IRI delivered its annual State of the Industry event this month to a record number of attendees eager to understand how to navigate the challenges facing the FMCG sector and identify and embrace opportunities to drive growth.
The event explored key themes: the impact of macro-economic conditions and their knock on effect, disruption and transformation of the FMCG environment and the inflationary pressures and challenges facing the sector and its impact on the Kiwi consumer.
Key areas of opportunity were identified: increasing demand for value, the growing appetite for products and messaging that reflect the diversity of consumers in NZ, the changing nature of households including the rise of one the person household, brands that focus on sustainability, the emergence of the wellness mindset; and the escalating adoption of online.
Craig Irwin, Managing Director for New Zealand with IRI, thanked and congratulated his team and industry professionals for their support and involvement in this year’s IRI annual State of the Industry event. Thousands of people subscribed to attend the virtual event which included IRI industry and insights experts and profile keynote speakers including Nick Tuffley, Chief Economist, ASB Bank.
Irwin said: “This year’s State of the Industry event was incredibly successful and attracted record attendee numbers. These numbers reflect the general sentiment across the sector and the need for information, insights and guidance. While the sector is extremely resilient and agile, there is an overwhelming sense of uncertainty and eagerness to seek greater clarity around what the next 12 months hold and how to navigate them.
“The FMCG sector plays a critical role in the economy. We really are at the forefront of the world’s engine room working to provide consumers with their essential household needs, while at the same time contributing significantly to the economy and generating jobs. Changes in macro and micro conditions are often felt across the FMCG sector first before any other sector.
“Our State of the Industry event covered the key theme of resilience and adaptation in times of change. We explored the impact of macro and micro conditions on the FMCG sector across New Zealand. We also outlined how the industry is performing and how consumers are behaving as inflationary pressures impact households.”
The IRI event also covered indepth insights outlining the range of opportunities available to the sector to drive growth through innovation, in particular: inclusion and diversity, continued focus on sustainability, the emergence of the wellness mindset, product offerings that meet the changing nature of households and their makeup, and the growing adoption of online shopping. In addition, it also identified the growth of the discounter business model and its impact on grocery categories.
Irwin said: “One of the key areas of opportunity for the sector in New Zealand involves delivering products to the market which are inclusive and reflective of the country’s diverse consumer base. Shoppers want to experience different products, but they also want to feel like their own culture and sensitivities are being considered as well. Several brands are already achieving significant progress in this area however there is still further scope to embrace the opportunities in this regard.
“Another of the key themes IRI talked to was that of consumer bifurcation. While a lot of households are struggling to make ends meet, there is still a portion of society out there spending money.
“We can also see how this is playing out in the supermarkets. While some consumers are trading down and buying more frozen vegetables and shelf stable fruit products, others are treating themselves to indulgent treats such as premium ice cream. IRI is also seeing the lipstick effect in full swing as people are buying more beauty lines such as lip gloss and facemasks to beat the inflation blues.”
Sustainability is top of mind
“Sustainability is still top of mind and an important area of focus for many consumers. Brands that incorporate sustainability into their product positioning enjoy strong price premiums. This is an area of huge opportunity for brands to close the cost gap making sustainability more accessible. Brands that embrace value as well as values in a simplistic yet curated way will be rewarded for their ingenuity.
“The wellness mindset continues to offer opportunities for growth as consumers strengthen their resolve to take charge of their own health and wellness journey and incorporate products into their life that support improved life balance and wellbeing.
“Online shopping has been growing at the fastest rate in our history. This combined with changes in household makeup and the rise of the one-person household presents interesting yet exciting challenges for brands to create offerings that meet the needs of the fast-evolving shopper base.
“Overall, while inflation is biting, consumers are still spending, however the increase in cost of living has impacted the lower income band of the market space the most. There are certainly some headwinds afoot, however as our State of the Industry event showcased, the future holds scope for innovation and growth for the FMCG sector, provided we utilise insights and draw on them to translate the macro and micro challenges and consumer sentiment and changing behaviours into opportunities,” said Irwin.
To enquire about the event, go to: https://www.iriworldwide.com/en-nz/company/contact-us
