Confirming the opportunities for Irish Suppliers within the UK

© Kantar Worldpanel

Confirming the opportunities for

Irish Suppliers within the UK

Gluten/Wheat Free Market

Data ending 52 weeks17th February 2013

http://www.geniusglutenfree.com/


30,000 GB Households

continuously reporting

their purchasing

Demographically Representative

Social Class

Main Shopper Age

Number of Children

Size of Household

Region of residence

2

Key Areas Purchase Data can be

Used

1. Understanding the shopper and

their behaviour

2. Building trade relationships

3. Growing Brands/ Category

4. Gaining & protecting listings

Purchase

KANTAR WORLDPANEL METHODOLOGY

4


KANTAR MARKET DATA IS THE CURRENCY WITHIN THE INDUSTRY

http://www.geniusglutenfree.com/

http://www.premierfoods.co.uk/


5

How big is Gluten Free and how

does it perform?

Which sectors are best to play in?

Where are the retailer opportunities?

Which shoppers should we go after?

Who are the key brands?

6


GLUTEN FREE

GF BAKERY

7


DEFINITION OF KANTAR GLUTEN/ WHEAT FREE MARKET

Any product with (GF) / Wheat Free (WF) in the barcode description

and well known GF Brands. Termed Gluten Free as all Gluten Free is

also Wheat Free

ALDI GF HAM JOINTS

DEBBIE AND ANDREW GF SAUSAGES

KALLO ORG GF RICE CAKES

NAIRNS WF OAT CAKES

MR MASH GF

TESCO FF CHEESE

YOUNGS FF FISHFINGERS

For example:


How big is Gluten Free and how

does it perform?

9


£180m

+37%

Shellfish

Tinned Fruit

Same size as:

Total

Grocery

+3.7%

Total Free

From +24%

Larger than:

Nuts

Herbs& Spices

Lemonade

52 w/e up to 17th February 2013

Extra £48m

GLUTEN FREE: MEDIUM SIZED, EXCEPTIONAL GROWTH

GLUTEN FREE

10


SHOPPERS DRIVE OVER HALF OF GROWTH, DEMONSTRATING AN

APPETITE FOR GLUTEN FREE (GF)

42% of HHs

18%

6 trips a year

+8%

1.7 packs

+2%

£1.65

+4%

£12m £3m £6m

Penetration Frequency Trip Size Price / pack

£27m

*Penetration contributions includes Population growth of 1%

GLUTEN FREE


11m

HHs

11


IN THE LAST YEAR, MORE AND MORE SHOPPERS HAVE ENTERED

THE MARKET AND BASKET SIZES HAVE INCREASED

-10,000

0

10,000

20,000

30,000

40,000

50,000

60,000

Con

trib

utio

n

Frequency Trip Packs Price per Pack Penetration (%) Total Contribution (£000s)

Accelerated growth

GLUTEN FREE


12


Contr

ibution to Y

OY

%

Asda Free From

Debbie & Andrews

Marigold

Mrs Crimbles

M+S

The Black Farmer

Dietary Specialities

Doves Farm

Kallo Organic

Doves Farm Organic

Kallo

Nairns

Naked Food Co

M+S Free From

Sainsbury Freefrom

Aldi

Genius

Look What We Found

Warburtons Gluten Free

Tesco Freefrom

All Others

TESCO FREEFROM DRIVE A HIGH PROPORTION OF GROWTH IN

GLUTEN FREE BUT THE OVERALL IMPACT OF THE SMALLER

RANGES CONTRIBUTE THE MOST

Only splits out top 20 ranges


GLUTEN FREE

13



14


Which sectors contribute the most to Tesco Free From

growth?

Liquid Dairy Alternatives Chilled Desserts

THESE THREE SECTORS ALONE ACCOUNT FOR NEARLY 80% OF

TESCO FREE FROM GROWTH

GLUTEN FREE


15


WARBURTONS CONTINUAL GROWTH NOW MAKES IT LARGER THAN

DIETARY SPECIALITIES

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

Va

lue

sa

les £

00

0s)

Tesco Freefrom Genius Sainsbury Freefrom

Warburtons Gluten Free Dietary Specialities Nairns

Graph only displays top 6 ranges

GLUTEN FREE


16


WARBURTONS FIRST LAUNCHED INTO THE GLUTEN FREE MARKET

IN JANUARY 2011 AND HAVE SINCE EXPANDED THEIR RANGE

2011

GLUTEN FREE

2012


17


18


WARBURTONS TARGET SUFFERERS WITH THEIR NEW ‘SPECIALIST’

LOOK

More specialised –

focusing on sufferers

GLUTEN FREE

19


Available in Tesco, Morrisons and

Asda stores from Spring 2013

GLUTEN FREE

THIS SPRING ANOTHER A-LIST FMCG PLAYER, HEINZ LAUNCHES

“shoppers were often reluctant

to try gluten-free products as

they tended to be made by

relatively unknown brands”

Corn,

Potato and

Lupin Flour

20


3949

6151

Last year This year

Bought both years

Only bought in 2013

Only bought in 2012


GLUTEN FREE

Who are the lost

shoppers?

• 98% non-

sufferers

• Sweet

Biscuits

• Pasta

• Chilled

• Rice cakes

49% OF ALL GLUTEN FREE BUYERS THIS YEAR ARE NEW TO THE

CATEGORY (5.6M HHs)

New

Lost

Repeat

22


Is a trend to buy Gluten Free

behind the influx of new

shoppers?


'Everyone should try no gluten for a

week. The change in your skin,

physical and mental health is amazing.

U won‟t go back!‟

„Gluten Free is the way to be‟

World No. 1 Novak Djokovic has played in

three Grand Slam finals since switching to

a gluten-free diet.

Possibly. Celebrities are encouraging

a gluten free diet


“Every single nutritionist, doctor and

health-conscious person I have ever come

across… seems to concur that (gluten) is

tough on the system and many of us are at

best intolerant”

However, it’s not all good publicity

25


10

10

8

6

New, Non sufferering shoppers (Spend %)

2.8

97.2

Wheat or Gluten Intolerant HHs

Non allergic HHs

Tesco Free From

Aldi

Look What We‟ve Found

Mr Mash


GLUTEN FREE

INDICATING A TREND, 97% OF NEW GF SHOPPERS ARE NOT

SUFFERERS

However, new shoppers buy a wide range of brands,

indicating an interest in the category overall

26


12

8

14

24

17

12

19

37

8

3

108

0

5

10

15

20

25

30

35

40

YO

Y %

Va

lue

Cha

nge

Total Free From Gluten &/or Wheat Free Other Free From


TOTAL FREE FROM

ALTHOUGH A TREND MAY HAVE ENCOURAGED SHOPPERS

RECENTLY, GF HAS POSTED SIGNIFICANT GROWTH FOR THE LAST

THREE YEARS AND HAS ALWAYS DRIVEN FREE FROM SALES

27


Room to grow:

˃Gluten Free Brands in the UK look to the US to predict trends in the UK

˃US Gluten free foods industry $4.2 billion 1% of US grocery

˃Gluten Free in the UK is still only 0.1%.

Greater exposure:

˃Large FMCG brands continue to launch: Tesco, Heinz & Warburtons

Increasing need:

˃Extra 5.6 Million more GB households buying Gluten Free this year

˃Coeliac Disease 4 X more common than 50 years ago

˃Houses can turn into a Gluten Free Zone

THE FUTURE OF GLUTEN FREE…


GLUTEN FREE


How big is the Gluten/ Wheat Free Market?

£180M

Is it growing and for how long?

+37% 10 x faster than grocery and not slowing yet

What drives growth?

Shoppers who are not just Gluten/ Wheat intolerant


Which sectors are best

to play in?

30


BREAD AND CHILLED GOODS ACCOUNT FOR 20% OF THE MARKET

AND BOTH SEE GROWTH OF OVER 10%

Bread

Chocolate

Confectione

ry

Main Meals

Pizzas

Cook + Pour

Over Sauces

Macaroons

Whole/Slab

Cakes

Seasonal

Sweet Pastry

Chilled

Flour

Cereal Bars -

Individual

USA Muffins

Crackers+Sav

oury Biscuits

Rolls/Baps/B

uns/Bagels

Sweet Biscuits

Cereal Bars - Multi

Pack

Morning Goods

Dry Pasta

Frozen

Cake

Slices/Cake

Bars

Liquid

Dairy Free

Altrntv

Cereal

Desserts

Meal

Solutions

Rice/Corn

Snacks

Speciality Bread

Decline more than

-5%

Decline between -5

and 0%

Growth between 0

and 5%

Growth between 5

and 10%

Growth more than

10%

GLUTEN FREE

Excludes Other and Liquid Dairy Free Alternatives


31


GLUTEN FREE AISLE IS PURELY AMBIENT OFFERING

• Dual siting

• Wide variety but

cluttered

• Promotional activity

Tesco store, Surrey, UK

GLUTEN FREE



Gluten Free Ambient Bakery

33



AMBIENT BAKERY CATEGORY DEFINITION

Cake Slices/Bars

Bread

Morning Goods

Speciality Bread

Whole/Slab Cake

Rolls/Baps/Buns/

Bagels

Rye Bread

USA Muffins

Macaroons

GF BAKERY

34



£46m

+18%

Total Free

From +24%

Total Gluten

Free +37%


Total

Ambient

Groceries

+4.2%

26Ambient Bakery

accounts for just

over a ¼

of all GF sales

35


Co

ntr

ibu

tio

n t

o Y

OY

%

All Others

Livwell

Dietary Specialities

Asda Free From

Tesco Freefrom

Ok Foods

M+S

Mrs Crimbles

Village Bakery

Biona

M+S Free From

Antoinette Savill

Lazy Day

Morrisons Free From

Wait Love Lfe Gluten Free

Sunstart

Sainsbury Freefrom

Yes You Can Gluten Free

Waitrose Lve Lf Free From

Genius

Warburtons Gluten Free

IN CONTRAST TO TOTAL MARKET - WARBURTONS DRIVE GROWTH. TESCO

FREEFROM HAS A NEGATIVE IMPACT TO GROWTH WHICH THEY WILL WANT

TO ADDRESS

Only splits out top 20 ranges

GF BAKERY

36


WITHIN GF AMBIENT BAKERY, BREAD IS LARGEST; SPECIALITY BREAD,

CAKE SLICES & MORNING GOODS ARE ALL KEY.

USA MUFFINS PROVE THAT A NEW CATEGORY CAN QUICKLY BECOME A

KEY PART OF GF

38 42

16 14

12 11

10 9

9 7

3 77 63 3

2012 2013

Rye Bread

Macaroons

Whole/Slab Cakes

USA Muffins

Rolls/Baps/Buns/Bagels

Morning Goods

Cake Slices/Cake Bars

Speciality Bread

Bread

GF BAKERY


37


ONLY MUFFINS PERFORM AHEAD OF THE GF MARKET.

BREAD POSTS STRONG GROWTH, SIGNIFICANT, GIVEN THAT IT IS

THE LARGEST SECTOR

-9

-8

2

4

9

15

16

18

29

37

180

Whole/Slab Cakes


Speciality Bread

Macaroons


Morning Goods

Rye Bread

AMBIENT BAKERY

Bread

TOTAL GLUTEN FREE MARKET

USA Muffins

GF BAKERY


YOY Growth

38


-2,000 -1,000 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000

AMBIENT BAKERY

Bread

USA Muffins

Morning Goods


Speciality Bread

Rye Bread

Macaroons

Whole/Slab Cakes


Penetration % Purchase Frequency Trip Packs Price per Pack

7m

4m

2m

0.5m

0.4m

0.1m

0.1m

-0.3m

-0.3m

Contribution

GF BAKERY

THE MAJORITY OF BAKERY CATEGORIES ATTRACT MORE

SHOPPERS THIS YEAR



Total Market Trends GF could

capitalise on

40


A GF ALTERNATIVE TO CRUMPETS, BAGELS AND BRIOCHE COULD

MEET DEMAND

Fastest growing ambient bakery and morning good sectors

Crumpets +12%

Bagels +7%

Brioche +25%

Crepes and Pancakes +7%

Sandwich Thins +100%

Pitta, Wraps and Naans +100%

£68M

£59M

£48M

£123M

£27M

£23M


*Sectors in

the total

market and

not GF

TOTAL UK GROCERY

41


Healthier Biscuits £188M +28%

HEALTHY BISCUITS WOULD APPEAL TO HEALTHY GLUTEN FREE

BUYERS.

TOTAL UK GROCERY

42


READY MEAL OFFERING IS LIMITED FOR GLUTEN FREE, YET IT IS A

FAST GROWING LARGE SECTOR IN THE TOTAL MARKET

Total Market Chilled Ready Meals £2.4Bn +8%

Total Market Chilled Pizza and Bases £430M +6%

EXISTING GLUTEN FREE ALTERNATIVES GROW,

DEMONSTRATING A NEED

Gluten Free Meal Solutions and Pizza

Growth +100%

TOTAL UK GROCERY

READY MEALS CAPITALISE ON THE GROWING CONVENIENCE

FOCUS

Online to launch in H2

2013. Launch of London

M Local stores supported

by new distribution

centre

Continued strong growth

in online and convenience

- target of opening 1 to 2

small stores per week

DRIVEN BY CONSUMER DEMAND

Yoy Growth %

TOTAL UK GROCERY

TRADE GAIN HIGHER PRICES & LOWER RELIANCE ON

PROMOTIONS THROUGH TARGETING THE ‘FOR TONIGHT’ MISSION

„FOR TONIGHT‟ MISSIONS PAY A

13%PRICE PREMIUM OVER „MAIN

SHOP‟

„FOR TONIGHT‟ MISSIONS BUY

25%LESS ON DEAL THAN „MAIN SHOP‟

This is especially the case within Chilled Ready

Meals

TOTAL UK GROCERY

9.3 10.9

37.2 32.5

57.8 539 12.1

25.6 27.1

34 38.5

7.4 919.8 16.9

Tesco excl Conv & Online

Sainsbury's excl Conv & Online

Tesco Express Sainsbury's Local

Specific Journey

Replenishment

Main Shop

For Tonight

‘FOR TONIGHT ‘ IS LARGEST WITHIN CONVENIENCE

CHANNELS; GLUTEN FREE NEED A PRESENCE TO AVOID

MISSED SALES

Total MFP, 52 w/e Feb 17th 2013

TOTAL UK GROCERY


Which sectors should we play in?

Chilled and Bread are the largest.

Morning Goods and Cake Bars are also important

to Bakery

Opportunity in Gluten Free Crumpets, Bagels,

Pizza, Healthier Biscuits and Ready Meals




A GLUTEN FREE(GF) PRODUCT CAN BE A GF SUCCESS WITHOUT BEING A

SPECIALIST PRODUCT WITHIN THE GF AISLE

TOP SELLING GF SKU’S

GLUTEN FREE

£4.5m

-5%

£4.4m

7%

£3.8m

179%

£3.6m

14%£3.2m

40%

£2.8m

3%

£2.4m

103%

£2.4m

New Smaller Size 535gm

£2.1m £2.1m

+++%


54


BRANDS DOMINATE THE MARKET AND HAVE DONE FOR THE PAST 5 YEARS

62

38

68

32

71

29

70

30

69

31

Branded

Private Label

GLUTEN FREE


2013

2012

2011

2010

2009

Brands are even more

prominent in GF

Bakery:

74%

55


OPPORTUNITY IN BOTH BRANDS AND PRIVATE LABEL WHERE BOTH SEE

STRONG GROWTH

29

16

18

33

-3

4

20

44

-10

0

10

20

30

40

50

YO

Y %

Va

lue

Ch

an

ge

Branded Private Label

GLUTEN FREE


In GF Bakery – brands drive growth

+25% as PL only grows at 3%

56


BRANDS STILL ATTRACT MORE SHOPPERS, WHILST PRIVATE LABEL

RELIES ON EXISTING FOR GROWTH

-5,000 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000

Branded

Private Label


£17m

£30m

GLUTEN FREE


+33%

+44%

This is a similar story in GF Bakery

– attracting 230,000 more shoppers

57


IN ALL BIG 4 RETAILERS, BRANDS ARE MOST IMPORTANT. TESCO RELY

MORE ON THEIR PRIVATE LABEL

0

17

90

96

75

71

77

65

69

100

83

11

4

25

29

23

35

31

M&S

Hard Discounters

Waitrose

Co-Operative

Morrisons

Sainsbury's

Asda

Tesco

TOTAL MARKET

Branded Private Label

GLUTEN FREE


58


GLUTEN FREE

5 TOP SELLING GLUTEN FREE BRANDS


59


WARBURTONS IS THE ONLY TOP BRAND TO OUT PERFORM THE MARKET.

GENIUS REMAINS THE #1BRAND. DIETARY SPECIALITIES GROWTH

SIGNIFICANTLY BEHIND THE MARKET

1. £12.3m

+22%

2. £10.6m

+103%3. £9.7m

+5%

4. £7.1m

+17%

5. £4.8m

+25%

GLUTEN FREE


60


WARBURTONS ARE STILL ATTRACTING NEW SHOPPERS DESPITE THEIR

RANGE LAUNCHING OVER 2 YEARS AGO

-2,000 -1,000 0 1,000 2,000 3,000 4,000 5,000 6,000


5.4m 5.9

2.2m 6.8

1m 3.9

1m 2.7

0.4m 5.4

Contribution Share

GLUTEN FREE


61


GLUTEN FREE

5 TOP SELLING GLUTEN FREE PRIVATE LABEL RANGES


62


1. £17.9m

+97% 4. £3.9m

-18%

3. £5.5m

+66%

2. £10.7m

+19%

5. £3.5m

+8%

GLUTEN FREE

ALDI OUT PERFORM THE MARKET, ALONG WITH TESCO’S FREE FROM.

ASDA’S FREE FROM RANGE IS THE ONLY PL TO SEE A DECLINE IN SALES


63


ASDA WILL BE LOOKING TO ALTER THEIR RANGE TO ATTRACT

SHOPPERS INTO THEIR GLUTEN FREE RANGE LIKE ALL OTHER

RETAILERS

-2,000 0 2,000 4,000 6,000 8,000 10,000


8.8m 9.9

2.2m 3.1

1.7m 5.9

0.3m 2.0

-0.8m 2.2

Contribution Share

GLUTEN FREE



64


HOW MANY GLUTEN FREE BAKERY SECTORS DO THE TOP BRANDS

OPERATE IN?

1. Bread

2. Morning Goods

3. Rolls/Baps/Buns/Bagels

4. Speciality Bread

5. Whole/Slab Cake

Bakery brands worth more than £500k

1. Bread

2. Morning Goods


4. USA Muffins

1. Bread


3. Speciality Bread

1. Cake Slice/Cake Bars

2. Macaroons

3. USA Muffins

1. Bread

2. Morning Goods


4. Speciality Bread

5. Whole/Slab Cake

1. Bread 1. Cake Slice/Cake Bars 1. Bread

2. Rye Bread

GF BAKERY

52 w/e up to 17th March 2013


65


6 RANGES GENERATE 78% OF GF BAKERY VERSUS +20 RANGES IN

TOTAL AMBIENT BAKERY. MOST BRANDS OUTSIDE OF GENIUS AND

WARBURTONS LOSE SHARE

GF BAKERY

24 23

119

6 5 53 3 2 2 1 1 1

Ge

niu

s

Wa

rbu

rton

s G

lute

n F

ree

Die

tary

Sp

ecia

lities

Sa

insb

ury

Fre

efro

m

M+

S

Mrs

Crim

ble

s

Te

sco

Fre

efro

m

Asd

a F

ree

Fro

m

Liv

we

ll (Liv

we

ll Ltd

)

Wa

itrose

Lve

Lf F

ree

Fro

m

Yes Y

ou C

an G

lute

n F

ree

Su

nsta

rt

Bio

na

Mo

rriso

ns F

F

Sh

are

Sp

en

d %

2012 2013

Top Selling GF

Bakery Ranges



67


COMPETITIVE TO LAUNCH IN KEY BAKERY SECTORS

GF BAKERY

90% Bread is made up of Genius and Warburtons

90% Speciality Bread is Dietary Speciality

90% Morning Goods is Warburtons and Livwell

60% of Cake Bars/Slices is Mrs Crimbles and Sunstart

68


Gluten Free Bakery 22%

Total Ambient Bakery 15%

Bread 8%

Morning Goods 18%

Cakes & Pastries 20%

ALTHOUGH KEY BRANDS DOMINATE, NPD GENERATES MORE SPEND IN GF

BAKERY THAN TOTAL BAKERY

2,453139,866

180,002

Excluding NPDs Including NPDs


Gluten Free Market Spend £000‟s

NPD Market Share

NPD

£40m

GF BAKERY


Which SKUs generate the most sales?

Not just specific GF brands

Does Own Label dominate the market?

No, Brands dominate and attract more shoppers

Who is the branded competition?

Genius & Warburtons generate 50% of the Bakery market &

gain share at the expense of other brands

Which brands underperform?

–Dietary Specialities, Livwell and Mrs Crimbles all lose share,

putting their shelf space at risk


Where are the retailer

opportunities?

71


ASDA USED TO OUT PERFORM THE MARKET, SINCE TESCO

EXPANDED FREEFROM RANGE THEY LOSE OUT TO TESCO, HARD

DISCOUNTERS AND M&S

-60

-40

-20

0

20

40

60

80

100

120

140

YO

Y %

Va

lue

Ch

an

ge

TOTAL MARKET Tesco Asda

Sainsbury's Morrisons Co-Operative

Waitrose Hard Discounters Marks & Spencer

CAUTION! Lower M&S Buyer Numbers

GLUTEN FREE


72


ALTHOUGH M&S ONLY GENERATE 5% OF GLUTEN FREE, THEY ARE

THE THIRD BIGGEST CONTRIBUTOR TO THE GROWTH OF THIS

MARKET

-5,000 0 5,000 10,000 15,000 20,000 25,000

Tesco

Sainsbury's

Marks & Spencer

Asda

Waitrose

Hard Discounters

Morrisons

Co-Operative


20.1m

8m

4.2m

3.5m

3.1m

2.7m

2.5m

-100k

Contribution £

GLUTEN FREE

73


TESCO GENERATES A THIRD OF SALES AND GROWS- CANNOT

IGNORE.

SAINSBURY’S WILL BE KEEN TO CLAW BACK LOST SHARE.

28 29 26 26 30

26 23 25 2221

10 10 11 15 13

9 11 12 12 11

7 7 8 9 86

6 6 6 612 3 4 510 7 4 3 4

5 5 5 4 3

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2009 2010 2011 2012 2013

Va

lue

Sh

are

of T

rad

e %

Tesco Sainsbury's Asda Waitrose Morrisons

All Others Marks & Spencer Hard Discounters Co-Operative

GLUTEN FREE


74


METHOD OF IDENTIFYING RETAILER OPPORTUNITIES

PRINCIPLE:

˃ A RETAILER‟S SHARE OF A CATEGORY SHOULD BE THE SAME AS THE

MARKET.

˃ EXAMPLE:

˃ ASDA HAS A 14.7% SHARE OF GROCERY AND A 12.7% SHARE IN GLUTEN

FREE. THEY SHOULD HAVE 14.7% SHARE IN GLUTEN FREE.

˃ CALCULATION FOR ASDA SIZE OF PRIZE: 14.7% OF GLUTEN FREE

MARKET £180M= £26.4M

˃ £26.4M MINUS WHAT THEY CURRENTLY MAKE- £22.8M

˃ ASDA STAND TO GAIN £3.6M IF THEY WERE TO GENERATE THEIR FAIR

SHARE OF GLUTEN FREE

75


3.7

5

10.6

2.9

7.8

12.7

20.5

30

2.5

3

4.3

5.6

11.1

14.7

15

27.2

Aldi

M&S

Waitrose

Co-Op

Morrisons

Asda

Sainsbury's

Tesco

Total Grocery

Gluten Free

OPPORTUNITY IN ASDA, MORRISONS AND CO-OP AS ALL HEAVILY

UNDER TRADE IN TOTAL GLUTEN FREE

£3.6m

£6m

£4.8m

GLUTEN FREE


76


OPPORTUNITY IN SAINSBURY’S, MORRISONS AND WAITROSE TO

GROW GLUTEN FREE FASTER. SAINSBURY’S AND WAITROSE

DEMOGRAPHICALLY SIMILAR TO GF SHOPPER- EASIER TO

CONVERT

-1

18

20

22

28

37

59

65

86

Co-Operative

Asda

Waitrose

Morrisons

Sainsbury's

TOTAL MARKET

Tesco

Hard Discounters

Marks & Spencer

£2.7m

£1.7m

£2.8m

£3.6m

£2.1m

GLUTEN FREE




78


0

6.4

12.4

5.9

9.5

12.2

18.5

32.2

2.5

3

4.3

5.6

11.1

14.7

15

27.2

Aldi

M&S

Waitrose

Co-Op

Morrisons

Asda

Sainsbury's

Tesco

Total Grocery

GF Ambient Bakery

ASDA AND MORRISONS COULD GAIN £1.8M IF FAIR SHARE OF GF

AMBIENT BAKERY IS ACHIEVED. OPPORTUNITY WITHIN ALDI WHO

CURRENTLY DO NOT OPERATE IN THIS AREA

£1.1m

£755K


GF BAKERY

79


IF SAINSBURY’S ASDA, M&S AND WAITROSE GREW IN LINE WITH

THE GF BAKERY MARKET THEY COULD GAIN AN ADDITIONAL £3.3M

-10

-1

8

11

18

18

19

55

Total Waitrose

Total Marks & Spencer

Total Asda

Total Sainsbury's

The Co-Operative

TOTAL MARKET

Total Morrisons

Total Tesco

£523K

£508K

£555K

£1.8M


GF BAKERY


Undertrade

GF Bakery

Market

Underperform in Gluten Free Bakery

Overtrade GF

Bakery Market

Outperform Gluten Free Bakery

SHORT TERM OPPORTUNITYLONG TERM OPPORTUNITY

GF BAKERY

82


30 3241

1822

18 19

60

3446

14

21 1916

31 1719 15

2212

24

13 128

12

4 22 23

20 11

7

11 12 126

13

2319

35 5 16

7

8 10 913

9

7 1412 10

712

5 6 4 109 5

45

6 8 612

5

Va

lue

Sh

are

of T

rad

e %

Tesco Sainsbury's Asda Waitrose Morrisons

All Others Marks & Spencer Hard Discounters Co-Operative

TESCO HEAVILY OVER TRADE IN BREADS AND MUFFINS BUT

UNDER TRADE IN ALL OTHER SECTORS. THE REST OF THE BIG 4

COULD EXPAND THEIR BREAD OFFERING

CAUTION! Low Buyer Numbers


GF BAKERY


Tesco under trades in Branded Gluten Free, Morning Goods, Cake

Bars & Slices and Rolls, Baps and Buns. Should Tesco achieve

their fair share, they stand to gain £1.5M (£540, £604k and £359k)

Tesco have seen phenomenal growth in Gluten Free and their Free

From range is now No. 1

Sufferers are an important group, spending £200k more on grocery

a year in Tesco than the average shopper

Bagels, Crumpets, Brioche perform well in the market, could the

retailer stock a GF version to help gain their fair share?

No.1 Retailer: 30% share

Drive the market: +60%

No. 1 OL Range



Sainsbury’s under trades in Free From Bread and also under

performs (-6% versus the markets 30% growth). Should they gain

their fair share this would be worth an additional £629K

Whilst Sainsbury’s over trade in Gluten Free and have a similar

average shopper, the retailer under performs. If Sainsbury’s grew in

line with the market they would gain an additional £2.7M

Sufferers are an important group in Sainsbury’s spending £100k a

year more than their average grocery shopper

Dietary Specialities Bread declines by 17% in the market, and

within Sainsbury’s, could the retailer replace some of their SKU’s

with a new GF Bakery product to help drive growth?


Underperform: +28%

Turnaround GF Bread (-6%)



Asda have the opportunity to gain their fair share in Bread (£809k)

and Macaroons (£100k), Whole Slab Cakes (£133k) if they

generated 12% of these sectors as they do Total GF Bakery

Asda under trades and under performs in Gluten Free Ambient

Bakery. The retailer could gain an additional £1.1M if it was to generate the same share as it does in total Gluten Free

Dietary Specialities Bread declines by 17% in the market, and

within Asda, could the retailer replace some of their SKU’s with a

new GF Bread product to help drive growth?


Under trade: 13% versus 15%

£3.6M Prize

Underperform: +18%



Waitrose declines in GF Ambient Bakery by 10% driven by Rolls,

Baps, Buns, Bagels, Speciality Bread and Cake Bars.

Waitrose Under performs within Gluten Free in contrast to their fast

growth in Total Grocery. If the retailer grew in line with the market

they would have made an additional £2.8M

The Gluten Free shopper is very closely demographically aligned to

a Waitrose shopper, increasing the chance that Waitrose could convert their shoppers to buy Gluten Free.

Waitrose also under trade in Specialty Bread and Cake Bars.

Should Waitrose gain their fair share of 12%, the retailer could gain

an additional £470K and £300k.

No.4 Retailer: 10.6% share

Over trade yet underperform:

+20% and -10% Bakery



Morrisons under trades in Total GF Ambient Bakery and

specifically Morning Goods. If the retailer gained their fair share in

Morning Goods (10%) this would be worth an additional £130k

Morrisons Under Trades and under performs in Gluten Free and

stands to gain an additional £6M if it generated the same 11%

grocery share in Gluten Free.

The retailer currently struggles in the Total grocery market, and would be keen to ensure that all growth areas are covered

33 brands are sold in Morning Goods in the Total GF Bakery

market, Morrisons stock only 4. Could Morrisons dedicate more

space to this area that is seeing growth of 15%?

No.5 Retailer: 7.8% share

Under trade 8 % versus 11%

£6M Prize

Underperform: +22%



Which retailers do I need to play in?

Tesco and Sainsbury‟s

Which retailers need help?

Asda and Morrisons under trade

Waitrose and Sainsbury‟s under perform


Which shoppers should

we go after?


WE IDENTIFIED THE GLUTEN FREE SHOPPERS THAT HAVE AN

ALLERGY/ INTOLERANCE AND COMPARED THEIR PURCHASING TO

NON SUFFERING GLUTEN FREE SHOPPERS

91

92


1M HH HAVE A GLUTEN ALERGY/ WHEAT INTOLERANCE, WHICH IS

ALMOST 4% OF GB HOUSEHOLDS

GLUTEN FREE PRODUCTS ARE ALSO WHEAT FREE, ALLOWING

WIDER TARGET AUDIENCE

47% 32% 21%Gluten

Allergic HHs

Wheat

Intolerant

HHs

MAT Feb 13 – 1yr continuous panel


93


˃ Majority 1-2 member households

˃ Majority don‟t have children in the household

˃ Over-index on ABC1

˃ More likely to be 35-54 year old

˃ Bias towards pre-families and older dependents

˃ Strong over-index on South

SUFFERERS ARE AFFLUENT AND MORE LIKELY TO BE SOUTHERN -

AN ATTRACTIVE GROUP TO APPEAL TO

Gluten and Wheat Allergic


GLUTEN FREE


Wheat or Gluten

Intolerant HHs

Total Gluten Free

7.7 50.8 41.50

10

20

30

40

50

60


41

Vol %

51

Spend %

8

Buyer %

31 76 73 GF Ambient Bakery

SUFFERERS GENERATE 51% OF GLUTEN FREE SPEND.

EQUAL SPLIT OF TARGETTING SUFFERERS AND NON SUFFERERS.

IMPORTANT FOR TRADE TO NOT LIMIT PRODUCTS TO GF AISLE

GLUTEN FREE



ALTHOUGH SUFFERERS ONLY ACCOUNT FOR 31% OF BUYERS

THEY GENERATE 76% OF SALES AS THEY ARE MUCH HEAVIER

SHOPPERS

GF BAKERY

GF Bread Frequency Spend VolumeSpend

per Trip

Volume

per trip

Price

per Kg

Sufferer 13.2 £41 15.94Kg £3.1 1.204Kg £2.57

Non Sufferer 3.5 £11.19 4.34Kg £3.17 1.23Kg £2.58

Shopper habits within Gluten Free Bread

Per Household

96


0 20 40 60 80

Greater than

Gluten &/or Wheat

Free

Gluten &/or

Wheat Free =

+37%

+71%Non allergic

buying GF

+34%

Wheat or

Gluten

Intolerant

HHs

Expenditure YoY (%)MAT data

Who contributes to Gluten Free growth?

NON-SUFFERERS DRIVE THE MAJORITY OF GROWTH-AN

IMPORTANT GROUP

Less than Gluten

&/or Wheat Free

GLUTEN FREE


97


Non allergic buying

GF

Wheat or Gluten

Intolerant HHs

Total Responders

I restrict how much sugary

food I eat

The nutrional labelling on

food & drink products has

an effect on what I buy

Recently I have become

more aware of whether the

foods I buy are good for me

I try to lead a healthy

lifestyle

My diet is very important to

me

% of Households

agreeing

0 20 40 60 80 100

Health of Britain – 1-yr continuous

HEALTH IS IMPORTANT TO NON SUFFERERS AND A LIKELY DRIVER TO

PURCHASING GLUTEN FREE. A HEALTHY PRODUCT WILL APPEAL TO THIS

IMPORTANT GROUP

GLUTEN FREE



1.6Non Gluten or Wheat

7.2Wheat or Gluten

Intolerant HHs

2.1Total Responders

Average number of GF sectors

bought per year

0 2 4 6 8


NON SUFFERERS BIGGEST OPPORTUNITY IS ENCOURAGING THE

PURCHASING OF MORE CATEGORIES. PRODUCTS SHOULDN’T BE

LIMITED TO GLUTEN FREE AISLE.

GLUTEN FREE


99


HARDER FOR GF TO COMPETE WITH MAIN STREAM PRODUCTS AS

CURRENTLY AT A PREMIUM

GF BAKERY

Grocery Av Price GF Av Price

Bread 86p £2.58 £1.72

Morning Goods 79p £2.04 £1.25

Speciality Bread 79p £1.85 £1.06

Rolls / Baps / Buns / Bagels 97p £1.83 86p

Whole / Slab Cakes £1.93 £2.66 73p

Cake Slices / Cake Bars £1.05 £1.72 67p

USA Muffins £1.08 £1.68 60p

Rye Bread £1.17 £1.46 29p


Price Diff

102


Non Gluten or

Wheat

Wheat or Gluten

Intolerant HHs

SPEND %

Meal Solutions

Cereal Bars

Rye Bread

Rice / Corn snacks

Macaroons

Sweet Biscuits

Cake Slices / Bars

Rolls / Baps / Buns / Bagels

Morning Goods

Total Ambient Bakery

Whole/ / Slab Cakes

Cereals

Bread

Speciality Bread

USA Muffins

Main Meal Pizza 89

87

81

80

79

77

76

73

68

65

63

44

43

38

36

17

0 20 40 60 80 100

GLUTEN FREE

SECTORS LESS RELIANT ON SUFFERERS HAVE MAIN STORE

SITING


105


42.336.8

13.318.5

20.7 19.8

11.1 11.2

2.1 3.34.8 4.3

0

10

20

30

40

50

60

70

80

90

100

ASDA MUCH MORE POPULAR WITH NON SUFFERERS THAN SUFFERERS

SO IT WOULD PAY OFF FOR ASDA TO TARGET THIS GROUP


GF BAKERY

Total Tesco

Total Asda

Total

Sainsbury's

Total Morrisons

The Co-

Operative

Total Waitrose

Total Hard

Discounters

Non Gluten or

Wheat allergic

Wheat or Gluten

Intolerant HHs

SPEND %

106


KEY TO ATTRACTING NON SUFFERERS WILL BE AVAILABILITY OF

GLUTEN FREE IN THE WHOLE STORE

ONLY 2% SHOPPERS VISIT MORE THAN HALF THE STORE

IMPORTANT FOR GLUTEN FREE TO NOT BE LIMITED TO THE FREE

FROM AISLE

GLUTEN FREE CHILLED READY MEALS, PIZZA, HEALTHY BISCUITS

WILL HELP BRANCH PRODUCTS OUTSIDE OF GF AISLE

107


Non Gluten or

Wheat allergic

Wheat or Gluten

Intolerant HHs

Total Hard

Discounters

Total Waitrose

The Co-Operative

Total Morrisons

Total Sainsbury's

Total Asda

Total Tesco

TOTAL MARKET

SPEND %

Chart Footnote

…

75.8

78.2

69.3

76.6

75.7

67.2

77.5

100

0 10 20 30 40 50 60 70 80 90 100

HOWEVER, IT IS IMPORTANT TO REMEMBER THAT ALMOST 80%

AMBIENT BAKERY SPEND IS GENERATED BY SUFFERERS

108


KEY TO ATTRACTING SUFFERERS WILL BE EXPANDING THE

SELECTION

REQUIREMENT FOR GLUTEN FREE ALTERNATIVES TO SECTORS IN

DEMAND SUCH AS MORNING GOODS

HEALTH IS IMPORTANT TO SUFFERERS SO A FOCUS ON LOWER

CALORIE PRODUCTS COULD HELP TO GROW FURTHER

REMEMBER TRUST AND QUALITY IS KEY TO THIS GROUP


Which shoppers should we target?

Both Sufferers and Non Sufferers through a „by

the way, we‟re gluten free‟ approach.


115

£180m +37%

How big is Gluten Free and how does it perform?


116

Bagels, Crumpets,

Speciality Bread,

Ready Meals & Healthy

Biscuits

Which sectors are best to play in?


117

Warburtons and Genius

dominate Bakery

Opportunities in both

brands and PL elsewhere



118

Short term – Tesco and JS

Long term – Morrisons

and Asda

Where are the retailer opportunities?


119

Target both sufferers and

non sufferers through

main store location

Which shoppers should we go after?


…and by the way, it’s Gluten Free

120


Appendix- slides to add

123


AN INFLUX OF SHOPPERS DRIVES OVER HALF OF GLUTEN FREE GROWTH

Measure52 w/e 19

Feb 12

52 w/e 17

Feb 13

Change

(Actual)

Change

(%)Spend (£000) 131,766 180,023 +48,257 +36.6%

Packs (000s) 83,223 108,890 +25,667 +30.8%

Penetration (%) 35.23 41.49 +6.26 +17.8%

Frequency 5.41 5.84 +0.43 +8.0%

Spend per Buyer (£) 14.27 16.43 +2.16 +15.1%

Volume per Buyer (Packs) 9.01 9.94 +0.92 +10.3%

Spend per Trip (£) 2.64 2.81 +0.17 +6.6%

Volume per Trip (Packs) 1.67 1.70 +0.04 +2.1%Price per Pack (£) 1.58 1.65 +0.07 +4.4%

* Penetration contribution

includes population growth of 0.8%

Value up 36.6% worth £48.3m

0 10,000 20,000 30,000 40,000 50,000 60,000

Spend (£000)

+£48.3m

£180m (+36.6%)

Price per Pack (£)

+£6,428k

£1.65 (+4.4%)

Penetration (%)

+£27.2m

41.5% (+17.8%)

Packs (000s)

+£41.8m

108.9m (+30.8%)

Volume per Buyer

+£14.7m

9.9 (+10.3%)

Frequency

+£11.6m

5.8 trips (+8%)

Volume per Trip (Packs)

+£3,079k

1.7 (+2.1%)

GLUTEN FREE

124


GLUTEN FREE BAKERY – BRANDS

GF BAKERY

Measure52 w/e 19

Feb 12

52 w/e 17

Feb 13

Change

(Actual)

Change

(%)Spend (£000) 27,451 34,276 +6,825 +24.9%

Packs (000s) 13,215 16,136 +2,921 +22.1%

Penetration (%) 5.20 6.02 +0.82 +15.7%

Frequency 7.25 7.51 +0.25 +3.5%

Spend per Buyer (£) 20.15 21.58 +1.43 +7.1%


Spend per Trip (£) 2.78 2.87 +0.10 +3.5%

Volume per Trip (Packs) 1.34 1.35 +0.02 +1.2%Price per Pack (£) 2.08 2.12 +0.05 +2.3%



Value up 24.9% worth £6,825k

0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000

Spend (£000)

+£6,825k

£34.3m (+24.9%)

Price per Pack (£)

+£655k

£2.12 (+2.3%)

Penetration (%)

+£4,811k

6% (+15.7%)

Packs (000s)

+£6,170k

16.1m (+22.1%)

Volume per Buyer

+£1359k

10.2 (+4.7%)

Frequency

+£1,015k

7.5 trips (+3.5%)


+£344k

1.4 (+1.2%)

125


GLUTEN FREE BAKERY – PRIVATE LABEL

GF BAKERY

Measure52 w/e 19

Feb 12

52 w/e 17

Feb 13

Change

(Actual)

Change

(%)Spend (£000) 11,952 12,292 +340 +2.8%

Packs (000s) 6,071 6,347 +276 +4.5%

Penetration (%) 3.31 3.40 +0.08 +2.5%

Frequency 5.55 5.38 -0.18 -3.2%

Spend per Buyer (£) 13.76 13.70 -0.06 -0.4%


Spend per Trip (£) 2.48 2.55 +0.07 +2.8%

Volume per Trip (Packs) 1.26 1.32 +0.06 +4.5%Price per Pack (£) 1.97 1.94 -0.03 -1.6%



Value up 2.8% worth £340k

-1,000 -500 0 500 1,000

Spend (£000)

+£340k

£12.3m (+2.8%)

Price per Pack (£)

-£198k

£1.94 (-1.6%)

Penetration (%)

+£386k

3.4% (+2.5%)

Packs (000s)

+£538k

6347k (+4.5%)

Volume per Buyer

+£152k

7.1 (+1.2%)

Frequency

-£382k

5.4 trips (-3.2%)


+£535k

1.3 (+4.5%)

126


OCADO CONTINUE TO GROW AT TOTAL GROCERY BUT GLUTEN

FREE SALES SEE A MASSIVE UPLIFT FROM LAST YEAR

1,845 2,005

3,092

52 w/e 20

Feb 11

52 w/e 20

Mar 11

52 w/e 17 Apr 11

52 w/e 15

May 11

52 w/e 12 Jun 11

52 w/e

10 Jul 11

52 w/e 07

Aug 11

52 w/e 04

Sep 11

52 w/e 02 Oct 11

52 w/e 30 Oct 11

52 w/e 27

Nov 11

52 w/e 25

Dec 11

52 w/e 22 Jan 12

52 w/e 19

Feb 12

52 w/e 18

Mar 12

52 w/e 15 Apr 12

52 w/e 13

May 12

52 w/e 10 Jun 12

52 w/e

08 Jul 12

52 w/e 05

Aug 12

52 w/e 02

Sep 12

52 w/e 30

Sep 12

52 w/e 28 Oct 12

52 w/e 25

Nov 12

52 w/e 23

Dec 12

52 w/e 20 Jan 13

52 w/e 17

Feb 13

508,238577,453

637,458

Gluten Free

Total Grocery

+54%

+9%

+10%+14%


GLUTEN FREE

127


Gluten Free Mixes

913

0

200

400

600

800

1000

1200

1400

1600TOTAL GF MIXES

Bread Mixes

Breadcrumbs

Cake Mixes

Packet Stuffing

Pancake Mix

Pastry Mixes


GLUTEN FREE

128


Gluten Free Flour

0

500

1000

1500

2000

2500

3000

3500

4000

TOTAL GF FLOUR

Bread Flour

Other Plain Flour

Self-Raising Flour


GLUTEN FREE

129


0

6.4

12.4

5.9

9.5

12.2

18.5

32.2

3

4.7

4.1

8.4

11.9

14.2

14.7

25.9

Aldi

M&S

Waitrose

Co-Op

Morrisons

Asda

Sainsbury's

Tesco

Total Ambient

GF Ambient Bakery

ASDA AND MORRISONS COULD GAIN £1.8M IF FAIR SHARE OF GF

AMBIENT BAKERY IS ACHIEVED

£1.1m

£1.2M

GF BAKERY


£1.1m

130


Gluten Free Bakery – Gains/Loss

-2,000 -1,000 0 1,000 2,000 3,000 4,000 5,000 6,000

Total Tesco

Total Asda

Total Sainsbury's

Total Morrisons

The Co-Operative

Total Iceland

Total Waitrose

Ocado Internet

Aldi

Lidl


All Others

Total Switching

Shoppers Held

Shoppers Won

Category Arrivals

Switching based on Spend (£000s) to year ending 17-Feb-13

131


Asda‟s Switching losses in GF Bakery

-200 -150 -100 -50 0 50 100

Total Morrisons

Total Waitrose

The Co-Operative


Total Iceland

Aldi

Lidl

Ocado Internet

All Others

Total Sainsbury's

Total Tesco

Net switching - Spend (£000s)

Switching Spend (£000s) to Total Asda - year ending 17 Feb 2013

132


Switching Flow SummaryTotal Tesco

Total Sainsbury's

Total Morrisons

Total Asda

The Co-Operative

All Others

Ocado Internet

Lidl

Aldi

Total Waitrose

Total Marks &

Spencer

Total Iceland

Documents

Confirming the opportunities for Irish Suppliers within the UK