.7% last year to a record high of 6.1%. A key feature of its success is its ability to bring in new shoppers, with 70,000 more through the door this year, while also encouraging them to come back more often.”

Lidl and Tesco have also posted solid results, both growing ahead of the market and boosting their respective shares by 0.2 and 0.6 percentage points. Both retailers have also benefitted from the ‘shop more, spend less’ trend which has helped attract new customers to their stores.

Dunnes has reversed its recent decline in fortunes with an increase in market share to 22.4%, compared with 21.6% last month. This coincides with its October initiative which gave shoppers €5 back for every €50 spent in store. With initial results suggesting that shoppers have responded well to this deal, it will be interesting to see how each of the competing retailers will respond in the lead up to the Christmas period.

An update on inflation

Grocery inflation stands at 4.1%* for the 12 week period ending 28th October 2012, up from 2.6% in the previous period and the highest since the 4.4% seen in August 2011.

*This figure is based on over 30,000 identical products compared year-on-year in the proportions purchased by Irish shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Read the previous report here.

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The stand-out performer is Sainsbury’s, which has delivered a 0.4 percentage point jump in market share – moving from 16.4% a year ago to 16.8% now. Paralympics sponsorship, Brand Match and own-label investment have all helped to boost Sainsbury’s appeal to its shoppers.

Tesco continues to experience the pressure on share that has been a feature of the past year, growing behind the market at 2.1%.

Edward Garner, director at Kantar Worldpanel, comments: “Morrison’s performance this month will cause concern, with its share dropping from 12.0% to 11.5% and a decline in sales of 0.4%. Recent announcements about the development of online and convenience, which are the two fastest growing grocery channels, will no doubt be given added urgency as these channels continue to deliver growth for competitors.”

Asda’s share is unchanged this period as the effect of the Netto acquisition has largely dropped out of the year-on-year comparisons.

The discounters continue to progress as Aldi reaches a 3.0% market share – yet another all-time record for the retailer. Waitrose also impresses, as it gears up for its traditionally strong Christmas period, by holding on to the record 4.7% share it achieved last period.

An update on inflation

Grocery inflation stands at 3.0%* for the 12 week period ending 28 October 2012. This is an increase on the 2.6% we reported last period and may herald further increases going forward as the widely reported rises in world foodstuff prices work their way through to retail channels.

*This figure is based on over 75,000 identical products compared year-on-year in the proportions purchased by British shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Watch the previous commentary here.

Amazon continues to be the overall star performer with a 20.3% share of the market, up from 16.9% last year. Although it has performed well across all categories, games sales in particular have helped to drive its growth. iTunes Music has also posted strong results, growing its share by 2.8 percentage points, as it makes the most of the increasing popularity of digital music.

Fiona Keenan, consumer insight director at Kantar Worldpanel, explains: “Sainsbury’s success in the entertainment market is partly down to consumers switching their spend from other retailers, in particular from HMV and Game. However, it has also managed to encourage existing shoppers to spend more – those customers who purchased entertainment products from Sainsbury’s in quarter three last year spent an extra £4 million on videos, games and music in the same quarter this year.

“Sainsbury’s will also be benefitting from increased footfall with the number of times shoppers visit its stores growing by 2.6% year-on-year over the same 12 week period. As 51% of the retailer’s entertainment sales come from impulse purchases, having shoppers in its stores more often will naturally lead to growth in non-food categories too.”

Although HMV has seen a slight drop in share, this is smaller than the declines seen in recent periods. This is down to the retailer’s strong performance in video, where it still holds the number one spot, accelerated by its recent five for £30 Blu-ray promotion.

The declines in share for Game Group are a result of the overall games category losing share in the broader entertainment market.

Across the 3 major departments within FMCG, household and personal care are seeing stronger growth of 12% in the latest quarter whilst food and drink lags slightly behind at 9%. The growth of premium products and high levels of media spending are helping to contribute to the growth of many household and personal care brands but these departments are also seeing the slowdown in value growth over the last quarter.

RT-Mart and Walmart See Share Erosion as Yonghui Increase Shopper Base
The two leading retail groups, the Sun Art Retail Group and Walmart, have both seen declining share in the last quarter with Walmart seeing the most significant drop. Walmart’s decline can be seen across all city tiers with the largest fall seen in the 4 key cities (Shanghai, Beijing, Chengdu and Guangzhou) where the competition from both international and local retailers is most intense. Walmart’s weaker performance is driven by less shoppers visiting the store rather than shoppers spending less in the retailer. Given Walmart has slowed down its new store opening during 2012 the retailer will need to work harder to reinforce its everyday low pricing message in order to bring back or attract new shoppers to the store.

Yonghui continues to grow on an annual basis through its expansion into new provinces allowing the retailer to reach more Chinese households. Yonghui’s growth has been most impressive in the Beijing where 28% households have now visited the store over the last 52 weeks. Prior to September 2011 Yonghui has virtually no presence in Beijing. Over the latest quarter, however, the retailer shows stable performance versus the previous quarter on a national basis following 5 consecutive quarters of share growth.

E-Commerce: Strong Growth Continues but Still Heavily Focused On Personal Care
The strong growth of e-commerce continues as this channel reports 52% growth over the last quarter. 23% of Chinese households now buy their grocery products on-line and Kantar Worldpanel estimates that this figure will increase to 30% by the end of 2013 if the current trend continues. E-commerce remains more popular in the key cities when 36% of households have used this channel 5 times on average over the last year. In Tier 5 cities (counties) penetration is lower at 17% as too is frequency but the growth is strong as more households gain internet access and internet suppliers widen their distribution networks.

Personal care items account for 57% of all e-commerce sales compared to just 18% in hypermarkets showing that these types of products dominate this channel. Also shoppers will spend much more per trip when shopping online with the average personal care trip costing 125 RMB compared to 36 RMB in hypermarkets but the number of items per trip is less. Therefore, shoppers purchase more premium products on-line where the availability is much higher.

Household items, such as laundry powder and household cleaner, still represent a low proportion of on-line sales but this group of categories is growing at 100% within e-commerce showing that this channel is diversifying and on-line shopper baskets may start to look more like traditional baskets in the future compared to the current behaviour where many shoppers simply cherry pick one or two items. Currently the average number of items per trip in an e-commerce basket is 3.9 and this is increasing steadily overtime. However, there is still some way to go match the basket size seen within hypermarket of 8 items.

(Apple iPhone 5 released on 21st September in US, GB, Germany & France. Italy & Spain on 28th September. Not yet released in China & Brazil).

Apple has increased its share from 18.1% to 28.0% in the past year across Britain, while in the US its share increased by 14.2 percentage points.

Dominic Sunnebo, global consumer insight director at Kantar Worldpanel ComTech, comments: “While this latest data set only includes one week of iPhone 5 sales, we can see that in markets with a large number of existing Apple customers, sales have already seen a significant boost. We expect this momentum to be fully realised in the next set of results.

Tomorrow the UK joins the likes of the US, Germany and much of Scandinavia with the rollout of EE’s superfast 4G network.

Sunnebo comments: “The rollout of 4G across the UK tomorrow is great news for consumers wishing to replicate their home WiFi experience on the go. EE is in the unique position of being the only operator currently able to offer 4G services in the UK, but how much of an impact this will have on the competitive landscape remains an unknown.

“We expect to see a significant number of early adopters on Orange and T-Mobile trading up to a 4G EE contract; however, encouraging significant switching from competitors is likely to remain challenging. Consumers are increasingly savvy about new technology and there are likely to be a significant number of consumers who will wait until the likes of Vodafone and O2 bring out there offerings, in the hope that prices will be driven down.

“The message to consumers about the advantages of 4G over existing 3G will need to be very clear and indicate new possibilities which are open to subscribers. For example, already over 65% of Smartphone users access social networks on their phones, but it is in areas such as mobile TV and feature length streaming that 4G is likely to really open up new media rich experiences to users.”

In Great Britain smartphones made up 81% of all mobile sales, with this figure rising to 94% among 25-34 year olds. Even among 65+ consumers, smartphones made up 58% of purchases demonstrating the demise of the feature phone is imminent.

China

Initial results from the first continuous mobile phone research panel in China show iOS and Android make up 84% of all smartphone sales, with a total of 209 million Smartphone owners.

Sunnebo adds: “Samsung is the most popular Android manufacturer in China, with sales of Samsung Galaxy SII and SIII spearheading growth. HTC is also performing strongly as a result of its new Desire series. However, the number of Android OS manufacturers in the Chinese market is keeping more established global brands under pressure. Local brands such as Huawei, Lenovo, Xiaomi and Coolpad are all providing high-spec, low cost handsets that lower tier cities crave.”

* 12 w/e 30th September 2012

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Read the previous Kantar Worldpanel Comtech report here.
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David Berry, commercial director at Kantar Worldpanel, comments: “Aldi has been the star performer for a number of years and this is reflected in its 29.8% growth rate. Its strong performance is down to a solid combination of new store openings, a strong advertising campaign and a consistent evolution of the goods on offer in store. All of this means that Aldi has firmly established its position as the number five retailer in Ireland with a 6% share of the market and is now closing the gap on Lidl.”

Shoppers are continuing to keep close control over their spending – an austerity trend which has led to the value of the Irish grocery market falling by 0.5%. This is despite a slight increase in the Kantar Worldpanel inflation measure to 2.6%*. This trend is further demonstrated by consumers choosing to shop more often for fewer items.

Tesco and SuperValu have out-performed the market and are beginning to gain some momentum, both achieving higher growth rates than last month. Lidl has seen a moderate growth of 0.1 percentage points to 6.6%, although its 1% growth rate is the lowest it has posted this year.

David Berry continues: “While the grocery market as a whole remains subdued, there are still some areas that are performing well. Sales of alcohol at the grocers have grown by 8% this quarter, showing that staying in and have a drink is an increasingly popular choice for those of us who are on a budget.”

An update on inflation

Grocery inflation stands at 2.6%* for the 12 week period ending 30 September 2012, up from 2.3% in the previous period but significantly below the 4.4% seen in August 2011.

*This figure is based on over 30,000 identical products compared year-on-year in the proportions purchased by Irish shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Read the previous report here.

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Edward Garner, director at Kantar Worldpanel, explains: “Among the big four supermarkets, the stand out performance is from Sainsbury’s. Its sponsorship of the Paralympic games has clearly borne fruit, boosting its sales in this period. The retailer has also been bolstered by its Brand Match promotion and the ongoing relaunch of its own label range – both of which are proving popular with consumers.

“It has also been a record-breaking period for Waitrose, posting its highest ever share of 4.7% and building on the strong performance we have seen over the past decade.”

The grocery market as a whole is growing at 3.9%. This is above the Kantar Worldpanel inflation measure of 2.6%* meaning that, despite a background of austerity, there is currently real growth in the market.

Asda has also out-performed the market adding 0.1 share points – this is lower than the growths seen earlier this year as the effect of the Netto stores acquisition drops out of the year-on-year comparisons.

The results of Sainsbury’s and Asda contrast with Tesco and Morrisons which have both lost share over this period.

Edward Garner concludes: “The growth of the discounters and Iceland continue to be a strong feature of the market. In particular, Aldi has been delivering growth in excess of 20% per year since mid-2011 – clear evidence that value for money allied to a growing emphasis on product quality is encouraging shoppers to increase their loyalty to the outlet.”

An update on inflation

Grocery inflation stands at 2.6%* for the 12 week period ending 30 September 2012. This continues the downward trend from the recent peak of 6.2% in November 2011. However, this situation is threatened by stubbornly high world food prices as a result of poor grain harvests in the USA, Russia and Ukraine.

*This figure is based on over 75,000 identical products compared year-on-year in the proportions purchased by British shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Watch the previous commentary here.

Dominic Sunnebo, global consumer insight director at Kantar Worldpanel ComTech, comments: “Windows is making steady progress in the big European economies and is now challenging BlackBerry for third spot in the European OS league. With the momentum Windows 8 will bring towards the end of 2012, it seems highly likely that it will achieve this before the end of the year.

“Lower end devices are driving sales of the platform as consumers seek value, resulting in growth rates of 6.6% in Italy, 3.5% in France and 2.3% in Great Britain.* In Italy, Windows now holds a double-digit market share, 10.4%, a first in the European market.”

Samsung also continues to power on across Europe, with smartphone share across the big five European markets at 48% in the latest 12 weeks. After joining the European smartphone market late Sony is making up for lost time with its Xperia series, outselling both BlackBerry and Nokia as a result of strong performances in Spain, Germany and France. Apple’s iOS has seen its share decline by 4.3% across Europe’s major markets in the period leading up to the iPhone 5 release. However, this is set to rebound strongly with the success of the new model reflected in next month’s data.

In the US, iOS and Android combined took 93% of all smartphone sales in the latest 12 weeks, putting into perspective the scale of the challenge facing both RIM and Windows in one of the world’s most important markets.

Smartphone penetration is now at 57.6% in Great Britain, with smartphones taking 80.4% of all sales in the latest 12 weeks.

* 12 w/e 02nd September 2012

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The survey has helped us clearly understand the dimensions of the competition between foreign and local consumer products companies and reveals some key findings.

Information

• Read the China Shopper Report - Series 1 by clicking here.
• Read the China Shopper Report - Series 2 by clicking here.
• Read the China Shopper Report - Series 4 by clicking here.

The market has fallen by 0.6% during the past year and price inflation is currently running at 2.3%; this means that grocery staples are becoming more expensive and the average shopper has less to spend on them.

David Berry, commercial director at Kantar Worldpanel, explains: “As speculation around the December budget increases shoppers are looking to tighten their grip on household spending. As a result the size of the average shopping basket is at its lowest level for seven years, dropping from an average of €22.50 last year to €21.30. Shoppers are reducing their spending by adopting a ‘little and often’ approach to shopping trips, which is helping them to limit wastage as they only buy what they need when then need it.”

Tesco and SuperValu have both posted moderate sales growth of 2.4% and 0.4% this month. However, Aldi remains the standout performer with sales growth of over 28%, lifting its share of the market from 4.5% to 5.9%. Aldi is also the only retailer to see an increase in both the number of shoppers in through the doors, having attracted an additional 98,000 to the store this year, and also the amount each shopper spends in store.

An update on inflation

Grocery inflation stands at 2.3%* for the 12 week period ending 2 September 2012, up from 2.1% in the previous period but significantly below the 4.4% seen in August 2011.

*This figure is based on over 30,000 identical products compared year-on-year in the proportions purchased by Irish shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Read the previous report here.

The survey has helped us clearly understand the dimensions of the competition between foreign and local consumer products companies and reveals some key findings.

Read the previous report clicking here.

Nic Lewisohn, managing director at Kantar Worldpanel ComTech, explains further: “Historically the Japanese mobile phone market has been something of an anomaly with non-Japanese brands failing to gain any real traction. However, this picture is changing rapidly as one in three smartphones sold last year were iPhones. Japan is the world’s third largest economy and has the tenth highest population making it a hugely important market which global mobile phone players can no longer afford to ignore.

“It is through combining ComTech’s unique methodology and large sample size of 10,000 consumers that we have, for the first time, the ability to accurately report key aspects of the Japanese market that will help operators, manufacturers and networks to make successful business decisions. The results will include insights into mobile phone ownership, sales, usage, loyalty, switching, pricing and forecasting.”

The new Kantar Worldpanel ComTech service will interview the same nationally representative sample of 10,000 Japanese consumers every month culminating in 120,000 completed interviews per year – with the first results from this panel expected in the fourth quarter of 2012.

Full Kantar Worldpanel ComTech coverage below:

Europe: UK, Germany, France, Italy, Spain
Americas: USA, Brazil, Mexico, Argentina
Asia Pacific: China, Japan, Australia

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Edward Garner, director at Kantar Worldpanel, explains: “Despite ongoing pressures, things seem to be looking up in the grocery market and shoppers are not having to trade down to the same extent as they have done over the past year.”

Among the big four, Tesco’s share has dropped from 30.9% a year ago to 30.8% – a relatively small decline compared with most of 2012 and evidence of some success in its fight-back. Although Asda outperforms the market with growth of 4.5%, this is now easing back as the effect of the Netto acquisition falls out of the year-on-year comparisons.

Edward continues: “Sainsbury’s maintains its robust run and beats the market with 3.8% growth. This is part of a longer-term trend which has seen the retailer continue to grow its share for the past nine years. The high-profile Paralympics sponsorship will no doubt provide further support but this won’t be fully seen in the figures until next month.”

“The pressure on Morrisons continues with its share slipping from 11.7% a year ago to 11.5%. However, this is to some extent inevitable, as the retailer presently offers no online ordering and currently only a small number of ‘M Local’ convenience outlets – two areas which are currently major contributors to the growth of its three main competitors.

“Outside of the big four, Aldi continues to be the star performer and holds on to its all-time record share with growth of 26.6%. This is driven mainly by dramatic growth in spend levels of existing customers - up 36% over the past two years - rather than an increased number of shoppers.”

At the same time, we continue to see the diverse nature of households and their shopping habits through Waitrose’s performance. The retailer holds on to its all-time record share of 4.6% and outperforms the market once again with growth of 7.8%.

An update on inflation

Grocery inflation stands at 2.9%* for the 12 week period ending 2 September 2012. This continues the downward trend from the recent peak of 6.2% for November 2011. However, this measure may have bottomed-out with poor grain harvests driving inflationary spikes going forward.

*This figure is based on over 75,000 identical products compared year-on-year in the proportions purchased by British shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Watch the previous commentary here.

In a follow-up to our first report published in June, 2012, What Chinese Shoppers Really Do but Will Never Tell You, we decided to explore shopper behavior in more depth across three dimensions: city tier, category nature and development stage, and shopper life stage. The joint study by Bain & Company and Kantar Worldpanel analyzed the behavior of 40,000 Chinese shoppers from 373 cities in 20 provinces and four major municipalities, providing a groundbreaking look at how much shoppers spend by region and by city in 26 important consumer products categories ranging from milk to shampoo. The comprehensive study covers all Chinese city tiers, categories in different development stages and shopper life stages (see Figure 1).

As we explained in our first report, in most situations as Chinese shoppers buy more frequently in a category, they also tend to buy more brands in that category. We call this repertoire behavior - the tendency to choose different brands for the same occasion or need (repertoire being the set of brands purchased by a shopper within a given category). By comparison, shoppers exhibit loyalist behavior when they repeatedly buy one brand for a specific need or occasion. Chinese shoppers exhibit loyalist behavior in a few categories, including baby diapers and infant formula.

By exploring the findings in more detail, we have been able to see how repertoire and loyalist behavior is affected by different city tiers, different category types in varying stages of development, and different shopper life stages – and the implications for both foreign and domestic brands.

Information

• Read the China Shopper Report - Series 1 by clicking here.
• Read the China Shopper Report - Series 3 by clicking here.
• Read the China Shopper Report - Series 4 by clicking here.

In a follow-up to our first report published in June, 2012, What Chinese Shoppers Really Do but Will Never Tell You, we decided to explore shopper behavior in more depth across three dimensions: city tier, category nature and development stage, and shopper life stage. The joint study by Bain & Company and Kantar Worldpanel analyzed the behavior of 40,000 Chinese shoppers from 373 cities in 20 provinces and four major municipalities, providing a groundbreaking look at how much shoppers spend by region and by city in 26 important consumer products categories ranging from milk to shampoo. The comprehensive study covers all Chinese city tiers, categories in different development stages and shopper life stages (see Figure 1).

As we explained in our first report, in most situations as Chinese shoppers buy more frequently in a category, they also tend to buy more brands in that category. We call this repertoire behavior - the tendency to choose different brands for the same occasion or need (repertoire being the set of brands purchased by a shopper within a given category). By comparison, shoppers exhibit loyalist behavior when they repeatedly buy one brand for a specific need or occasion. Chinese shoppers exhibit loyalist behavior in a few categories, including baby diapers and infant formula.

By exploring the findings in more detail, we have been able to see how repertoire and loyalist behavior is affected by different city tiers, different category types in varying stages of development, and different shopper life stages – and the implications for both foreign and domestic brands.

Read the previous report clicking here.

Dominic Sunnebo, global consumer insight director at Kantar Worldpanel ComTech, explains: “Android continues to dominate the European market in the build up to the iPhone 5 release, increasing its share by 20.2% in the past year. Surprisingly, Windows has managed to maintain its 5% share despite a raft of new Windows 8 products being announced. However, this has been achieved through heavy discounting.

Phones with bigger screens are becoming noticeably more popular – 29% of the Android devices sold in the past 12 weeks have a screen size of over 4.5 inches.

Dominic continues: “It is interesting to look at the impact a larger screen size has on how consumers use their smartphones, particularly as the line between tablets and smartphones becomes more blurred. Consumers who own a smartphone with a larger screen tend to be much more engaged with their device across a whole array of functions. For example, only 19% of consumers with a screen smaller than three inches download/watch videos, compared to 65% when the screen is five inches or more.

“However, bigger screens don’t just lead to an improved consumer experience; they also play a key part in customer retention. ComTech data shows that the more engaged consumers are with their device, the more likely they are to stay loyal to an OS/brand when they upgrade.”

* 12 w/e 5th August 2012

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David Berry, commercial director at Kantar Worldpanel, explains: “Value for money remains at the top of the agenda for shoppers who are becoming more selective about which products they buy and where they buy them. This has meant we have seen a surge in sales of retailer own brand goods across most categories, with everyday staples such as bread, breakfast cereals, biscuits and soft drinks doing well in particular. In fact, over the past two years ambient own label ranges like these have gained an additional four share points within the total market.”

Discounters continue to benefit from consumers watching their wallets, with retailers Aldi and Lidl now accounting for 12.4% of the total market. SuperValu has also performed well this period, posting growth of 0.3%, while Superquinn’s market share has remained solid at 5.5%, which is consistent with its position from last month.

David adds: “Tesco continues to perform strongly, posting sales growth of 3%. This is fuelled in part by a rise in a ‘little and often’ approach to grocery shopping which is driving customers through the doors more regularly. The economic imperative to reduce waste has led to an extra 3.9 million shopping trips over the latest quarter when compared to last year, although the challenge for the market is that each trip has reduced in value by over €1.”

An update on inflation

Grocery inflation stands at 2.1%* for the 12 week period ending 5 August 2012, down from 2.7% in the previous period but significantly below the 4.4% seen in August 2011.

*This figure is based on over 30,000 identical products compared year-on-year in the proportions purchased by Irish shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

The latest grocery share figures from Kantar Worldpanel, published today for the 12 weeks ending 5 August, show the grocery market has bounced back and is now growing at 3.9%. This is compared with the 2.1% reported just a month ago.

The big four supermarkets all performed strongly, with Asda and Sainsbury’s leading the pack and growing at 6.2% and 4.6% respectively. Although Tesco continues to lose share, this is now at a slower rate as it begins to close the gap with its rivals.

Fraser McKevitt, retail analyst at Kantar Worldpanel, explains: “It’s too early to attribute improved grocery sales to the Olympics, however, the increased market growth rate coincides with the opening week of London 2012 and the better weather in July.”

“Shoppers might not yet notice it at the tills, but they are starting to benefit from lower grocery inflation, with prices now rising at 3.2%* – the slowest rate for 18 months and a sign that things are starting to look up. Despite this, consumers are still seeking economy products and retailers are reflecting this demand in their store offerings. The lowest priced own label lines, such as Tesco Everyday Value, are growing at 13% while premium own label sales are falling by 4% year-on-year.”

The number of shoppers looking for value has helped both Aldi and Lidl maintain their double digit growth. Iceland continues to benefit from the strong frozen food sector with a year-on-year growth rate of 7.0%. At the other end of the price spectrum, Waitrose has grown by 7.4% – a considerable uplift on the relatively weak 4.8% growth posted last period.

An update on inflation

Grocery inflation stands at 3.2%* for the 12 week period ending 5 August 2012. This continues the downward trend from the recent peak of 6.2% for November 2011 and reflects lower inflation in dairy markets, particularly falling milk prices.

*This figure is based on over 75,000 identical products compared year-on-year in the proportions purchased by British shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Watch the previous commentary here.

Samsung’s success has hugely benefited Android, with its share of the big five countries growing from 42.7% in July 2011 to 65.7% in July 2012. Android has also retained its number one position in Great Britain in the latest 12 weeks of sales* with 59.5% share, up from 47% a year ago.

Dominic Sunnebo, global consumer insight director at Kantar Worldpanel ComTech, comments: “While the majority of noise is focused on big-name products such as the S3 or S2, it’s easy to forget that Samsung is selling smartphones across all tiers. As a result it now makes up five out of the top ten best selling smartphones in Great Britain – with even the smartphone/tablet hybrid Samsung Galaxy Note making it into the top ten.”

Elsewhere, Apple continues its strong performance in the US with share up 9.5% over the past year to 38.2%. Dominic Sunnebo explains further: “As the iPhone 4S nears the end of its lifecycle, and rivals such as Samsung & HTC bring out new flagship products, we inevitably see big changes in share. However, Kantar Worldpanel ComTech data clearly shows that the proportion of Apple consumers who have owned their device for at least 18 months and not upgraded has increased markedly over the last quarter, indicating current owners are holding off upgrading until the release of the iPhone 5.

“Apple continues to enjoy very high loyalty across the world. In Great Britain among Apple consumers who have changed device, loyalty currently stands at 80%, while 92% of current Apple consumers plan to buy another iPhone when they upgrade. With this in mind, any dip in Apple share is likely to be short-lived with the release of an updated iPhone in quarter three bringing momentum back to the Cupertino giant.”

Meanwhile, RIM continues to find trading tough, with France the only country where its share is holding firm rather than seeing further falls. RIM’s steepest decline has been in Great Britain, where its market share now stands at 10.9% compared with 21.6% last year. After a period of promising looking growth, Windows Phone share remains stilted around the 3% mark across most markets, as consumers await the release of much vaunted Windows 8 devices.

* 12 w/e 8th July 2012

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Amazon’s growth has largely been at the expense of specialists, including second-place HMV which has lost 0.8 percentage point of its market share since last year – opening up the gulf between the retailers to 4.8 percentage points.

Fiona Keenan, consumer insight director at Kantar Worldpanel, comments: “Amazon has grown its market share considerably since last year and now has a convincing lead over HMV, which has again seen year-on-year losses. The retailer will undoubtedly have been affected by its store closures; however, the trend of consumers switching spend online has also had an impact. However, HMV is not alone – supermarkets too are feeling the squeeze as Tesco dropped 1.7 percentage points and Asda 0.2 percentage point in the past year. Sainsbury’s is the notable exception to this rule, increasing its share of the market to 5.3% as a result of a strong focus on its video offer.”

Amazon now holds 21.4% of the entertainment market – with its success in audio-visual markets spurred by growth in digital music, and its overall business performance also benefitting from considerable growth in the sales of eBooks. iTunes has also been able to capitalise on the growth of digital music sales, increasing its market share by 2.8 percentage points.

GAME group has lost almost half of its market share over the past year, dropping from 10% to 5.2% – with both GAME and Gamestation sales dropping by 3.6 percentage points and 1.2 percentage points in the latest 12 weeks. This drop in share is the effect of store consolidation in the first quarter of this year.

* Published today for the 12 w/e 10 June 2012

Mark Thomson, business unit director at Kantar Worldpanel, explains: “The economic situation has been tough in Ireland throughout 2012, and consequently consumers have been looking to control their spend at the weekly shop. Shoppers have spent €26.8 million less at the tills than they did during this period last year as household budgets remain squeezed. This has also resulted in a 1.9% rise in sales of own label products as consumers try to control their weekly spend. This trend is bolstered by the strong growth of discount retailers who predominately stock their own range of brands.

“Aldi and Lidl now have a combined share of 12.2% and are the big winners from austerity shopping, with respective growth rates of 22.5% and 3.4%. Tesco has also performed strongly, extending its market-leading share to 28.7% this quarter. This has been driven largely by good performance across key areas of the store such as fresh and chilled products.”

Despite ongoing pressures on the grocery market and Ireland’s early exit from the Euro 2012 championships, shopper spend on alcohol was up 3.6% over the latest period with discounters seeing the biggest jump in sales.

An update on inflation

Grocery inflation stands at 2.7%** for the 12 week period ending 8th July 2012, up from 2.6% in the previous period but significantly below the 3.8% seen in July 2011.

**This figure is based on over 30,000 identical products compared year-on-year in the proportions purchased by Irish shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

RT-Mart suffers from competition, while Walmart still growing in lower tier cities
The two leading retail groups: the Sun Art Retail Group and Walmart have seen some significant share losses over the last quarter. This share erosion has been most noticeable in the key cities where they have faced increased competition from local chains such as Vanguard and Yonghui. Yonghui, who were virtually non-existent in the key cities one year ago, have managed to capture a 2.2% share in the top tier cities in the latest quarter. The retailer now operates 223 stores across China. This rapid expansion has not been without cost as Yonghui announced a decrease in net profit despite an estimated 45% increase in operating income in its latest trading statement.

The Sun Art Retail Group has focused its new store openings in the prefecture (or Tier 2) level cities which is RT-Mart’s heartland and here the retailer is maintaining share over the last quarter. However, in Tier 1(provincial capitals) and Tier 3 (county level) cities competition is intensifying and RT-Mart is losing share. The group will need to further expand its operations to these other cities in order to become a truly national player. Also, in 2011 the group opened 46 new stores, of which 42 were added to the RT-Mart chain and 4 to the Auchan banner. This may have accounted for the slower growth of Auchan particularly in the key cities where share fell from 5.1% to 4.6% in the last quarter.

Walmart has been the most successful foreign retailer in China in terms of market share. Its rapid expansion over the last 16 years and focus on growing their footprint within China has led the retailer to a 7.5% share in the latest year. Despite recent setbacks Walmart continues to grow in the lower tier cities where the other foreign retailers have very limited presence. Walmart’s share in county level cities is now 4.9% which has increased from 4.5% in the same quarter last year.

More than 1 in 5 Chinese families now shopping online for FMCG products
The growth of e-commerce shows no signs of slowing with 58% growth in the last quarter. The annual penetration of online FMCG shopping (which is the proportion of Chinese household who purchase from this channel) has increased from 16% to 22% and in China’s top tier cities. 1 in 3 households use this channel at least once in a year. The huge growth in e-commerce is seen across all city tiers as shoppers utilise the benefits that this channel offers such as cheaper prices, the convenience of delivery and access to brands that might not be available in their local stores. Retailers who also have an online store need to be aware of these benefits and market themselves and the products they offer accordingly.

Two online retailers which have been quick to market and very successful have been Taobao and Yihaodian. Taobao has a wide reach and we see a similar proportion of shoppers using Taobao to buy FMCG products across all city tiers, especially after the launch of Tmall Supermarket. Yihaodian, however, is much more focused in key cities but we expect to see further expansion into the lower tier cities with its expanding logistic infrastructure.

As more online stores join the market and as the number of households with internet access continues to grow this channel is set grow at a rapid pace. Manufacturers need to be able to effectively distribute their products to these online stores as well as implement successfully digital campaigns if they want to take advantage of this trend and accelerate growth within their business.

Edward Garner, director at Kantar Worldpanel, explains: “We are seeing big cutbacks by consumers as they continue to respond to this current period of austerity. The success of the discounters, Aldi and Lidl, is a clear example of shoppers watching their purses, with both retailers continuing to surge ahead. Once again, they both achieve all-time record shares of 2.9% and remarkable growth of 26.1% for Aldi and 11.5% for Lidl. Similarly, although Waitrose is still growing at over double the rate of the whole market, this growth has fallen back to 4.8% from 7.5% last period − suggesting there are signs that the premium sector is beginning to slow.

“Another sign of austerity making an impact is the decline of the premium own label sector. Premium own-label products have been in continuous growth since 2008, despite often being more expensive than their brand equivalent. Now; however, they are declining by 6% year-on-year, while economy own labels such as Tesco’s Everyday Value are growing at 13%.”

Among the big four supermarkets, fortunes continue unchanged with market share growth for Asda and Sainsbury’s and share dips for Tesco and Morrisons.

Edward Garner adds: “Frozen food continues to be the top-growing food sector, as consumers look to reduce waste, and this has helped Iceland to continue the upward trend it has enjoyed since 2005.”

An update on inflation
Grocery inflation stands at 3.8%* for the 12 week period ending 8 July 2012. This continues the downward trend from the recent peak of 6.2% for November 2011 and reflects lower inflation for fresh produce and falling milk prices.

Watch the previous commentary here.

Dominic Sunnebo, consumer insight director, explains: “We are seeing much of the Android sales growth being driven by consumers trading up from feature phones to smartphones. Android handsets currently offer an easier platform to enable these consumers to upgrade, as many first time smartphone consumers state ‘price of handset’ and ‘multimedia capabilities’ as their main reason for choosing an Android device. Our data shows that Android has a higher share of those consumers spending under £50 on buying their handset across the vast majority of countries we cover.”

In markets like the UK, smartphone penetration in the prepay market is increasing, with Android handsets such as the Samsung Galaxy Ace and Y performing well. These models are attracting younger first time owners, a group who have traditionally been loyal to BlackBerry.

Dominic adds: “It’s important to understand the added value that these first time smartphone consumers bring to carriers and brands. When consumers trade-up from a feature phone, they spend significantly more on their bills and on buying their device. The increase in monthly bill becomes even more important to the carriers, when we consider that most mobile contracts have a 24 month minimum term.

“Smartphone consumers are much more loyal to their brand of handset and carrier than feature phone consumers, highlighting the importance of capturing feature phone owners when they are starting to look to change their handset.

“It’s also interesting to note that although Android’s share is high in the USA market, it has decreased by 6.8% points over the year. This trend contrasts Apple’s growth, which is a reflection of a successful iPhone 4S release and the first time availability of the iPhone 4 and 4S on Sprint.”

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Kantar Worldpanel equips shoppers from 40,000 households throughout urban China with barcode scanners to record their purchases from all channels. The findings dispel several misunderstood notions about how Chinese consumers respond to product brands. Although over 60 percent of Chinese shoppers have said that brands were their top consideration when purchasing (in previous Bain research), in reality, they rarely act on that consideration at the moment of purchase. Instead, they are in a near-constant state of trial, without leading to eventual preference and loyalty.

“Our study shows that marketers must pay attention to what Chinese shoppers do, not what they say in the survey,” said Bruno Lannes, partner of Bain & Company, head of Retail and Consumer Products Practice for Greater China and lead author of the study. “Otherwise, they risk spending money on trying to drive behaviors that simply are not possible in this market.”

With the exceptions of infant formula, baby diaper, milk, beer, carbonated soft drinks, and chewing gum, the study finds that brands increase market share by reaching a higher penetration in their category. Outside of loyalty-driven categories, Chinese shoppers typically have three to four brands in their shopping repertoire for any given category. At the same time, category leaders in China do not necessarily see a higher rate of repeat purchases or succeed in getting existing shoppers to spend more on their brand. In fact, even for the leading brand in each category, more than 30 percent of brand shoppers only purchased the top brand once over the course of a year.

In most categories studied, Chinese shoppers buy more brands as they buy more frequently in that category, expect the loyalty-driven categories. The four categories with the widest repertoires are biscuits, with an average of six to seven brands purchased per year, fabric detergent, with an average of four to five, and juice and facial tissue, with an average of three to four each. Among heavy shoppers (the top 20 percent of the most frequent shopper in a category), shoppers purchase an average of ten to eleven biscuit brands per year, while fabric softener, juice, and facial tissue average five to six brands. See chart below for the data for all categories.

The study concludes with separate plans of action for categories where shoppers purchase from a wide repertoire of brands and for those where loyalty is more prevalent.

For brands in repertoire categories:

• Marketers must ensure that their brand is part of the shopper’s repertoire and use in-store activation to recruit and capture shoppers
• Brands should use marketing initiatives, such as TV commercials, to raise shoppers’ awareness and help them to think about the brand when they shop for a specific occasion or need
• Brands should not expend energy on trying to increase loyalist behavior if it is not part of their category
• Brands need to focus first on successfully developing scale in priority regions and localities
• Brands must invest in understanding shoppers’ actual behaviors in stores, instead of asking shoppers what they want out of context

For brands in loyalist categories:

• The key is to recruit new fans in well-defined shopper segments, and encourage them to try your brand first
• Targeted marketing initiatives and public relations events build brand preference
• Brands should be easy to find in the store. But constantly motivating shoppers with in-store initiatives is not necessary

“The Chinese consumers are pampered with abundance of brand choices hence it is increasingly difficult for major brands to stand out from the clutter.” explained Jason Yu, General Manager of Kantar WorldpanelChina. “It is critical for marketers to understand the nature of the categories they are competing and select the right growth strategy.’’

Added Bruno Lannes of Bain & Company, “Winning brands are those that are better at recruiting new shoppers day-in and day-out, and keep increasing the number of shoppers who buy their goods.”

Information

• Read the China Shopper Report - Series 2 by clicking here.
• Read the China Shopper Report - Series 3 by clicking here.
• Read the China Shopper Report - Series 4 by clicking here.

Kantar Worldpanel equips shoppers from 40,000 households throughout urban China with barcode scanners to record their purchases from all channels. The findings dispel several misunderstood notions about how Chinese consumers respond to product brands. Although over 60 percent of Chinese shoppers have said that brands were their top consideration when purchasing (in previous Bain research), in reality, they rarely act on that consideration at the moment of purchase. Instead, they are in a near-constant state of trial, without leading to eventual preference and loyalty.

“Our study shows that marketers must pay attention to what Chinese shoppers do, not what they say in the survey,” said Bruno Lannes, partner of Bain & Company, head of Retail and Consumer Products Practice for Greater China and lead author of the study. “Otherwise, they risk spending money on trying to drive behaviors that simply are not possible in this market.”

With the exceptions of infant formula, baby diaper, milk, beer, carbonated soft drinks, and chewing gum, the study finds that brands increase market share by reaching a higher penetration in their category. Outside of loyalty-driven categories, Chinese shoppers typically have three to four brands in their shopping repertoire for any given category. At the same time, category leaders in China do not necessarily see a higher rate of repeat purchases or succeed in getting existing shoppers to spend more on their brand. In fact, even for the leading brand in each category, more than 30 percent of brand shoppers only purchased the top brand once over the course of a year.

In most categories studied, Chinese shoppers buy more brands as they buy more frequently in that category, expect the loyalty-driven categories. The four categories with the widest repertoires are biscuits, with an average of six to seven brands purchased per year, fabric detergent, with an average of four to five, and juice and facial tissue, with an average of three to four each. Among heavy shoppers (the top 20 percent of the most frequent shopper in a category), shoppers purchase an average of ten to eleven biscuit brands per year, while fabric softener, juice, and facial tissue average five to six brands. See chart below for the data for all categories.

The study concludes with separate plans of action for categories where shoppers purchase from a wide repertoire of brands and for those where loyalty is more prevalent.

For brands in repertoire categories:

• Marketers must ensure that their brand is part of the shopper’s repertoire and use in-store activation to recruit and capture shoppers
• Brands should use marketing initiatives, such as TV commercials, to raise shoppers’ awareness and help them to think about the brand when they shop for a specific occasion or need
• Brands should not expend energy on trying to increase loyalist behavior if it is not part of their category
• Brands need to focus first on successfully developing scale in priority regions and localities
• Brands must invest in understanding shoppers’ actual behaviors in stores, instead of asking shoppers what they want out of context

For brands in loyalist categories:

• The key is to recruit new fans in well-defined shopper segments, and encourage them to try your brand first
• Targeted marketing initiatives and public relations events build brand preference
• Brands should be easy to find in the store. But constantly motivating shoppers with in-store initiatives is not necessary

“The Chinese consumers are pampered with abundance of brand choices hence it is increasingly difficult for major brands to stand out from the clutter.” explained Jason Yu, General Manager of Kantar WorldpanelChina.  “It is critical for marketers to understand the nature of the categories they are competing and select the right growth strategy.’’

Added Bruno Lannes of Bain & Company, “Winning brands are those that are better at recruiting new shoppers day-in and day-out, and keep increasing the number of shoppers who buy their goods.”

David Berry, commercial director at Kantar Worldpanel, explains: “The continued high cost of fuel and a weaker euro means that fewer shoppers are willing to travel to the north for their groceries and are instead looking for value at home. During the latest quarter only 8% of households in Ireland bought their groceries from Sainsbury’s or Asda in Northern Ireland – contrasting with 16% during the same period in 2009.”

Overall shopper spending remains subdued as a result of the tough economic climate, with the decline in total grocery sales accelerating from a fall of 0.2% last month to a further drop of 0.5% this month. The discounters continue to increase their combined market share – which now stands at almost 12% – as shoppers look for value. Aldi has recorded sales growth of just over 20% – bringing their total share to 5.3%, just 0.2% behind Superquinn. Lidl has also posted substantial growth and now has a 6.5% share for the first time.

David adds: “Tesco and SuperValu also continue to perform strongly, with sales growth of 2.8% and 1.1% respectively. Tesco has grown its share by managing to encourage its shoppers back through the doors more often; meanwhile SuperValu’s drive to recruit new customers to its stores seems to be working.”

Despite grocery sales coming under pressure, the ongoing Euro 2012 championship is boosting the sales of alcohol - with sales jumping by 4.4% over the past four weeks.

* For the 12 weeks ending 10 June 2012.

An update on inflation

Grocery inflation stands at 2.6%** for the 12 week period ending 10 June 2012, up from 2.2% in the previous period but significantly below the 3.5% seen in November 2011.

**This figure is based on over 75,000 identical products compared year-on-year in the proportions purchased by Irish shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Price increases faster than income growth

According to the General Statistics Office, until April 2012, Vietnam Consumer Price Index has increased by 18.7% over the past year. At this speed, price inflation has surpassed consumer income growth. Our research findings show that, after adjusting for the increase in price, consumer’s real earnings in urban 4 key cities (HCM, Hanoi, Danang and Cantho) and rural areas fall by 3.6% and 1.7% respectively. This reminds us of the remarkable price hike in 2008 when price increased at a rate of 23% per year whereas income was struggling to grow by 8%.

Strongly bouncing back since the end of 2010 at 2-digit speed, high inflation has put a heavy impact on the economic landscape and influenced everyday life of millions of people all around the country as well. Our research findings show that FMCG (Fast moving consumer goods) typical basket’s Price Index has increased by 44% since 2009 while Household Income Index tried hard to follow at 34%. In rural areas, the numbers are 40% and 33% respectively. Vietnamese consumer power squeezes as inflation filters into the cost of daily life. As a result, in urban areas, FMCG volume growth rate has dropped from 11.1% annually in 2010 down to the nearly-zero 1.2% in 2011. The scenario is brighter in rural areas yet threats are still there since this is the first time in the last 3 years, price inflation has surpassed consumer income growth in rural Vietnam.

Coping with price hikes: rationalizing, bulk buying and down-trading patterns prevail

Price sensitivity and providence become common shopping attitudes among consumers. The lower household income, the more sensitive to price they are these days. According to Kantar Worldpanel Lifestyle Survey, three out of every four urban household work to a strict budget when they do grocery shopping. In addition, more than half of urban consumers are confident that they know when a promotion price is a good price. Besides, consumers turn out to be more and more provident about the future, which is clearly shown via their expanding wallet share of savings from 11% in 2010 to 13% in 2011. “I save for harder time rather than spend now to make life easier” is the shared tactic of more than 60% urban housewives. This is especially true to lower income groups whose daily life is strongly affected during such hard time.

Confronting recurrent price hikes, urban Vietnamese consumers reorganise their FMCG shopping behaviour by rationalizing their spending on the bare necessity consumer goods categories in order to afford soaring prices for the packaged groceries such as cooking oil, sauces, and instant noodles. In 2010, an average household spent only one fifth of their FMCG budget for packaged grocery. One year later, it costs them up to nearly one quarter and, at the same time, pushing other not-quite-necessary categories to shrink themselves to fit in the tight budget under price hike times. However, the largest part is always dairy and chilled food, which accounts for more than one third of urban FMCG spending.

Apart from rearranging their share of wallet, consumers also drop some products off their basket. Our research findings show that non-food categories such as personal care and household care were those which suffer the most from this trend. For instance, less basic categories for in-home consumption such as glass cleaner, air fresher, shaving foam, lipstick and hair-styling seem not to stay high on the shopping list, or worse, to be left out when necessary.

Bulk buying – the fact that consumers go shopping for FMCG less frequently, yet increasing their trip size – is also observed as another reaction of consumers during inflation time. In addition, smart consumers go for big pack sizes as an economical solution to their annual basket. According to our Lifestyle Survey, nearly two third of urban housewives agree that “I will buy bigger pack size because the price is usually less expensive”. As a result, more and more households are heading for big pack sizes when they go shopping for FMCG products. However, this does not mean that consumers just go out to their favorite stores and pick up the biggest packs available. According to Kantar Worldpanel Lifestyle Survey, 56% consumers agree that they often look at the price per kilo/liter, not just the pack price!

However, not all consumers have the same reaction towards inflation: if the majority of the consumers are buying smart with bulk-buying pattern, down-trading trend is found among low-income shoppers, who are switching to more affordable solutions. This group is seeking for both lower prices and smaller pack sizes disregarding the relatively lower quality. One of the most noticeable reactions of those shoppers towards high inflation is buying shampoo and hair conditioner in sachets instead of bottles. They also choose powder detergent of low price brands or private labels in replacement of mainstream ones.

Opportunity to come

In order to sustain the growth during inflation time, “value for money” should be the key message that manufacturers and retailers should strongly hold, because that is what consumers are looking for. In addition, consumers are not homogeneous. Just like two faces of the same coin, there are different consumption trends happening at the same time in FMCG market. While low income consumers focus on different tactics to manage their spending including seeking for cheap prices, the upper class may not find themselves so strongly affected by high inflation and remain a better-value-for-money attitude in their sophisticated choices. Therefore, the key to success lies in the flexibility in understanding and adapting different demands of different consumer groups.

Moreover, despite the entire price hike and consumer power squeeze, the best part of the story is waiting for its turn as consumer price index has eased down in recent months thanks to a range of measures being adopted by the government to apply the brakes. As a result, shoppers are gaining back confidence recently. Therefore, businesses should also be well prepared to catch the initial signs of recovery and lead the tide.

Edward Garner, Director at Kantar Worldpanel explains:

“The remarkable growth rate recorded over the Jubilee is a sign of what’s to come during the Olympics when we expect grocery sales to soar. Competition is likely to be fierce with fortunes now considerably different among the big four.

Both Tesco and Morrisons suffer share dips of 0.4 points this month whereas Asda and Sainsbury’s have seen their shares strengthen. The two retailers have taken different paths to growth with Asda expanding its estate through its acquisition of the UK Netto stores and Sainsbury’s enjoying a long-term trend of organic growth as stores are added one-by-one. What both outlets have in common is strong price messages – Asda with its Price Guarantee and Sainsbury’s with its Brand Match – and this is supporting them well.”

The polarisation seen in recent months continues unabated with Aldi, Lidl, and Waitrose all holding on to all-time record shares – Aldi and Lidl both have 2.8% and Waitrose has 4.6%. All three outlets have successfully appealed to their respective shoppers who are now spending more in store.

Edward Garner continues:

“Iceland is growing at nearly twice the market average lifting sales by 6.3% this period. This is largely a result of the buoyant frozen food market, which tends to do well during times of economic uncertainty, and is currently the fastest growing grocery sector.”

Watch the previous commentary here.

Dominic Sunnebo, global consumer insight director, explains: “There was a period towards the start of this year where Android’s share began to flatline. However, in the past few months, we have seen a surge in sales, particularly in Spain and Germany.

“In Spain, recessionary pressures are clearly hitting consumers’ wallets –demonstrated by the budget Samsung Galaxy Mini topping the country’s sales charts. In Germany, the economy is clearly in a very different place, however, its major networks offer very low subsidies on handset purchases making it one of the most expensive countries in Europe to buy a smartphone. This means that smartphone penetration is the lowest throughout the major European economies. As a result, brands such as Huawei, which sell low-end Android models, are now starting to make inroads with almost 200,000 Huawei smartphones sold in Germany this year.”

RIM’s share in the US remains under intense pressure, falling to 5.2% in the latest 12 weeks, down from 9.2% a year ago. In Europe, RIM fairs better but continues to experience an intense competitive environment.

Dominic Sunnebo continues: “A year ago, RIM sales in the big five European countries were similar to that of the US. However, over the past 12 months there has been a paradigm shift with European RIM sales now around double that of RIM in its US stronghold – this is historically down to geographic reasons with BlackBerry being founded in Canada.”

WP7 now holds over 3% share in most major markets, with its share highest in Germany and the US. Although the majority of WP7 customers in the US are first time smartphone owners, a significant proportion are also upgrading from previous generation WinMobile devices.

Sunnebo comments: “Our data clearly shows that in the US, LTE/4G handset capability is crucial for brands wanting to steal existing smartphone consumers. As WP7 handsets with this capability start to become more prevalent, we expect to see signs of Android, RIM and iOS customers switching to the Microsoft platform.

* 12 w/e 13th May 2012

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Nic Lewisohn, Managing Director at Kantar Worldpanel ComTech, explains further: “The Chinese telecoms market is already the largest in the world with over one billion mobile phone users, and this market is only getting larger as the Chinese Middle Class, with its considerable disposable income, continues to grow. Kantar Worldpanel ComTech already works with the majority of the world’s major handset brands and operators and our expansion into China has been driven through a desire to provide our clients with the same level of insight in China as they receive from us elsewhere. This includes insights on mobile phone ownership, sales, usage, churn, loyalty and pricing.

“We are really excited to be the first to launch a continuous telecoms consumer panel in China, a market which can be hugely complex, but which presents a fantastic commercial opportunity for mobile brands. China is strategically very important to our global clients and locally very different from other markets. ComTech clients demand cross-market consistency and high quality and our large representative panel will provide a detailed insight which both global and local brands can use to execute their sales and marketing strategies in China.”

The new Kantar Worldpanel ComTech service will use Kantar Worldpanel’s existing operation in China to conduct its interviews. Individuals from city tiers one to four will form this new panel, culminating in 180,000 completed interviews per year. The first results from this panel are expected in late July and will provide a detailed insight into China’s mobile marketplace.

Edward Garner, Director at Kantar Worldpanel comments: “On the face of it, the declines in market growth might seem alarming but there are exceptional factors. Easter and the Royal Wedding helped year-on-year growth soar to a remarkable 7.6% in the four weeks leading up to May 15 2011 – a hint of what's to come over the Jubilee weekend. Comparing the current figures with the same period two years ago, the four week growth stands at 6.5%. This is actually in line with long-term trends and shows 2011 as the anomaly.”

Against this backdrop, the retailers might expect to record depressed growth however Aldi tells a different story. The retailer has posted growth of 25.4% to achieve a share of 2.8% – another all-time record. Lidl also holds on to its record 2.8% share from last period with 11.3% growth and Waitrose continues to outpace the market with 7.0% growth.

Edward continues:“The ongoing strong performances of Aldi and Lidl have led some commentators to believe that consumers are deserting conventional stores for the discount sector. However, a more realistic picture of shopper behaviour shows that many consumers are continuing to do their main shopping trip in their usual store, but spending the remainder of their household budget on the discounters.”

Among the big four, Sainsbury's holds on to its share while Tesco and Morrisons continue to feel the pressure. Asda remains strong with 6.5% growth, reflecting the addition of Netto stores. The stubbornly high level of food price inflation means that shoppers continue to feel the squeeze on their household budgets.

Watch the previous commentary here

• Yonghui emerges as the fastest growing retailer in Q1.
• Struggling to relate to teenagers? Marketers wrestle with familiar issues.
• Lower tier cities propelling growth in cosmetics as Key cities slow.

Read these insights by clicking here

Read the previous Spotlight on China here

Dominic Sunnebo, global consumer insight director, explains: “With less than one week of sales, the HTC One X is already one of Britain’s 10 best-selling smartphones over this period. The release of the Sony Xperia S and the announcement of the Samsung Galaxy S3 have also added to a surge of interest from consumers looking for their next upgrade.

“We are likely to see some big changes in manufacturer shares over the coming months. Particularly as we expect to see almost 22 million consumers aged 13+ changing their mobile device in the next year, with almost 80% of these consumers buying a smartphone.”

Despite the release of the Xperia S, Sony’s share continues to dwindle taking just 10.4% of Android sales in the past 12 weeks while LG holds less than 1%. Both manufacturers have struggled to convince their existing featurephone consumers to switch to their new smartphone ranges – only 11% of Sony featurephone users traded up to one of its smartphones over the past year and this figure is even lower for LG at just 4%.

Dominic continues: “With smartphone penetration in the UK at 53.1%, the pool of featurephone users left to trade up is beginning to diminish. This means that smartphone manufacturers need to step up their game and find ways of stealing consumers from their competitors – something that usually proves harder than convincing existing customers to trade up from featurephone to smartphone.

“Rich new content and features are a big driver for consumers looking to trade up. However, convincing users to switch brands requires an emphasis on the user experience – an area in which Apple excels. Consumers have come to expect top-end hardware and manufacturers are responding with innovative software, good services and exclusive content partnerships. These expectations from tech-savvy customers are yet another obstacle for Asian manufacturers, such as Huawei and ZTE, who will attempt to make a splash by releasing high-end models in the coming months.”

Around the world

Android’s stronghold is now becoming more prevalent across Europe, particularly in Spain where it holds 72.3% of the market with year-on-year growth of 39.5%. It has also seen phenomenal growth in Italy and Germany with respective growth rates of 29.3% and 27.2%.

* 12 w/e 15th April 2012

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Key global retailers have again struggled to maintain share, especially over the last quarter, and the local players continue to grow their presence. The Sun Art Retail Group, consisting of RT-Mart and Auchan, Walmart and Carrefour have all seen a share decline in the last quarter. Carrefour, however, has seen the largest erosion in share over the last 52 weeks which has been driven by its performance in the key cities where the store has seen less shoppers visit the store.

Yonghui, a rising star following its IPO last year, is rapidly expanding its footprint across China and now registers in the top ten national retailers with a share of 1.7%. By the end of 2011, the number of its stores reached 204, a year-on-year increase of 31%. In the latest quarter this retailer has grown by 69% compared to the same period a year ago and has seen 13% of household visit the store over the last year in China’s provincial capitals.

Tesco Capitalising on China’s Most Important Shopping Period

The Q1 period is the most important of the year for FMCG trading in China as shoppers will spend at least 30% more during this quarter as they entertain guests and buy gifts for their family and friends during Chinese New Year. Shoppers will not visit more stores during this period and instead increase their spending per trip to 90 RMB on average (compared to 68 RMB for other quarters in the year). Therefore, retailers need to maximise footfall during this period and also ensure their ranges sufficiently meet the needs of shoppers during this festive period.
One of the key players who performed particularly well over this period was Tesco who grew both their footfall and the amount shoppers spent in store, particularly outside of the key cities. This is something many other larger players did not achieve with their growth coming more from an increase in spending amongst their existing shopper base.

E-Commerce within FMCG Gaining Traction

E-Commerce is still relatively small within the FMCG market but is growing very fast at 49% year on year as more shoppers add this channel to their repertoire. Two key players here are Taobao and Yihaodian. Taobao, with its space ‘Taobao Chaoshi’ dedicated to grocery shopping, is the dominant player and has seen just over 3% of households shopping there in China’s key cities in the latest quarter. Personal care items are currently more likely to be purchased online and account for 57% of sales compared to 17% within modern trade. Sites like Taobao and Yihaodian are able to offer a larger range and competitive pricing compared to many of the bricks and mortar stores. This is particularly appealing especially for those shoppers in the lower tier cities where hypermarkets and upscale cosmetic stores are less prevalent.
We are yet to see e-commerce become an important channel within food and drink categories. However, Tesco and Carrefour are both in the process of developing online shopping systems and Walmart has already acquired a controlling investment in Yihaodian. This combined with the rapid increase in the number of households with internet access and a strong willingness to shop online means this channel is likely to explode in the future.

Notes to editor:

Kantar Wordpanel China continuously measures household purchases over 100 product categories including cosmetics, food and beverages and the toiletry/household sector. Its national urban panel covers 20 provinces and four municipality cities (Beijing, Tianjin, Shanghai and Chongqing).

Edward Garner, director at Kantar Worldpanel, explains: “The discounters and Waitrose are outperforming the middle ground as shoppers polarise their spend. To this effect, Aldi and Lidl continue their strong run and both achieve record shares this period. Iceland’s growth rate of 9.1% is also racing ahead of the market – further proof that consumers are convinced by strong value-for-money messages.

“Waitrose sees no slowdown in its growth as some households refuse to let economic pressures affect their food purchasing. This may also be a result of cutbacks on eating out which have meant that some shoppers are willing to spend more money on bringing the dining out experience into the home. The continued growth of premium own-labels, particularly Tesco Finest and Sainsbury’s Taste the Difference, is further evidence of this behaviour.”

Among the big four, Asda has the strongest growth which includes the benefit of its Netto conversions. This is followed by Sainsbury’s with growth just ahead of the market at 5.4%. Both Tesco and Morrisons lag behind the market and their shares drop by 0.2 points compared with last year. However, in the case of Tesco, this is less than the declines seen earlier this year.

An update on inflation

Grocery inflation stands at 5.5%* for the 12 week period ending 15 April 2012. This is unchanged from the two previous reports. This remains above the market growth of 5.0% this period and means that households are still trying to rein in grocery spending by managing down their ‘personal inflation’

Watch the previous commentary here.

Apple also remains the largest smartphone manufacturer; however, Samsung is rapidly closing in, now just 1% behind in the latest period with 28.1% share.

Dominic Sunnebo, global consumer insight director, comments: “It is common to assume that smartphone growth is being driven by a young tech-savvy generation; however, our latest data shows that more than one in two mobiles bought by over 50s in the past 12 weeks were smartphones.”

With almost 20 million mobile owners over the age of 50 in Great Britain, there is a clear business opportunity for manufacturers and operators. Traditionally a Nokia stronghold, it is Samsung and Apple who are making the most of this market, now accounting for 36.6% and 23.4% of 50+ smartphone sales, compared with 6.2% from Nokia.

Sunnebo comments: “The keenly-priced Samsung Galaxy Ace is the top-selling handset in this group. This fits with our analysis showing that ‘cost of handset’ is the top stated reason for handset choice in the over 50s category. Given the relative price sensitivity of this consumer group, we would expect to see Asian manufacturers such as ZTE and Huawei start to make big inroads in this market during 2012.”

Smartphone use by over 50s tends to be based around ‘core’ functions, with 63% browsing the internet, 57% using email and 52% downloading apps. Social networking (34%), instant messenger (17%) and downloading/streaming videos (18%) are areas which prove less attractive to this group compared with their younger counterparts.

Sunnebo explains: “As internet connectivity becomes ever more integral to consumers lives, regardless of age, so the desire for mobile internet increases. Our data tends to show that over 50s mobile use replicates much of what they do at home on their PC or laptop. In contrast, under 50s tend to use their phones and computers for different purposes.”

In Great Britain smartphones made up 74.4% of sales over the 12 weeks, meaning that 52.2% of the British population now owns a smartphone.

* 12 w/e 18th March 2012

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Edward Garner, Director at Kantar Worldpanel comments:

“The findings make particularly good reading for Asda. Its 17.9% share is an all-time record performance and its year-on-year growth rate of 7.8% is leading the big four, largely thanks to the full integration of its Netto stores.

“Elsewhere, Tesco’s growth rate of 2.7% still lags behind the market and results in a drop in share. However, it is an improvement on the growth rates seen so far this year. Both Sainsbury’s and Morrisons’ shares remain unchanged from the same period last year.”

Waitrose, Aldi* and Lidl continue to out-perform the market, particularly so in the case of Aldi with year-on-year growth of 28.5%.

Edward adds:

“The frozen food market remains buoyant and this has helped Iceland to enjoy 10.2% growth – good news for the new consortium owning the chain.”

Watch the previous commentary here.

• International retailersreporting mixed performance in 2011 as local players fight back.
• Where to capitalise on opportunities in China in 2012?
• How breast feeding impacts the Infant milk market in China?

The much hyped Nokia Lumia 800 took 87% of WP7 sales, giving it a 2% uplift in share compared with a year ago. Germany remains the strongest market for WP7, with share now up to 3.1%.

The latest data also shows that Apple has increased its share of the British smartphone market from 22.7% a year ago to 28.7%. However, Android remains the number one OS in Britain, with its share up to 48.5% from 37.8% a year ago.

Dominic Sunnebo, global consumer insight director, comments: “There are strong signs that WP7 Nokia handsets are starting to make an impact on the European smartphone market though US sales, where the Nokia brand is weaker, remain underwhelming. The fact that WP7 sales have overtaken Symbian based on one handset is encouraging; however, Nokia will need to expand the range quickly in order to keep up with the slew of next generation competitor products being launched in quarter two.”

Kantar Worldpanel ComTech data also highlights that consumers are increasingly satisfied with their handsets. When asked how satisfied consumers were with their smartphone (where one is very unsatisfied and 10 very satisfied) the average smartphone score was 7.9; notably higher than those with a non-smartphone at 6.9.

Apple has the most satisfied customers with a score of 8.8, with Samsung in second place at 8.0 and HTC in third with 7.6. Likewise, when consumers were asked how likely they are to stick with the same brand when upgrading, Apple ranked top followed by Samsung and HTC.

Sunnebo explains: “Smartphone users are typically very happy with their handsets and this is because they can do so much more with them. When you look at the way consumers are using their mobiles compared with just a year ago, the change is huge. For example, just under half of people in the past four weeks used GPS or maps on their smartphones, this compares to only 33.9% a year ago. Similarly, 39.2% of people are now downloading or streaming videos to their mobiles, this has increased from 10.6% a year ago. All this helps to engrain the smartphone experience deep into consumer’s daily routines and the quality of devices available mean consumers have found little to complain about.”

In Great Britain smartphones made up 73.2% of sales over the 12 weeks, meaning that 51.3% of the British population now owns a smartphone.

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The requirement to understand the behavioral impact of advertising has never been stronger than now. With tightening budgets and investors demanding assets that make consistently strong returns, these days it is impossible to consider media investment without also considering its sales impact.
Therefore it is the utility of real consumer behaviour at the heart of Kantar Worldpanel's new capability that provides advertisers, media owners and media planners alike two critical strategic functions:

• The ability to quantify in real terms the return on investment of individual campaigns.
• The ongoing ability for significantly enhanced targeting and planning.

For the first time in China advertisers and their agency partners can develop media strategy with the confidence of the two market 'currencies' in the critical areas of media research behind them.
Ms Ruoyu Chen, President of CTR, commented: "Combining the TV viewing data and purchase behavior data will enable advertisers to clearly estimate the impact of advertising on consumer behavior. Both datasets come from our continuous research solutions and this will greatly enhance advertiser’s ability to understand their media return on investment. We are excited to see Kantar Worldpanel launch this brand new media investment tool."

"A new media environment in China requires a new way of measuring success. Kantar Worldpanel is uniquely placed to help advertisers to improve their media investment efficiency. We have already established the media evaluation and profiling capabilities in Europe and I am pleased to see we are able to bring the critically important insights to our clients in China, " said Marcy Kou, CEO Kantar Worldpanel Asia.

Paul Wang, Managing Director CSM Media Research, said: "Our mission as marketing research organizations is to better serve the advertising industry by delivering greater insight into real marketing effectiveness. Putting the power of actual media consumption behavior and product consumption behavior data sets together is an exciting step forward in this direction. CSM Media Research is pleased to be launching this new initiative and working with the industry to leverage learning from the data sets to drive stronger advertising ROI."

Notes to editor:

Kantar Wordpanel China continuously measures household purchases over 100 product categories including cosmetics, food and beverages and the toiletry/household sector. Its national urban panel covers 20 provinces and four municipality cities (Beijing, Tianjin, Shanghai and Chongqing).

The company, which specialises in consumer insights and has the largest continuous panel in Great Britain, was listed 80^th - rising 19 places since its first inclusion in 2011.

Tim Kidd, managing director at Kantar Worldpanel UK, Ireland and USA, comments: “This recognition is a great achievement. It reflects the exceptionally positive engagement of our employees and also helps in our ambition to be a ‘go to’ employer.

“The wider economy remains challenging and now, more than ever, providers of market research and insight need to deliver high quality consultancy expertise to clients.  We can only do this is by attracting and retaining the best people and creating an environment in which they can flourish.

“Our industry is no longer just about providing the data.  Clients need analysis, interpretation and strategic guidance to help them grow their business.  This requires good people.  We have been working hard to make our company a place people really want to work and we’re pleased to see we’re succeeding. 

“It is rewarding to be one of a very small group of market research agencies included in the list.  Given that we are – or should be – a fundamentally people-driven industry we need to continue to do more to make sure market research is an attractive career.  Being classed as one of the best places to work is a real boost.”

Key to Kantar Worldpanel’s success in this year’s list was the level of trust it places in its employees to make the right decisions for clients and the business as a whole – something extremely valued by its employees.  Areas in which Kantar Worldpanel also scored highly were its rewards for merit and good performance and the training and support it provides to employees throughout their careers.    

Edward Garner, director at Kantar Worldpanel, explains: “While the growth rate remains lower than grocery price inflation, currently at 5.5%, the gap between the two measures is narrowing – meaning pressure on household budgets, while still strong, is not getting any worse.

“Tesco’s market share remains under pressure and now stands at 29.7% − a level we last saw in May 2005 – as it faces stiff competition from its rivals. By contrast, the completion of its Netto conversions helped Asda retain its record share of 17.5% that we reported last month.

“Waitrose saw its share rise this month to 4.5% − an all-time record for the retailer. Its continuing strong performance shows that it is a mistake to talk about the ‘average’ UK shopper. Some consumers clearly value good service and instore experience when shopping, which Waitrose claims to provide. The retailer has also benefited from increasing numbers of shoppers, as its store expansion makes its shops accessible to more people.”

At the same time, the ‘Two Nations’ phenomenon continues as value for money remains paramount for many shoppers, with Aldi, Lidl and Iceland all enjoying double-digit growth as they hold on to record shares.

Sainsbury’s continued to out-perform the market in 2012 and lifts its share from 16.5% to 16.6%. Elsewhere, Morrisons dips slightly by 0.1% to 12.2%.

Watch the previous commentary here

Dominic Sunnebo, global consumer insight director, comments: “For the first time ever, you are now in the minority if you don’t own a smartphone. With more people jumping on the bandwagon, there is huge opportunity for both retailers and manufacturers. However, the competition is intense.

“Android holds on to its lead but Apple is making inroads, increasing its share of the British market from 21.7% a year ago to 29.1% now. Windows Phone 7 is also creeping up, taking over 2% of the market for the first time with the Nokia Lumia 800 taking the lion’s share. This looks set to continue with the expected launch of at least two new models at the Mobile World Congress conference. We forecast this will help it to grow its share to around 8% in the latter half of 2012.”

Symbian’s share has fallen to just 2.8%, highlighting the stark challenge Nokia faces as it makes the transition from Symbian to Windows Phone 7. However, it seems that the Lumia 800 release has helped Nokia to maintain its customer loyalty, albeit at a slower rate than it might wish for, with over a quarter of Windows Phone 7 customers having owned Symbian handsets in the past.

Dominic Sunnebo continues: “One of the real positives for Microsoft Windows Phone 7 is how engaged its users appear to be with its devices. Eighty one per cent of handset owners have used social networking on their device in the past month, higher than both iOS & Android. Meanwhile, three quarters have used GPS, indicating that its decision to include Nokia maps for free was a price worth paying to drive user engagement.”

It’s a slightly different story in the US with Apple continuing to make gains on Android. Apple now has 48.4% of the US market compared with Android’s 42.6%.

Dominic explains: “The jump we saw in Apple’s share last period was clearly not just a blip caused by the iPhone 4S release. Although the majority of growth is coming from the new handset, Apple’s latest pricing structure is also working in its favour with no discernable drop in sales of older iPhone 4 and 3GS models.”

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Walmart is the only key international retailer to gain share over the last quarter and now represents 7.8% of modern trade, just 0.1% away from the number one retail group, RT-Mart plus Auchan.

Growth for Walmart has come from both the top tier cities, where Walmart already has a stronger
presence, as well as the lower tier cities where the American chain is expanding its operations. The group’s accelerated conversions of Trust-Mart are now delivering positive results as the total group has gained 0.3ppts over the last quarter. Walmart has also managed to continue to grow in the West 1* region despite the recent mislabelling of pork incident in Chongqing.

Many of the other top retailers have struggled over the last quarter either remaining still or even losing share in the case of Carrefour, for example. The top ten retail groups, in the latest quarter accounted for 39% which has fallen by 1ppt compared to the same quarter a year ago. This suggests that China’s national retailer landscape hasn’t become consolidated as the smaller players fight back against the big international chains who now dominate many cities.

Local Retailers Fighting Back

International FMCG retailers in China have slowly been growing their presence over last decade but this trend is changing and in some areas of China the international retailers are actually losing share to the local players. For example, in the East 1** region Century Mart, which is part of the Balian Group, has now reached a share of 7.7% and increase from 6.8% in the same quarter a year ago. Also, in China’s North 2*** region the Wu-Mart Group, which consists of the Wu-Mart and Merry Mart banners, continues to stretch their lead of the international chains now reaching a share of 10% in the latest quarter up 0.8ppts from last year.

International retailers are considerably more dominant in China’s four key cities (Shanghai, Beijing, Guangzhou and Chengdu) where as a group they account for 49% of all FMCG sales whereas in China’s counties they represent a share of just 5%. However, the pressure from local retailers is not just seen in the lower tier cities where they are more established. They are also giving the international players a tough time in the provincial capitals.

So what has driven the performance of these local retailers? One success story has been the retail chain Yonghui. During 2011 Yonghui opened 49 new stores, an increase of 31% taking its total number of stores to 204. With its wide range of store formats, strong focus on fresh food offer and now substantial number of hypermarkets within their portfolio the company is able to compete on a more even playing field with its international competitors. Yonghui’s heartland is in Fujian and Chongqing region where it has built regional strength but its recent expansion to cities such Jiangsu, Henan and Heilongjiang is helping the retailer on its way to become a truly national player.

Looking Ahead

2012 will continue to see a changing and challenging landscape for FMCG retailers and there are a number of key trends which will play a key role in the future development of FMCG retailing in China.

• Local retailers will continue to grow and international retailers will need to be more adaptive to regional variance in consumption particularly in those areas where the local retailers are posing increasing challenges.

• E-commerce will become even more important for brick-and-mortar retailers as many of them are building their online presence to cope with the competition from the likes of Yihaodian and Tmall.

• A more rationalised approach to store portfolio management. The key retailers will continue to focus on opening new stores to capture more shoppers but many will look to take a more rationalised approach by closing those stores which perform poorly perhaps due to being situated in the wrong location. Both Tesco and Carrefour started to withdraw from some cities during 2011.

• As competition becomes fierce we expect to see retailers being forced to differentiate their offer more by offering unique merchandise and more private label lines.

• Offering different store formats, such as Tesco Express and Sam’s club, will continue to grow in importance as retailers look to attract a different type of shopper and grow their overall footfall.

The Kantar Worldpanel Retailer Flash, which provides quarterly and annual analysis of key retailers by region and city tiers, is now available for subscription. The report, based on continuous tracking of consumer grocery purchases by 40,000 representative households in urban China, allows FMCG manufacturers to closely monitor market movement and formulate fact-based key account strategy.

Notes:

* West 1 region consists of Chongqing, Shaanxi and Sichuan provinces

** East 1 region consists of Shanghai, Jiangsu and Zhejiang provinces

*** North 2 region consists of Beijing, Tianjin, Hebei, Shandong and Shanxi provinces.

The grocery market is growing at 4.2% per year which remains below the food inflation rate as shoppers continue to seek value for money.

Edward Garner, director at Kantar Worldpanel, explains: “There were mixed fortunes among the big four supermarkets this month. The completion of the Netto conversion has led to an all-time record performance for Asda, lifting its share from 16.9% a year ago to 17.5% now. Sainsbury’s has also grown its share to 16.7%, consolidating its strongest hold of the market since March 2003.

“In contrast, there is considerable pressure on Tesco, with its growth rate of 2.1% only half the total market average. This has caused its share to fall by 0.6 percentage points.

“Iceland’s 2.1% share is at its highest for 10 years as shoppers continue to manage down their spending. With bids for the chain closing today, these figures are promising for potential buyers and show the importance of a good value-for-money message in today’s grocery market.”

Elsewhere, Aldi and Lidl continue their strong run, both increasing their shares to 3.5% and 2.5% respectively. However, the disappearance of Netto means that the size of the total discount sector is relatively unchanged at 6%.

Watch the previous commentary here.

Dominic Sunnebo, global consumer insight director, explains: “Apple has continued its strong sales run in the US, UK and Australia over the Christmas period. Overall, Apple sales are now growing at a faster rate than Android across the nine countries we cover.”

Windows 7 is yet to break past a 2% share in any country despite the media attention gained by the new Nokia Lumia range. The Nokia Lumia 800 finished quarter four just outside of the top 10 smartphones sold in Great Britain.

Dominic continues: “BlackBerry remains the brand of choice in the smartphone gifting market, 57% of BlackBerrys were purchased as gifts in quarter four. This rose to 76% during December and a whopping 55% of recipients were under 16, indicating BlackBerry’s hold on the UK youth market.”

Looking at Latin America, it is clear that Android is starting to make a big impact. Although the smartphone market is still in its infancy, Android took a 28% share in Brazil and 20% in Mexico.

Dominic Sunnebo comments: “Brazil and Mexico have a combined population of over 300 million, meaning that the mobile opportunity is huge. By staking an early claim on the smartphone market in these countries, Android is laying important groundwork for future sales from the increasingly affluent middle classes. Over the next few years, Asian manufacturers such as Huawei and ZTE are likely to focus smartphone sales on these regions. Their ability to offer prices under $100 will be crucial to their success.”

In Great Britain, smartphones made up 70.7% of sales over the 12 weeks, meaning that 48.9% of the British population now own a smartphone.

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Edward Garner, Director at Kantar Worldpanel explains: “We continue to see a price war as the big four battle for market share. Tesco’s Big Price Drop has had an aggressive response from its competitors and put pressure on its share, which has slipped from 30.5% a year ago to 30.1%. In contrast, Asda has seen a strong year-on-year performance with its share up from 16.8% to 17.2%. This is in part thanks to the conversion of Netto stores which it acquired earlier in the year.

“Sainsbury’s has also enjoyed a positive year-end performance with its Brand Price Match helping the retailer to grow its share to 16.7%. This is the highest share we have reported for Sainsbury’s since March 2003. Morrisons also achieved growth just ahead of the market and held share as a result.”

Elsewhere, the ‘Two Nations’ divide remains a prevalent feature of the grocery market with Iceland, Aldi, Lidl and Waitrose all performing strongly. The performance of the discounters was bolstered by some Netto shoppers turning to their stores.

Edward continues: “Behind these topline numbers, there is now strong evidence that households are shopping around more. Nearly all retailers can claim to have more shoppers, who are making more trips than last year. However, basket sizes are now smaller – a classic response to tight household budgets.”

Watch the previous commentary here

• Consumer Segmentation: Does your segmentation live and breathe?
• This is a man's world...
• Can Walmart Sustain Its Growth in China Post the Pork Mislabelling Incident?

As the Smartphone market is experiencing such strong global growth, it can be useful to look at shares of the total mobile market to put an OS’s performance into context.  When using the total mobile market as a base, iOS gains share in every country, except Spain (where consumers are reluctant to spend >€50 on Smartphones).  

The success of the new iPhone in Britain has meant that O2 - which has by far the highest proportion of existing iPhone owners - has benefited the most, taking 36.1% of all iPhone sales in the past 12 weeks. However, this has not had a dramatic impact on the number of O2 customers, as the majority of iPhone sales have come from existing O2 iPhone 3GS customers. 3 continue to be the fastest growing network in Britain, with its smartphone share up to 11.1%.

Dominic adds: “Typically Christmas gifting in the mobile market doesn’t really get started until December. Last year just under a third of all phones bought were given as presents and this figure rose to 46% in December 2010. Blackberry handsets were the most popular, making up 40% of the smartphones bought as gifts last December. We think this trend will be repeated in 2011. In fact, 55% of Blackberrys sold this November were bought as gifts.”

Smartphones made up 71.5% of sales over the 12 weeks, meaning that 47.3% of the British population now owns a smartphone.

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Tesco is the only retailer among the big four to see its share slip - from 30.7% a year ago to 30.5% - and its growth rate of 3.8% has also fallen behind that of the market.

Edward Garner, Director at Kantar Worldpanel explains: “This may at first seem disappointing for Tesco given the ‘Big Price Drop’ initiative; however, it is not wholly unexpected. With more products available for less, the amount of cash taken at the tills has understandably dropped. Despite this, Tesco has successfully attracted more shoppers to its stores through the promotion. This strategy, coined ‘self imposed deflation’ by Tesco, is something we have seen in the past and it’s clear that Tesco is using this method again to help shoppers save their pennies.”

Morrisons continues its positive run, seeing share uplift from 12.0% to 12.1%, for the eleventh period running. Asda has also posted its strongest growth since December 2009 as the integration of the UK Netto stores is completed.

Edward adds: “Aldi and Lidl continue to enjoy strong growth helped by some discount shoppers migrating from Netto. However, this growth is below the record levels seen earlier this year and the total hard discount sector has slipped back to 6.0% from 6.2% a year ago.

“Waitrose seems to be immune from economic gloom with prospects of a record Christmas likely, as a result of its traditional seasonal uplift.”

The frozen food revival continues to buoy up Iceland’s performance with year-on-year growth of 11%.

Watch the previous commentary here

Edward Garner, Director at Kantar Worldpanel, explains: “It comes as no surprise that, as shoppers try to control their budgets, an aggressive stance on price is driving retailer communication strategies. We have ‘The Big Price Drop’ from Tesco, ‘The Price Guarantee’ from Asda, ‘Brand Match’ from Sainsbury’s and ‘Price Crunch’ from Morrisons. The end result would appear to be a zero-sum game, as the performances from the big four show only marginal differences this period, with no outright winner.”

All top four retailers posted respectable performances this period. Asda stands out with its growth rate of 5.1% beating market growth for the first time since the beginning of 2010.

The discounters continue their strong run, particularly Aldi with year-on-year growth of 18.8% and an increase of its share from 2.3% to 2.6%. However there are now signs of a slackening of pace as shares and growth rates for both Aldi and Lidl have fallen back from recent peaks.

The economic climate is favouring the value-for-money offering from frozen foods and Iceland has posted growth of 11.6% - the highest since the 2008/9 recession.

Edward continues: “Given the universal emphasis on price across the sector, the big four retailers will need to differentiate themselves. Own-label brands are an obvious way of doing this. We are already seeing double-digit growth for Tesco Finest and substantial revamps for own-label ranges at Asda, Sainsbury’s and Morrisons – suggesting this might be a key battleground going forward.”

An update on inflation

Grocery inflation stands at 6.1%* for the 12 week period ending 30 October 2011. This is an increase on the 5.7% reported last period and continues the rising trend we have seen throughout 2011. However, this remains well below the levels of over 9% we saw during the 2008 recession and it is our view that it is now close to its peak and will decline going into 2012.

Watch the previous commentary here

Samsung however is hot on its heels, with sales of the Galaxy S II and Ace handsets driving its share of Android sales up to 37.9% compared with 25.2% a year ago.  The success of HTC and Samsung has left Sony Ericsson feeling the squeeze as it drops its share of Android sales to just 8.5% down from 20.5% last year.

Dominic Sunnebo, Global Consumer Insight Director, explains: “With so many Android handsets now available manufacturers need to work harder than ever to make their proposition stand out to consumers. HTC and Samsung have market leading flagship products that offer something for everyone.  Sony Ericsson, however, is still playing catch up.  It will need to convince consumers that its products can equal those of HTC and Samsung.

Dominic Sunnebo, Global Consumer Insight Director, explains: “With so many Android handsets now available manufacturers need to work harder than ever to make their proposition stand out to consumers. HTC and Samsung have market leading flagship products that offer something for everyone.  Sony Ericsson, however, is still playing catch up.  It will need to convince consumers that its products can equal those of HTC and Samsung.

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• Online Retailing in China – Getting Ahead of Curve
• Capturing Baby Market Opportunity in China
• High Definition ROI Measurement of Digital Campaign

CR Vanguard Group has been the star performer in the latest quarter seeing a 0.5ppt increase in value share. RT-Mart, combined with Auchan, remains the number one FMCG retail group in China with 8% of the National China market but growth has slowed over the last few quarters.

The Walmart Group’s performance is still been slowed by the share decline of Trust-Mart but this banner has stabilised over the last two quarters. The Walmart banner has had successful quarter, up 0.4ppt compared to the same period a year ago.

Leading Grocery Share of Modern Trade - National Urban China (figures on demand)

• CR Vanguard’s Aggressive Strategy Showing Signs of Success

CR Vanguard was officially established in 1984 and now holds 6.8% value share of National Urban China’s FMCG modern trade market. The retailer had 2,689 stores in Mainland China at the end of 2010 and has an aggressive expansion program focusing on the lower tier cities by acquiring local reputable retail chains as well as opening completely new stores. The Kantar Worldpanel data to Q3 2011 shows that this strategy is paying off with CR Vanguard’s share increasing from 5.6% to 6.2% in prefecture cities and an even more impressive increase from 5.3% to 6.4% in county level cities which has been driven by both the ‘Vanguard’ and ‘Hua Run Su Guo’ banners. In the provincial capitals, where the group has its highest presence, share has also seen significant growth from 10.6% to 11.9%.

• Wal-Mart Banner Leading the Way for Other Western Hypermarket Chains

This is Walmart’s 15th year in China and initially the retailer was focused on growing presence in the top tier cities. More recently the group have focused on expanding the Walmart banner to the lower tier cities through their ‘compact hypermarket’ format which is targeted more to lower income shoppers. This strategy combined with their diverse private label offerings have delivered significant share growth for the retailer particularly in county level cities where share has increased from 2.7% to 4.7% in the latest quarter versus the same period a year ago. 8% of shoppers in county level cities visited a Walmart store in the last 3 months which is close the RT-Mart’s penetration of 11%, the number one modern trade retailer in county level cities. When looking at Tesco and Carrefour we see these two retailers are much more focused in the key cities (SH/BJ/GZ/CD). For example, Carrefour’s share is 10% in the key cities combined compared to just 2.1% in the prefecture cities. In order for these retailers to remain competitive and gain more of a foothold of China’s National market expansion into the lower tier cities may prove to be a successful strategy.

The Kantar Worldpanel Retailer Flash, which provides quarterly and annual analysis of key retailers by region and city tiers, is now available for subscription. The report, based on continuous tracking of consumer grocery purchases by 40,000 representative households in urban China, allows FMCG manufacturers to closely monitor market movement and formulate fact-based key account strategy.

Notes to editor:

Kantar Wordpanel China continuously measures household purchases over 100 product categories including cosmetics, food and beverages and the toiletry/household sector. Its national urban panel covers 20 provinces and four municipality cities (Beijing, Tianjin, Shanghai and Chongqing).

Edward Garner, Director at Kantar Worldpanel, explains: “The gap between inflation and growth has become a major feature of the grocery market as shoppers trade down to cheaper products and retailers strive to convince consumers they are combating inflation. As a result, those retailers with a low price message are the driving force in the market, with Iceland and Lidl enjoying sales growth of over 10% year-on-year, and Aldi leading the market with 25.1% growth.

“Morrisons posted the strongest growth of the big four this period but all of these retailers are responding to stretched household budgets with promotional initiatives. Tesco launched its ‘Big Price Drop’ and Sainsbury’s is responding with its ‘Brand Match’ this week, which will give shoppers a refund coupon at the till if branded products are cheaper at Tesco or Asda. While it is too early to see the effect of these campaigns in the figures, future performance will be critical.”

Asda held share at 17.1% this period which contrasts with the declines seen in previous periods and reflects the inclusion of newly converted Netto stores.

Despite inflationary and budgetary pressures, the ‘Two Nations’ effect continues unabated. Waitrose achieved 9.4% growth this period and the premium ranges at Tesco and Sainsbury’s show double-digit growth, suggesting the traditional trading up at Christmas can still take place.

Watch the previous commentary here

Apple has managed to reach near cult-level status with its keen following and it is this unshakeable loyalty which has driven the brand’s consistent performance. When Apple releases a new device, around 80% of its existing customers in Britain will buy it. Indeed, in the lead up to the iPhone 5 release, a significant proportion of its customers were out of contract but held back from upgrading – 90% of these said they were planning to buy the new model. With well over eight million iPhone owners in GB alone, this level of loyalty can itself sustain a very credible business performance.

While Apple is performing well in the loyalty stakes, other mobile brands are missing this opportunity to drive sales. 40% of GB mobile consumers change their handset every year. However, in the past year, only 35% purchased the same brand when the time came to replace their mobile. So how to retain those customers?

Loyalty is influenced by a number of factors, however, there are three that make a real difference – the customer’s experience on their current mobile; the touch points they use to decide on their next handset; and what product options they are offered before and at the point of sale including pricing, tariffs and distribution.

Apple performs well in all of these areas. Its customers have the highest level of satisfaction with their device and this drives what they want next – if consumers enjoy their handset experience, they are much more likely to purchase the same brand when they upgrade. Added to this, Apple owners are very engaged with their phones and spend 107% more on apps per month than the smartphone average. This is key to its success – when a consumer’s mobile experience is deeply embedded within their day to day lives (through the use of apps, email and maps), the barriers to exiting an OS become ever greater.

Another factor which has helped Apple to secure strong customer loyalty is that it enjoys some of the widest retail distribution in the industry. The Apple brand itself should also not be overlooked. The super brand boasts the largest number of consumers who say the top reason they bought their device is due to the brand.

While retaining its existing customers is a key ingredient of Apple’s success, other brands have placed more of an emphasis on poaching new customers. Sony has achieved the lion’s share of its GB smartphone sales over the past year (72%) by attracting a considerable amount of customers from brands such as Nokia.

This tactic has paid off, resulting in 650,000 additional sales to new customers. However, over the past year, just 14% of its existing customers who upgraded to a smartphone bought another Sony device – the equivalent of just 210,000 sales. If Sony enjoyed the same levels of loyalty as Samsung, which are still around half that of Apple, its smartphone sales from existing customers would have been 600,000 – almost triple what they were in reality. What’s more, convincing customers to repurchase a brand will generally be easier than attracting new customers. This is even the case for brands which are comparatively out of favour.

What is missing is a targeted strategy to address the needs of both new and existing consumers. The one challenge for Apple is ensuring it continues to gain new customers. As each iPhone nears the end of its release cycle and competitors up their game, Apple’s ability to attract new customers diminishes. Although Apple owners were not tempted to jump ship in the lead up to the iPhone 5 release – despite the fact there were arguably higher specification smartphones available – other consumers gravitated towards flagship Samsung and HTC devices. This meant Apple became even more reliant on its existing army of users. This is a luxury available to few other brands and is what helps to cushion Apple’s performance in the run up to a new release.

There are of course occasions when a strategy which prioritises customer loyalty will not pay off and this highlights why acquisition is equally important. Over the past three years, Motorola has seen its customers shrink significantly. Those that are left are mostly older, unengaged consumers – over two thirds are over 50. Targeting marketing spend to encourage these consumers to upgrade to the new smartphone range is likely to yield poor results, as few express any desire to own a smartphone.

To understand the real opportunity of loyalty, companies need to look at the wider picture. Assessing size and experience of their current users, along with their market strength in terms of product range and distribution power can help them to establish the right mix of retention and acquisition strategies.

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Martin Whittingham, director at Kantar Worldpanel explains: “The grocery market continues to deliver solid growth helped by inflation. Consumers are managing their budget by making more shopping trips but buying fewer items on each outing. These changes are at the margin but illustrate how shoppers are trying to cope with the increasing pressures on their household budget.”

Morrisons has once again achieved the strongest growth of the big four, but Sainsbury’s is close behind with both retailers ahead of market growth. As a consequence, they have both gained market share year on year.

Martin continues: “The hard discounters of Aldi and Lidl continue to maintain their double digit growth with a collective 6.0% share of the grocery market. Waitrose, on the other end of the price scale, has achieved growth for the fifth consecutive period in the range 8 to 9% showing that the ‘two nations’ split remains an ongoing theme.”

Watch the previous commentary here

The iPad is the dominant force in the market, accounting for 73% of all tablet sales. This looks set to continue with just over half of potential tablet owners saying they will buy an iPad over the next year. The Samsung Galaxy range is the next popular choice, with 6% of consumers planning to buy this device.

Dominic Sunnebo, global consumer insight director, from Kantar Worldpanel ComTech explains: “While the iPad dominates sales at the moment there is still potential for other manufacturers. Our data shows that 28% of consumers that intend to purchase a tablet in the next year are still undecided about which brand to buy.

“However, Apple’s achievements in this market are clearly linked to its success in the smartphone market. 80% of people who already own an iPhone and plan to purchase a tablet intend to buy an iPad. This is clearly something other manufacturers will have to contend with.” Consumer awareness of tablets is also an important factor in increasing sales. After an advertising blitz last Christmas knowledge of the devices is high, with only 3% of people claiming they have never heard of a tablet.

Dominic continues: “Over a quarter of those who said they have a strong knowledge of the product plan to go and buy one in the next year, compared with only 3% who have a low knowledge. Manufacturers will need to clearly market the benefits of the products, particularly to the older demographic (over-45), who have less understanding of the differences between tablets and PCs.
“One consideration for the future will also be the relationship between smartphones, tablets and PC’s and the necessity of having all three. With tablets and smartphones providing similar benefits to customers and increasingly becoming the same size it may become a case of one or the other. In fact 10% of consumers already remain undecided whether to buy a smartphone or a tablet.”

Other key findings from the study:

• 16% of consumers claim to have a strong knowledge of tablets compared with only 3% who have no knowledge.
• Tablets are most used for reading eBooks and newspapers, using apps and playing games, while PCs remain popular for work and smartphones for instant messaging and social networking.
• The majority of tablet sales use Wifi rather than 3G.
• 90% of tablet owners have connected to a Wifi network at home.
• 41% of people with tablets have used a Wifi hotspot out of the home.
• 43% of tablet owners use their devices while commuting, and 36% when outdoors.

• Paying more, getting more! How are Chinese supermarket shoppers responding to rising prices?
• Shopper loyalty In China - Why Is It so low and what can retailers and manufacturers do to Improve It?
• A fresh look at D city consumers – 4 areas of critical importance uncovered

Edward Garner, Director at Kantar Worldpanel, explains: “It is evident that shoppers are trying to manage their ‘personal’ inflation by trading down. This can be done by seeking out lower priced outlets and cheaper alternative products.

“It’s therefore unsurprising that the discounters have pushed further ahead this month. Lidl has recorded year-on-year sales growth of 13.8% enabling it to retain its record market share of 2.6%. However, the stand-out performance comes from Aldi this month, with growth of 24.4% and an all-time record share of 3.6% - up from 3.0% a year ago.”

The sharp decline of 36.8% for Netto is a result of the store conversions to the Asda brand alongside store disposals, as required by the OFT.

Edward continues: “While the discounters are prospering we are not seeing the shift towards consumers buying more own-label products that might be expected from cost cutting. In fact, budget own-label is showing only muted growth of 2%, while premium own-label is growing at over 8%, confirming that despite economic pressures, low-price is not the only motivation in this market.

“This is further demonstrated by the continued ‘two nations’ theme, as Waitrose shrugs off any gloom with sales growth of 8.3% - over double the market growth.”

This is a challenging market for the big four grocers, which have to appeal to a broad range of consumers, unlike the discount and premium niche players. Only Morrisons has managed to add share this period (11.6% to 11.7%), with year-on-year growth of 4.6% - slightly ahead of the market.

Watch the previous commentary here

The latest data from Kantar Worldpanel ComTech shows that, in the 12 weeks ending 10th July 2011, a whopping 67% of all mobile phones sold in Great Britain were smartphones - the highest proportion of all 12 countries tracked by Kantar Worldpanel ComTech.

Smartphones now make up 50% or more of all mobile phone sales in the US, Great Britain, Australia and Germany, with Italy, Spain and France expected to follow suit within the next quarter.

With the smartphone market clearly buoyant it is Android reaping the rewards with an average market share of 50.6% across the seven key markets of Great Britain, United States, Spain, Germany, France, Italy and Australia. iOS holds second place with an average 25.1% share across the same markets. However, with the launch of the next generation of Apple iPhone seemingly imminent, Apple’s share is likely to grow in the coming months.

In Great Britain, Android continues to lead the smartphone market with 48.8% share, while iOS and RIM battle it out for second place with 20.2% & 19.2% share respectively. Both manufacturers are likely to release new models over the next quarter and with the demand for smartphones seemingly relentless, Great Britain remains a key battle ground.

Global Consumer Insight Director, Dominic Sunnebo explains: “It is easy to assume that because proportionally more Smartphones are sold in Great Britain, there is a higher demand than elsewhere. However, it is important to consider the different market dynamics of each country.

“The two countries which sell the most smartphones (GB and Australia) are also the same two where the highest proportion of smartphones are given free to consumers signing up to contract tariffs (61% free in Great Britain, 44% free in Australia). Consumers find it very compelling to be offered a free smartphone with little to no increase in tariff. This is a very different story in countries like Italy, where the vast majority of the market is prepay, meaning that handset subsidies, if they exist at all, are minimal.”

The findings also show that while it has been a slow start for Windows Mobile 7, there are signs in Germany that consumers are starting to warm to the OS. Windows Mobile 7 now holds 7.1% share in Germany, having sold over 300,000 handsets since launch. While it is predominantly HTC, with its Mozart handset, driving these share gains in Germany, it will be comforting news to Nokia which is due to release its own Windows-based handset towards the end of the year. Windows Mobile 7 share remains in the low single digits elsewhere, but is slowly edging towards selling a million handsets in the all important US market.

Find out more

Read the previous Kantar Worldpanel Comtech report here

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Grocery inflation steadily crept up this period, rising from 4.6% to 4.8%* this month, making it increasingly likely it will reach 5%.

Martin Whittingham, director at Kantar Worldpanel explains: “While we previously predicted that grocery inflation would not exceed 5% in 2011, we believe this no longer to be the case. It has been growing much faster than anticipated and as such we expect it to reach 5% and perhaps go beyond in the next few months. However, unlike the high inflation that we saw in 2008, when it was over 10% in a third of the grocery categories, we are only seeing double digit inflation in a small number of categories.

“The increasing inflation rate is putting extra pressure on shoppers’ ability to manage their household budgets. With this in mind we expect the grocery market to slow in the coming months.”

The theme of ‘two nations’ continues with Aldi and Lidl again posting strong double digit growth of 20.2% and 15.6% respectively. Both retailers now represent 6.1% of the market. Waitrose was the next big winner with growth of 9% and increasing its share from 4.1% a year ago to 4.3%.

Martin adds: “The increasing polarisation of the grocery market looks set to stay as consumers turn to the discounters to cut their budgets while others continue to spend in Waitrose. This divergence seems to be reflective of some contrasting lifestyles in the UK at the moment.”

Morrisons was the fastest growing of the big four retailers with growth of 5.6%, increasing its share from 11.8% to 11.9%. It was also the only big four retailer to grow ahead of the market this period.

Watch the previous commentary here

Global Consumer Insight Director, Dominic Sunnebo comments: “We are yet to see any real signs of consumers switching between Android and Apple. Our data shows that Apple and Android’s customers are intensely loyal when choosing their upgrade. One reason for this is the investment consumers make in their device through apps. In France for example, the average iPhone costs €215, and 17% of iPhone owners download more than 10 apps each month. This investment is then lost if they want to choose a different OS as the apps are non-transferable.”

As a result of growing competition, Apple lost market share in Great Britain this period; it now holds 18.3% in comparison with 30.6% for the same period last year. However, the iPhone 4 has been the top selling Smartphone for the last 12 months.

BlackBerry market share continued to grow in Great Britain - hitting 22.9% in the latest period. The strong appeal of the brand to the youth market shows no signs of abating, with 35.6% of customers aged 16-24. BlackBerry Messenger (BBM) use is key amongst this younger consumer, with 70% of BlackBerry owners, aged 16-24, using the BBM app in the latest four weeks.

Dominic adds: “With 63% of British consumers still owning a non-smartphone, future growth lays with upgrading customers. BlackBerry is currently attracting the most upgrading shoppers with 84.9% of its new customers previously owning a non-smartphone. Our data shows that most first-time smartphone owners look for lower prices. BlackBerry’s competitive pricing allows younger consumers to switch to a smartphone device at a price they can afford.

“However, a concern for brands targeting the lower end of the market is that once consumers have tried a smartphone they are prepared to spend more on their next device and could turn to other brands. With more and more consumers buying smartphones the future for middle-to-high-end smartphones is set to become ever more competitive.”

Although struggling in most countries, Symbian staged something of a comeback in France this period, losing only 3.9% of its share in the last 12 months, despite the French smartphone market growing by 75% year on year. As the second best selling smartphone in this market over the last 12 week period, the Nokia C7 has been instrumental in Nokia’s smartphone revival in France.

Find out more

• RT-Mart seeing consistent share gain in Q1 2011
• How do Chinese consumers react to inflation?
• A time to fight and a time to ride

Read these insights by clicking here

Read the previous Spotlight on China here

Edward Garner, Communications Director at Kantar Worldpanel, explains: “Against this murky background, the ‘two nations’ effect continues unabated. Both Aldi and Lidl have grown at nearly 18% year-on-year and hold onto their all-time record shares of 3.4% and 2.6% respectively. Contrastingly, Waitrose posted the next highest growth at 8.9%. Further evidence for the ‘two nations’ trend is demonstrated by double-digit growth of Tesco’s Finest range.

“The discounters are attracting some new customers but most of their growth is coming from gaining a greater share of the household shopping list. Customers are making a main shopping trip to their favourite store and this is then ‘topped up’ with selective shopping at the discounter – this has been dubbed ‘canny shopping’.”

Elsewhere, Asda suffered a downturn this period dropping its share from 16.7% last year to 16.3%, with the discounters bagging a larger share of its shoppers’ expenditure.

Market share for Tesco, Sainsbury’s and Morrisons remains relatively constant this period at 30.9%, 16.2% and 12.0% respectively.

Edward Garner concludes: “As the household budget remains tight, there is no doubt that many shoppers are adopting coping strategies such as taking advantage of promotional offers or ‘topping up’ at the discounters. However, there is no sign of a return to the rapid growth of budget own-label ranges that we saw in 2008.”

Watch the previous commentary here

The Walmart Group remains the largest grocer in China over the last 52 weeks taking a share of 7.9% and reaching 28% of Chinese households. Total Walmart’s share decline between Q2 and Q4 2010 was driven purely from Trust-Mart. As Walmart converted more Trust-Mart stores to fit with its own merchandising strategy, Trust-Mart’s penetration declined from 7.3% in Q2 2010 to 6.0% in Q1 2011. During the same period, RT-Mart and a number of local retail giants, i.e. CR-Vanguard, Balian etc. are aggressively catching up to challenge the market leader.

The French retail giant Carrefour has shown stagnant share trend in the last four quarters, according to Kantar Worldpanel China. In order to grow, Carrefour will need to find a way to compete with RT-Mart and local players in the lower tier cities where at the moment the retailer has a fairly small presence: just a 2.2% share in prefecture cities and 0.2% share in county level cities. Carrefour saw broad improvement in its share in Q1 in four key cities.

RT-Mart getting it right in the lower tier cities despite pressure from Walmart and Tesco

At an individual fascia level, RT-Mart is the biggest retailer in China with a share of 6.2% share over the last 52 weeks. In prefecture level cities the retailer is most dominant, attracting over one quarter of households and scoring the highest shopping spending across all major retailers. Both of these shopper measures have grown consistently over the last four quarters despite pressure from Walmart and Tesco who are opening new stores in these cities and are growing share as a result. RT-Mart’s growth has come from both food and non-food sectors with Personal Care showing slightly stronger growth for the retailer with a 1.3 percentage point share gain between Q2 2010 and Q1 2011.

Despite RT-Mart’s strong leadership position in the prefecture level cities and county level cities, the market is still very fragmented and therefore offers clear opportunities for competitors to enter without the challenge of a significantly dominant retailer, a situation that is reflected in a lot of western markets.

CR-Vanguard, Balian and Zhongbai all picking up share in provincial capitals

The CR-Vanguard Group has shown consistent share growth over the last 4 quarters which is coming from the provincial capital cities where the group has a much stronger presence with a 10.9% share and attracting over 30% of shoppers to their stores. The Vanguard, Suguo and Huarun SG banners are all contributing to share growth in provincial capital cities over the Chinese New Year period. Similar strong performance was reported for Balian (mainly driven by its Century stores) and Zhongbai in provincial capitals during the latest trading period.

The Kantar Worldpanel Retailer Flash, which provides quarterly and annual analysis of key retailers by region and city tiers, is now available for subscription. The report, based on continuous tracking of consumer grocery purchases by 40,000 representative households in urban China, allows FMCG manufacturers to closely monitor market movement and formulate fact-based key account strategy.

Notes to editor:

Kantar Wordpanel China continuously measures household purchases over 100 product categories including cosmetics, food and beverages and the toiletry/household sector. Its national urban panel covers 20 provinces and four municipality cities (Beijing, Tianjin, Shanghai and Chongqing).

Edward Garner, Communications Director at Kantar Worldpanel, explains: “The market has seen a boost this period, now growing at a far more respectable rate of 4.8% compared to the lacklustre performance we saw in March of 2.6%.

“In the four weeks leading up to 15 May the year-on-year grocery growth rate actually rose to a remarkable 7.8%, bolstered largely by Easter shopping, the good weather and, of course, the Royal Wedding.”

There is further evidence this month of ‘two nations’ developing when it comes to consumer spending, with both the discounters and Waitrose showing strong growth. Aldi and Lidl both continued to power ahead with double-digit growth with Aldi achieving an all-time record share of 3.4% compared with 3.1% a year ago and Lidl holding on to a 2.6% share, equalling the record Kantar Worldpanel reported last month.

With a strong growth rate of 8.8% Waitrose continues to impress, increasing its share from 4.1% over the same period last year to 4.3%, suggesting some consumers are not simply chasing low price.

With speculation rife over potential bids for Iceland the retailer posted strong sales growth of 5.7% and maintained its 1.9% market share.

Edward Garner, Communications Director at Kantar Worldpanel, comments: “A rising tide lifts all boats and the top retailers performed well this month buoyed by the lifted market growth rate. Both Tesco and Morrisons increased their market share to 30.7% and 11.9% respectively, while Sainsbury’s share remained static at 16.3%.”

Asda has felt the pressure slightly this period, posting growth behind the market at 3.5% and dropping market share to 16.6% compared with 16.8% last year.

The Co-operative’s share (including Somerfield) has decreased from 7.4% a year ago to 6.8%. However, this is not a reflection of like-for-like performance as the OFT-directed store sales are still affecting the figures.

Watch the previous commentary here

• RT-Mart went from strength to strength in 2010, while Carrefour faces a tough time
• Uncovering The WHY Behind RT-Mart’s Success
• Four key developments behind China’s UHT Milk Market

Read these insights by clicking here

Read the previous Spotlight on China here

Aldi and Lidl lead market growth this period, with year-on-year sales increases of 15% and 14.7% respectively. Both retailers also achieved all-time record market shares of 3.3% for Aldi and 2.6% for Lidl.

Edward Garner, Communications Director at Kantar Worldpanel, comments: “While the discounters are performing well this trend is not a re-run of 2008 when new shoppers turned to these outlets in response to the recession and 9% food price inflation. Currently, discounter growth is fuelled by existing shoppers sharply increasing their spending levels.

While in comparison to other major outlets Aldi and Lidl’s basket sizes remain relatively small, there is no doubt that these two retailers are now taking a larger portion of shoppers’ spending.”

After the discounters, the next highest grocery growth was posted by Waitrose at 7.7% - providing further evidence that not everyone is responding to economic pressures in the same way.

Major share growth remains elusive for the top four retailers this period with only Morrisons out-performing the market to lift share from 11.8% 12 months ago to 11.9%.

Edward Garner continues: “Last period, the grocery growth rate plunged from 3.9% to 2.6%, suggesting that shoppers’ purses had snapped shut. This period, growth has recovered somewhat to 3.6%. Part of the reason for this is the late timing of Easter in 2011. Seasonal products such as flowers, hot-cross buns, lamb and, of course, Easter eggs all showed sharp decreases over the same period last year as Easter was much earlier. However, this year there may well be a degree of catch-up taking place as Easter markets peak later.”

The latest grocery share figures and comparative data for the last three years are available as an app for the iPhone. To download Kantar Worldpanel’s free ‘Grocer Share’ app please visit the Apple iTunes Store.

Watch the previous commentary here

Grocery price inflation has continued to increase and now stands at 4.0%. This is the first time that the market growth rate has fallen below the inflation rate since July 2009, demonstrating that shoppers are taking an increasingly gloomy view of 2011 and reining in their spending.

Edward Garner, Communications Director at Kantar Worldpanel, explains: “While there are no signs yet of the explosive growth in economy own-label ranges, that we saw in 2008, there are now clear indications that value-for-money is driving retailer performance.

“Both Aldi and Lidl continue their double digit growth from last month, with Aldi increasing its share from 2.8% a year ago to 3.1%. While Lidl grew its share from 2.3% to 2.5% in the same period - this is an all-time record for the outlet. Both performances are being driven by existing shoppers spending more, rather than by new shoppers visiting the stores.”

Similarly, the freezer centres Iceland and Farm Foods outperformed the market, posting sales increases of 4.2% and 11.7% respectively. This growth is driven by customers seeking out value-for-money products – something they know they can get from these stores.

Edwards Garner continues: “While some shoppers have sought value for money this month, not all shoppers shared the same view. Waitrose continued to perform well, posting a higher market share of 4.3% compared to 4.1% a year ago.”

For the Top 4 retailers, the tussle for share continued unabated with only Morrisons marginally increasing its share to 12.2% compared to 12.1% for the same period last year.

Watch the previous commentary here

Dominic Sunnebo, Consumer Insight Director – Global, Kantar Worldpanel ComTech says: “If you have any interest in technology, the phenomenon that is Android is unlikely to have passed you by. It has been widely reported that Android is challenging the traditional dominance of Apple’s iOS, RIM and Symbian in the smartphone sector, but our market share figures reveal that far from playing catch up, Android is now dominating the sector in many key territories.”

The vast majority of new Android and Apple iOS consumers came from a non-smartphone background. For example in Great Britain 74.9% of iOS and 73.8% of Android’s new customers previously owned a non-smartphone. However there is some switching between the smartphone manufacturers, with 17.3% of new Android customers coming from Symbian, 6.3% from Windows and 1.6% from RIM.

Dominic explains: “What is clear is that neither Android nor Apple’s iOS are currently stealing many customers from each other - Symbian, RIM and Windows beware. At Kantar Worldpanel ComTech we are able to see what impact switching to a new OS has on a consumer’s usage of their smartphone. For example, in Germany switchers to both Apple’s iOS and Android hugely increase their usage of data heavy functions including the internet and GPS. However, what is interesting is that existing iOS customers were already using advanced features more than Android customers, and continue to show higher usage on iOS platforms compared to Android devices.

“One reason for this may be that in Apple’s case, by keeping total control of the product that reaches the end user, they are able to ensure the functionality is exactly as it should be. In Android’s case, where the OS is on multiple devices by multiple brands, it is inevitable that some users will get a different experience of the OS than others. For example, a far higher proportion of consumers who own a HTC device download / use apps compared to those who own a Samsung Android mobile.”

Interestingly, whilst the new CEO of Nokia plans to phase out the Symbian platform over the coming years, it is still generating substantial sales in a number of countries, such as Italy and Germany where it is number one in the Smartphone OS market, commanding 49.8% and 30.5 % of share respectively.

Dominic continues: “Nokia’s recently announced strategic partnership with Microsoft means they are looking to Windows 7 to spearhead them both back into becoming a serious force in the smartphone sector. Whilst it is still undoubtedly early days, Microsoft continues to lose share in all key country markets – we eagerly await the first Nokia Windows device to see how this will shake up the market.”

Country specific OS market share data:

Great Britain – BlackBerry (RIM) has shown rapid growth over the past year, and now hold second place in the smartphone market with 23.3% share, below Android on 37.4% but marginally higher than iOS on 22.0%.

USA – In BlackBerry’s historical stronghold it has lost market share with a drop from 32.5% in the 12 weeks to 13th June 2010 to 12.9% in the latest period. The unprecedented growth of Android is highlighted in the US market as it now holds a 55.1% of the market share.

Germany – Symbian remains the number 1 Smartphone platform, with a 30.5% market share, but this is down from 47.3% one year ago. Android has seen a steady increase in its share of the market, currently at 28.8%.

Italy – The Italian market is dominated by Symbian with a majority share of 49.8%. Apple’s iOS and Android are almost neck and neck with 16.7% and 17.2% market share respectively.

France – France has seen tremendous change over the last three months with Android leap frogging both iOS and Symbian to take lead the market with a 32.5% share.

Australia – In October last year iOS over took Symbian for the first time and currently has 29.9% of the market, with Android laying claim to only 29.7%.

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Walmart group remains in front, while Carrefour struggles

The Walmart Group remains that largest modern trade retailer in the latest quarter taking a share of 7.5% and reaching 18.4% of Chinese households. With Walmart and Trust-mart combined, the group holds an advantage over CR Vanguard at 6.7% in the latest quarter but this leadership position has been eroded down from pervious quarters. When split between the two banners it is clear that the Walmart branded stores have remained consistent, outperforming the modern trade sector over the last three quarters and the challenges with integrating Trust-Mart is the key area where share was being lost. Trust-Mart saw its share drop from 3% to 2.2% from Q3 to Q4.

The French retail giant Carrefour continued to struggle with its performance in 2010, showing stagnant share trend in the last three quarters, according to Kantar Worldpanel China. Faced with intensified local competition, Carrefour started to retrench in some cities by closing poorer performing stores.

RT-Mart keeps expanding its foothold in lower tier cities, but will face growing competition from its rivals

At an individual fascia level, RT-Mart is the biggest retailer in China with a share of 6.2% in Q4 2010. Traditionally strong in lower tier cities, RT-Mart continues to strengthen its leadership position within Prefecture and County level cities. In January 2011 alone, 7 out of the 10 new stores opened by RT-Mart are located in prefecture level cities or county level cities.

However as the market attention shifts inland and towards these untapped city tiers, both local and multi-national retailers have begun to aggressively focus resources on these territories. Whilst RT-Mart holds a clear advantage as number 1, the fragmented nature of the market still offers clear opportunities for competitors to enter without the challenge of a significantly dominant retailer, a situation that is reflected in a lot of western markets.

CR-Vanguard and Zhongbai outperformed other local players

CR-Vanguard, while continuing its expansion into the high-end sector with its Ole premium brand in key cities, maintained its strength in the mass market by opening more than 400 stores across the country in 2010. Zhongbai, another key local player based in Hubei, also reported 0.3% share point gain in Q4 by accelerating its store opening in Hubei and nearby provinces. Both benefited from their aggressive low tier city expansion strategies.

The Kantar Worldpanel Retailer Flash, which provides quarterly analysis of key retailers by region and city tiers in China, is now available for subscription. The report, based on continuous tracking of consumer grocery purchases by 40,000 representative households in urban China, allows FMCG manufacturers to closely monitor market movement and formulate fact-based key account strategy.

Notes to the Editor:

Kantar Wordpanel China continuously measures household purchases over 100 product categories including cosmetics, food and beverages and the toiletry/household sector. Its national urban panel covers 20 provinces and four municipality cities (Beijing, Tianjin, Shanghai and Chongqing).

• China’s FMCG market continues to surge
• How are consumers coping with inflation spike?
• One country, many markets

Read these insights by clicking here

The Best Companies annual survey is the largest of its kind with over 275,000 employees across diverse industries participating in 2011.  Competition was fierce with 1,165 organisations applying to achieve ‘Star Status’ accreditation and 818 being successful.  In total only 498 organisations were awarded ‘Star Status’. Alongside Kantar Worldpanel UK big guns Boots, Lloyds bank, Virgin Money and McDonalds were among the many companies listed.

The Sunday Times has been publishing the annual lists of the best companies to work for since 2001 and the accolade is highly regarded by employers and employees alike. Host, BBC Breakfast presenter Bill Turnbull called the event an opportunity to "celebrate a triumph".

What makes the award particularly special is that the ranking is based purely on the confidential surveys completed by the employees, with the result clearly displaying Kantar Worldpanel’s continued commitment to providing the very best working environment within the UK. Minister for Employment Ed Davey commended all for responding with clarity to employees in the current climate.

Managing Director Tim Kidd, commented 'It's an honour to be counted among the best companies to work for in the UK'

Kantar Worldpanel is the world leader in consumer knowledge and insights based on continuous consumer panels and offers market monitoring, advanced analytics and tailored market research solutions to a vast range of retailers, brands and industry. The UK operation is its largest with over 500 employees.

The full list of companies in The Sunday Times 100 Best Companies to Work For will be published on Sunday 6th March.

Within the big four retailers, Sainsbury’s has had a strong entry into 2011 and is once again the only outlet to increase market share, from 16.3% a year ago to 16.6%. Among the other major grocery retailers Tesco and Asda have effectively matched market growth and held onto share but Morrisons has experienced a slight dip this period from 12.5% to 12.4%. However, it should be acknowledged that it is faced with strong year-on-year comparatives as its 12.5% share in January 2010 was a record performance for Morrisons.

Elsewhere in the grocery market, two contrasting sectors are experiencing robust growth. Edward Garner, Communications Director at Kantar Worldpanel, explains: “With growth of 7.1%, Waitrose continues to benefit from strong sales at Christmas, boosted by new shoppers this year at both existing and new stores. However, with a group of shoppers tightening their purse strings and seeking value we’re also seeing a counter trend at the other end of the retail scale. Although January is not traditionally a strong period for the discounters, both Aldi and Lidl have posted near 10% growth and lifted the total discounters’ market share from 5.9% last year to 6.1% in the latest period.”

The Co-operative has lost 0.6% market share in the latest period as a result of direction by the Office of Fair Trading to sell-off some Somerfield stores. However as Somerfield has now effectively ceased to exist, going forward the market share of The Co-operative will be a more accurate reflection of its performance. Finally, Iceland’s strong run has come to an end with year-on-year growth held at 2.1%, reflecting a flat performance for the frozen food market overall.

Watch the previous commentary here

While the grocery sector enjoyed a prosperous Christmas with respectable growth of 5.1% this period, the non-grocers suffered a 2.3% decline in sales. This echoes the gloom of the latest Christmas trading reports from a number of non-food retailers.

Edward Garner, Communications Director, Kantar Worldpanel, comments: “Widespread disruption caused by the heavy snow before Christmas meant that many consumers only ventured outdoors for essential grocery shopping trips this year. The high streets are usually at their busiest over the festive period but this Christmas shoppers chose instead to stock up on non-food items such as DVDs, toys and books while doing their grocery shop. Increased spending levels rather than shopper numbers were therefore the driving force behind the strong growth of the grocery sector this period.”

Historically Sainsbury’s prospers over Christmas as shoppers trade up to more premium ranges. This year was no different, and crowning a period of consistent growth begun in 2004 Sainsbury’s was the only Top 4 retailer to increase its market share this period – from 16.3% a year ago to 16.6%.

Tesco effectively matched market growth and so its share remains unchanged at 30.5% but both Asda and Morrisons experienced small drops in share of 0.1%. Nevertheless, premium own-label ranges across the Top 4 grew by 11% year-on-year, a good measure of positive consumer sentiment pre-Christmas.

In a similar vein, Waitrose enjoyed robust growth of 9.4%, helped by the considerable media buzz around its Delia Smith and Heston Blumenthal recipe offering. This added to the 16.5% growth seen for the Christmas 2009 period.

After a turbulent few months the Discounters Aldi and Lidl grew ahead of the market this period with spend levels increasing sharply. This is perhaps due to the convenient urban locations of the outlets against a background of disruptive weather, and some shoppers still seeking value for money during a traditionally expensive month.

Kantar Worldpanel, which continuously measures consumer purchasing and usage habits of a representative sample of households in the UK, will increase its panel size by 20% from 25,000 to 30,000 households, being fully in place by the end of 2011.

Specific improvements to services include the ability to bring together data collected on what people purchase with what people consume, currently sourced from separate samples. In addition, the measurement of panel members’ internet activity will be better facilitated along with the capacity of the LINKQ service which will increase to allow clearer understanding of why people behave as they do, to better meet client demand.

Tim Kidd, Managing Director, Kantar Worldpanel UK & Ireland explains: “The benefits of this expansion are that it will enable us to expand and update our range of services, and at the same time significantly improve the accuracy of our data. Our ability to comprehensively explore what consumers and shoppers do and why they do it will be enhanced – allowing our clients to make sound business decisions based on genuine, accurate and timely research.”

The announcement was made at the company’s annual client conference on 25 November 2010. The data arising from the panel provides comprehensive panel viewpoints that build a complete picture of consumer behaviour in the UK, along with demographic and regional data it provides valuable insights, as well as market and trade trends which help businesses to shape future commercial strategy.

CR Vanguard Group and RT Mart follow in second and third position, with 2.9% and 2.7% share respectively. However, the top 5 retailers only account for 13.4% share, highlighting the opportunities for mergers and consolidation in coming years.

Jason Yu, General Manager for Kantar Worldpanel (China), said: “In China, the modern trade currently represents only 46% share of the FMCG sector, so it is no surprise that most retailers continue to accelerate new store openings and formats to strengthen their position in this rapidly growing market. So far, there is no dominant national player – a reflection of the fact that local chains are increasingly competitive and often have a significant stronghold in certain regions.”

Market still fragmented, and reach of retailers is restricted by the geographic challenges

“The Chinese market remains highly fragmented compared to it’s Western counterparts” continues Yu. “In the Hypermarket channel, RT-Mart, with 129 stores*, have a 2.7% share, with Carrefour (156 stores*). Walmart (175 stores*) close behind with a share of 2.3% each. With the current store portfolio, all three major hypermarket chains are still only able to reach just less than 15% of Chinese households, due to the immense geographic distance between cities. Hence all major retailers intend to open more stores in the coming 3-5 years to gain a bigger share of increasing consumer wealth.”

Competition varies by city tiers and regions

Most global retailers started market entry from costal provinces and first tier cities, gradually expanding to the emerging lower tier cities and inland provinces. Their market shares, therefore, typically reflect this pattern of expansion. For example, Carrefour holds 5.2% share in municipalities and provincial capitals (the top 25 cities), yet only 1% share in prefecture level cities (B cities) and 0.1% in county level cities (C cities). However, RT-Mart, who overtook Carrefour as the biggest Hypermarket operator in retail sales in 2009, adopted a different expansion strategy. It only records a 2% share in the first tier cities, but leads by a significant margin in prefecture level cities and county level cities, with 4.4% share and 3% share respectively. With domestic consumption playing an increasingly important role in the development of lower tier cities, RT-Mart clearly has a “first to market” advantage to capitalise on the retail boom in the prefecture level cities.

Kantar Worldpanel China also reports that the competitive landscape varies substantially by regions. For example, the state-owned conglomerate Bailian group is the leading retailer in the East region, with 6.3% share, while Walmart enjoyed leading position in the North and West. Regional competition, mainly from local retailers, will be significant barriers for Walmart to duplicate its success elsewhere.

County level cities and counties – the new frontiers for modern trade

Modern trade is taking a hold in China thanks to the lure of low prices, convenient one-stop shopping, accessible locations and the integration of other retail facilities in the major cities in China. Hypermarket and supermarket combined, already account for 53.9% share in the municipalities and provincial capitals. Yet it only reports 39.3% share in county level cities and 34.9% share in counties. In counties and county level cities, traditional grocery stores, free markets and direct sales still make up a significant part of the consumer purchases.

In counties, local retail giants, e.g. CR Vanguard and Balian have established an initial presence, with a 2.5% share and 0.8% share respective. The modern trade is still characterised largely by small scale, locally operated supermarkets and minimarkets. Mr. Yu said: “our data indicates there is plenty of room for modern trade retailers, especially chained supermarkets and mini-markets, to move into this new frontier.’’

In 2010, for the first time, Kantar Worldpanel China launches its National FMCG Retailer Flash to provide measurement of key retailer performance by region and city tiers. Kantar Worldpanel China measures the daily grocery purchasing of 40,000 demographically representative Chinese urban households through cutting-edge barcode scanning methodology.

Notes to editor:

1. Kantar Wordpanel China continuously measures household purchases over 100 product categories including cosmetics, food and beverages and the toiletry/household sector. Its national urban panel covers 20 provinces and four municipality cities (Beijing, Tianjin, Shanghai and Chongqing).

2. Store count numbers are sourced from China Chain & Franchise Association, published on March 25th, 2010

3. Penetration: Percentage of population(households) shopped in a given time period.

If you're a member of the media looking for data or commentary from our experts, please contact Linda Zhang at 86-10-82015388-8603 or zhangfengjuan@ctrchina.cn

At the same time, the Discount Retailers have lost some ground, as some of their customers have gone back to the traditional stores. The Discount Stores showed the first signs of fatigue just as the economy as a whole started to improve at the beginning of 2009, and their fall has only become more marked since then. Despite the opening of new points of sale and the expansion of some stores, the Discount Stores as a whole have lost customers. The average basket of shopping from Discount Stores dropped from €23 to €22.7 while customer loyalty also dropped from 20.6% to 20.4%.
While the 5 discount chains are still in the lead when it comes to the latter (Lidl in first place, far ahead of the classic retailers), they have all been punished by their customers this year, who see the price gaps between them and the traditional supermarkets as less attractive. Furthermore, they have also suffered substantial loss of turnover in favour of the traditional stores. The first to benefit from this is still E. Leclerc.

Super- and hypermarket customers frequent fewer stores (5.4 v. 5.6 the previous year), and the frequency of visits to stores remains the same, which highlights the fragility of the recovery.

The distribution landscape continues to evolve: some shops expand, new points of sale open, others change brands and new concepts emerge. Distributors are chasing the targets that grew last year, and are developing local chains for some and mega-stores for others.

Price is still the main battleground, and many stores have lowered their prices, and have let everyone know. They have not skimped on using different ways to let people know that they are “the cheapest”. The leading retailers have again deployed major communication resources and have often added to the investments made last year. The total sum invested by supermarkets in advertising is 1,298 million euros, according to Kantar Media’s figures.

Promotions continue to exert intense pressure, as do the overall number of flyer campaigns that rose by 316 additional campaigns (source: A3 Distrib), under the guise of numerous events (anniversaries or others) that have been launched this year. The effect of the loyalty card is therefore waning and all the retailers have suffered when it comes to their ability to propose new promotions or the perceived advantages of their store cards.

It is not easy to make a link between the stores’ efforts to seduce customers (which have been particularly intense this year) and how their customers actually perceive them. It is not the stores that have invested the most that have most improved their overall image. Supermarkets have the edge, while Hypermarkets fall back in terms of overall image.

The three winning retailers this year are: E. Leclerc, Carrefour Market and Système U. But only E. Leclerc and Système U are capturing customers and gaining their loyalty.

E.LECLERC, maintains its leadership with a market share of 17.1% and this year has won 0.5% in share of market value. Strengthened by the arrival of new stores into its network (E. Leclerc Express, E. Leclerc Drive), the retailer continues the conquest of new customers that it began last year.
The success of E. Leclerc is firstly due to its price perception, which continues to progress, but also to the E. Leclerc Ticket, the loyalty card that holds strong appeal for its customers, and to its Repère brand, an important weapon in its growth strategy.

CARREFOUR MARKET, the Champion of the Carrefour group, with 0.4% of additional market share, is the second most dynamic supermarket chain. This success can be explained by two factors: the recruitment of 732,800 households that have come to swell the ranks of the clientele, and the development of customer loyalty. Carrefour Market has benefited from the strong points of Carrefour, notably its Own Brand, which is growing thanks to its themed ranges and to the clear success of Carrefour Discount, which has allowed it to improve its price perception and to attract lower-income families.

SYSTÈME U: in 10 years, the store has increased its market share by 2.7%, and this year passed the symbolic threshold of 9%. The chain has attracted 287,000 more customers in 2010, taking advantage of the opening of several new U Express local stores. Furthermore, Système U continues to persuade its customers to spend more at its stores. Thanks to high shopping frequency, with 23.2% visits per year, Système U is the shop most frequently visited by customers in France.

Système U is perceived as a shop that is pleasant to visit and it is the preferred supermarket of French shoppers.

The situation of other retailers:

INTERMARCHE: a forty-year old that continues to mature. Stable in terms of market share (12.0%) over the year, despite intensive media exposure on the occasion of its fortieth anniversary (September/October 2009). Boosted by its increased store numbers, Intermarché gained 185,000 customers, but lost out on loyalty. Its Own Brands are still a major growth factor for Intermarché, but its price perception has dropped back.

CARREFOUR: victim of Carrefour Market’s success, but not only that. In a context that is not favourable to Hypermarkets, Carrefour is the retailer that has lost out most on market share (-0.3%). The store has lost customers, its customers are less loyal and the 50th anniversary did not have the hoped-for effects. To these difficulties, we can also add the competition posed by Carrefour Market. Many of the customers it has lost have found the same products, promotions and loyalty advantages at Carrefour Market (and maybe closer to their home) as in their usual Carrefour. 
A tough year, but let’s not forget the positives: thanks to its Carrefour Discount brand and its « PromoLibres », Carrefour’s price perception has improved. Carrefour has attracted lower-income families and the loss of turnover to other Discount stores has been curbed, while loss to Système U has been greatly reduced.

GEANT and CASINO: the supermarkets and hypermarkets of the Casino group have seen their market share fall (by -0.2% and -0.1% respectively). Loss of customers, loss of customer loyalty, a bad price perception, Own Brands that are losing ground: both stores have suffered, but particularly Géant, which has been falling for several years now.

Stores in the AUCHAN Group: Auchan has taken the opposite course to that of its competitors and has staked a bet on the mega-hyper format. It is the only store with this format that has managed this, remaining stable in terms of market share. The store is losing customers, but those that come stay loyal. And above all, Auchan has improved its price perception.
Simply Market struggles to prove itself, but its radical change of concept has allowed it to attract and keep younger customers.

*The Référenseigne Expert Kantar Worldpanel 2010 is calculated on a universe of Hypermarkets + Supermarkets + Discount Stores + Convenience Stores), with a basket of Fast Moving Consumer Products and Self-Service Fresh Products (Groceries, Drinks, Hygiene/Beauty, Entertainment, Dairy, Frozen Foods, SS Cheeses, SS Cooked Meats, SS Delicatessen, Marinated and Smoked Fish) and on the basis of mobile annual trends up to mid-June 2010, as compared with 2009.

When citing data, quote source: Kantar Worldpanel Référenseigne Expert 2010

The new free app is available to download now from the Apple iTunes Store. Called ‘Grocer Share’, it enables users to access the most up to date sales and market share figures for all the major UK grocery retailers. Users can also use the app to obtain data for the last 3 years, a useful tool when tracking the historical performance of a retailer.

Ed Garner, Communications Director at Kantar Worldpanel, explains: “We’re excited to launch our app as it will enable businesses and media to access the latest intelligence on the UK’s major grocery retailers 24 hours a day.”

It will be updated each month with the publication of Worldpanel’s latest grocery share figures. All this data is available in simple charts which users can email to themselves or colleagues in a single click. The app also features a section with the latest news on the grocery industry, video commentary and contact details should users require more information.

The latest grocery share figures will be available on Kantar Worldpanel’s iPhone app on Tuesday 17 August.

In 2009 supermarket brands were a safe investment, advancing more strongly than in the past and settling at almost 33% of consumer sales. Discount stores set the pace and no longer benefit from the dynamism of the national brands introduced by some retailers – their market share has remained stagnant at around 14%.

Against this background of streamlining purchases, when the French public continued to pay close attention to prices, many brands have not thrown in the towel, but have progressed. The most developed brands have continued to invest in communication, mostly to support product innovation. The same good marketing strategies still give the same good results.

Simplicity and convenience had a big impact on the French consumers’ choices in 2009. This was shown by their choice of store in which to do their shopping, and they preferred to frequent the supermarket closest to home than to go further afield, as long as the prices were reasonable: Leclerc, Système U and Carrefour Market were the 3 leading retailers in 2009.

Isabelle KAIFFER, Director of Marketing & Communication at Kantar Worldpanel comments: “In terms of product choice, simplicity was expressed by ‘let’s eat something simple, which needs a bit of preparation but not too much’. A typical example is a homemade quiche, but with a ready-made pastry. It’s not completely home-made but neither is it bought ready-made. Bread and chocolate or a pastry to spread a topping on for taste are preferred rather than more sophisticated biscuits. In the same way, basic products like meat and fresh fish have held up better than in previous years. It’s so easy to cook a steak… ».

France is still France, and pleasure is a strongly-held value, as demonstrated by the increase in purchases of foie gras, alcohol and chocolate. We might be tightening our belts, but we still know how to enjoy ourselves…

What is the outlook for 2010?

First quarter figures are encouraging. Sales of fast-moving consumer items grew by 2% over the same period last year, both in terms of volume and value, while prices remained relatively stable.
2010 should progress at a rate of around 1-2%, the pace of growth recorded before the 2008 recession.

The beginning of 2010 has also shown signs of consumerism slowing, with the following significant points:

• Supermarket own brands have fallen back slightly to 32.4% of the market share (compared with 33.1% in the first quarter of 2009),
• Discount supermarkets declined slightly from 14.4% to 13.9% between the first quarters of 2009 and 2010.
• The “expensive” markets (more sophisticated or providing the consumer with additional services) which had suffered during the recession have recovered with economic growth: notably, the fresh deli sector with fresh ready meals grew by +14% in volume from the 1st quarter of 2009 to 2010, and fresh salad grew by +7%.
• Lastly, organic produce is continuing to grow.

But growth is not there for everyone in France: young people under the age of 35 are increasing their spending the most (4% more in the 1st quarter of 2010 compared to 2009), the over-50s are more restrained (+1%), and the 35-49 age group are spending no more than they did last year. For the latter, families with children in which the shopping budget is more significant because there are more mouths to feed, caution is the watchword. There is the same contrast between the wealthier half of the French population (+4%) and the poorer half, where the shopping budget remains exactly as it was.

The emergence of “recession” products such as ready meals based on tinned pasta (ravioli, etc.) at +7%, tinned mackerel (+15%), or the most basic products such as eggs (+6%) or ham (+7%), can also be seen.

While the brakes are put on spending on expensive products (household items, clothing, etc.), fast-moving general consumer products remain an area where more stability is guaranteed: you will always continue to eat, even if you have to budget more carefully and be more “sensible”, but also remembering to keep some moments of simple pleasure. It’s an evolution, not a revolution. Common sense, and pleasure…

Despite an ever-growing number of retail outlets and rising investment in advertising, the Hard Discount (HD) channel showed its first signs of fatigue just when the economic environment was beginning to improve at the beginning of 2009. This slowing growth in the first quarter was followed by eight months of decreasing market value share. Hard Discounters closed the year with 14.1% of market share, compared with 14.3% in 2008 — a significant drop.

Despite the opening of new stores, the process of securing new customers has run out of steam. This year, the Hard Discount sector has not expanded its customer base, which has reached a ceiling of 72%. Some types of household have even abandoned the channel. HD customers allocate only 20.4% of their spending to this channel, with a decreasing average shopping basket and a stagnating frequency of visits.

At the first signs of a more favourable economic context, French households have found their way back to the small Hypermarkets, a format that they appear to like and one that has also been boosted by some signs of dynamism. Leclerc, Carrefour Market, Système U and Intermarché are playing the “choice” card by opening or enlarging their small Hypermarket stores and this, coupled with a certain proximity to their customers, has meant a double-win for them over the last few months.

In 2009, the Hard Discount channel suffered from competition from the classic retailers, to which it yielded some of its turnover.

More than ever, the traditional retailers have played their Own-Brand card (Standard and Themed), which once again this year, have encroached on the territory of National Brands. The latter are also no longer the engine that drives HD and their value is no longer growing in this channel. HD is even losing ground to traditional Low-Cost Supermarket Brands, particularly to Carrefour Discount.

The retailers that have come out best this year in general are the German HD retailers: Lidl and Aldi have succeeded in stabilising their market share, although they are not making any more headway.

Lidl’s market share stagnated at 4.8%, as the store maintains its relatively low customer fidelity. The number of customers continues to increase, but the pace of customer recruitment has slowed down. The store’s approval rating remains the same, although for the last two years Lidl has lost its place as the preferred HD retailer in France to Aldi.

As regards Aldi, with a market share of 2.5%, it is the only HD retailer to be winning over new customers and building customer loyalty at the same time. It has even won revenue over from Lidl!

Meanwhile, the French HD retailers are suffering more from this situation and Leader Price, Ed (Dia) and Netto are struggling.

Gaëlle Le Floch, Director of the Retail Unit at Kantar Worldpanel highlights: “Is this return by French households to the traditional retailers a sign that they have fallen out of love with Hard Discount? Although their approval rating had jumped to 6.4 points last year, this year it has dropped 1 point. While Hard Discount maintains its leadership in terms of price image, it is still in decline on this point, as it is on the ‘improves my spending power’ factor, the strongest decline in terms of its image. In a context in which traditional stores have applied the Economic Modernisation Law and have dropped their prices, the competitive advantage of Hard Discount retailers has lost some of its impact and undoubtedly explains the fall in their overall image.

This would provide proof that when the price gap between traditional retailers and Hard Discount retailers is judged by consumers to be insufficient, the perceived difference in stores’ services and convenience grows. Just as the Hard Discount channel is losing credibility on the price dimension, it comes in for even greater punishment on the other factors…”.

*The Kantar Worldpanel Hard Discount Report 2010 is based on a universe of large and medium-sized retailers (Hypermarkets + Supermarkets + Hard Discount + Minimarkets), and on a set of Fast-Moving Consumer Goods and Fresh Self-Service Products (Groceries, Liquids, Hygiene and Beauty, Cleaning Products, Dairy, Frozen Foods, Self-Service Cheese, Self-Service Cooked Meats, Self-Service Delicatessen and Smoked Fish), and on the year 2009 as compared to 2008.

When citing data, quote source: Kantar Worldpanel Hard Discount 2010

Kantar Worldpanel specialises in providing actionable insights into consumer purchasing and usage habits on a local and global scale in fields as diverse as FMCG, entertainment, communications, petrol, fashion, beauty, baby and food-on-the-go.

In addition to the name change, Kantar Worldpanel is introducing a fresh and dynamic new logo. Central to the new brand is a visual device, which acts as a framing mechanism to zoom in on what is really important. It represents a visual symbol for the company’s breadth and depth of analysis, the clarity and focus of its insights and the ability to use data to see beyond the obvious.

A new strap line – high definition inspiration – summarises Kantar Worldpanel’s capabilities to turn complex data sets into exciting insights that inspire clients to take their business to new levels.

The rebrand will not result in any changes to the client service teams, panel sizes, methodologies or data delivered previously by TNS Worldpanel.

Josep Montserrat, Kantar Worldpanel’s Chief Executive commented: “Our new name and branding marks quite a substantial change to our business, to how we see ourselves and to how we want to be perceived in the market. It is a great opportunity not just to re-enforce our strengths in providing actionable insights but also to demonstrate to our clients how they can benefit from high definition inspiration.”

“Today, Kantar Worldpanel is the only company 100% dedicated to inspiring our clients through consumer panel research. This specialisation enables us to develop our unique portfolio of solutions and best-in-class service across our worldwide network - to provide more value to our clients”.

He added: “This change also means we can enjoy even more benefits of being part of such a large group of companies. We want to build on this and are looking further into ways of working in partnership with the other Kantar businesses.”

Worldpanel was a part of TNS, the global custom and syndicated market research business, which was acquired in 2008 by WPP. Following this and a major restructure of the Kantar group of companies, it was announced in spring of 2009 that TNS Worldpanel would be integrated into Kantar - the information, insights and consultancy side of WPP’s operations.