A very important birthday has been omitted from our diaries this year. Not the Queen’s and certainly not Convenience Store’s. It has been 200 years since the first commercial canning plant was established by English engineer Bryan Donkin in South London.
That’s how much sales of canned grocery grew in the UK last year, according to Kantar
Two centuries on and the canned goods category is showing no signs of slowing down, despite the ease with which shoppers can now buy fresh produce.
According to Kantar Worldpanel data, sales of canned grocery grew by 4.6% in 2012, 1% higher than that of the total grocery market (3.6%). Category penetration is also high, with 99.2% of the UK population, or 26.2 million households, buying canned goods, above that of any other category, says Kantar.
What has helped sustain the popularity of canned grocery? Of course, during economic downturns consumers are much more likely to purchase goods that reduce wastage. And take into account the fact that the cost of fresh produce is also on the rise, and that more products are available in a canned format than ever before.
Canned Food UK spokeswoman Sue Shaw says that the diversifying range of canned goods has also helped the category’s success. “The industry is now very adept with ongoing developments in technology,” she says. “Moreover, the continual introduction of new and innovative products provides consumers with excellent value and a wide variety of choice. Twenty years ago, the main canned foods bought were sweetcorn, tuna and tomatoes. Now, suppliers make an impact with high-value products that have not always been available, from coconut milk, stir-fry vegetables and pulses, through to limited-edition flavours of store-cupboard favourites.”
Princes convenience channel marketing director Graham Breed says the category would thrive no matter what state the economy is in. “Ambient food is still essential to today’s consumer, and with almost all households buying canned food it will continue to be popular in the future,” he says. “The great value for money of canned grocery makes the category naturally resilient to economic changes and popular with cost-conscious consumers who are only buying what they require, adding to the growth of the market.”
He adds that the convenience of the canned category makes it ideal for all shopper demographics. However, he says the challenge for brands is to ensure that consumers recognise the benefits of ambient food by “pushing positive messages on-pack and promoting convenient meal solutions”.
“We’re a community store so we sell a lot of canned goods. There are staples such as beans and peas which will sell all year round, but then products such as tinned fruit are quite seasonal and will do better in the autumn and winter months.
“I’ve found that customers are moving back towards canned foods because they want their money to go further. There’s less danger of wasting food with cans than there is with fresh, so customers are stocking up with canned foods more, meaning we have to make sure that our range is up to scratch.
“Own label canned groceries are very important for us. We have a Premier store right beside us so we need to be able to offer the products they don’t, and usually that’s own label. We’ll push hard on these, and on any promotions we can get. Pricemarked cans also generally perform well.”
Heather Stothard, Spar Maltby, Rotherham, Yorkshire
Heinz marketing controller Martin Driver says that the recession has only buoyed a strong category. “The can remains a popular format with consumers as they are continuing to demand convenient and quick meal solutions that also meet their health and taste needs,” he says. “This means that they were popular before the recession hit and remain a popular product. The economic climate has meant that shoppers are more price-savvy than ever before, their disposable income is tight, and confidence is low. As a result, we’ve seen more consumers managing tight budgets effectively and buying canned goods to have in their cupboards.”
RH Amar product marketing manager James Amar believes the resilience of the canned market is down to other categories pricing themselves out of contention due to rising production costs. “The escalating cost of fresh produce has led to more shoppers buying canned alternatives, and the weather has also fuelled growth in canned vegetables in 2013,” he says.
He believes the prolonged, cold winter led to shoppers buying ‘cold weather’ ingredients for longer, and he expects the effects of the arctic conditions to last for some time to come. “The prolonged, cold winter, exacerbated by severe flooding in parts of Europe, has led to some crops needing to be replanted, resulting in later harvests, with reduced yields anticipated. While this dynamic will impact the supply and cost of both fresh and canned vegetables, the price rises to fresh will further drive shoppers to lower-priced canned options.”
Big on impact
Even though customers are looking for value, they don’t seem to be scrimping on price, and big-name brands are still top of the shopping list in canned.
Cirio UK brand manager Clive Davies says: “We have seen that own label canned goods are in decline, both in the independent and multiple sectors, with consumers’ tastes and product quality becoming more important.”
Tony Gill, commercial director at Del Monte Foods UK, believes that it is branded goods that customers are seeking out at convenience stores. “Own label canned goods’ total market share is being gently eroded as its growth trails that of the market,” he says. “Strong brands are the best way to signpost the category and focusing on NPD is a great way to build interest and loyalty, and continue to attract new shoppers.”
Gill says that tighter household budgets can lead to consumers spending more on canned goods. “Pressure on household budgets plays to the strengths of canned as consumers look to better manage their expenditure and reduce the waste often associated with shorter shelf-life products,” he says. “We have also found that when consumers have less to spend they increase their reliance on brands they trust, such as Del Monte.”
Breed agrees it’s down to customers trusting what they know. “Consumers visit their local independent retailer to top up on ingredients for their evening meals and for a quick mealtime solution. Shoppers look to brands they know and trust to deliver on quality, and a well-stocked ambient canned goods fixture is key to convenience stores generating strong sales.”
Even though the market is buoyant, it’s still important for retailers to ensure their canned section is up to scratch. Breed says store owners need to check they not only have the right products for their customers, but are promoting them in a proactive way.
“Availability is vital,” he says. “Gaps on shelves will turn customers away, potentially driving them to visit other stores. Retailers should also take advantage of the availability of pricemarked packs, as consumers are looking for good value for money. Joint promotions across complementary products are also useful to encourage incremental sales.”
Heinz’ Driver says the brand has put a focus on transparency in pricing through pricemarking packs. “One of the key strategies we put in place that has helped to drive sales is providing pricemarked packs for shoppers,” he points out. “The amount of shoppers purchasing pricemarked packs has grown considerably, and Heinz has seen a 50% increase in sales of these products during the recession. These macro trends of the past four or five years have resulted in a change in shopper behaviour, which in turn has positively impacted the growth of pricemarked packs.”
Driver adds that value and brand trust can co-exist, as proven by Heinz. “According to research, 88% of consumers say Heinz Tomato Soup is a ‘trusted brand’, up a strong five points versus last year,” he says. “In addition, 89% of consumers say that Heinz is everyone’s favourite baked beans, up one point versus last year. We believe that if we continue offering our customers high quality, satiety and great value by developing new innovation from customer feedback, we’re definitely on the right path to success.”
Davies advocates the meal deals option, but thinks that pricemarks aren’t necessarily the solution for canned. “They can deter independents from buying. Store owners should retail their products to suit their competition and geographical location,” he says. “Cirio currently does not use pricemark packs, to give retailers flexibility.
“However, canned goods should be in meal deals such as Cirio Pizzassimo sauce, pizza base, chopped ham and mozzarella for and authentic home-cooked fresh pizza. Retailers could also include a bottle of wine for a Friday night meal for two. The same could be done for spaghetti bolognese or pasta dishes,” he adds.
Gill says that retailers could make something special out of their canned food offering if they plan ahead. “Seasonal associations can be used to great effect, but these are often better achieved through themed off-shelf displays,” he says.
Even though not all stores have the space to carry a huge range, Amar says they don’t have to miss out on the popularity of canned, and that small might actually be an advantage. “The space limitations in smaller store formats can restrict the range of fresh vegetables, leading shoppers to buy canned alternatives, sometimes as a distress purchase.”
Ones to watch
Del Monte has unveiled a range of 230g pineapple chunks in syrups naturally flavoured with vanilla, coconut and mango. The brand has also introduced a range of 765g-825g Fruit Chef canned pie fillings in apple chunks and peach slices with cinnamon variants.
tel: 01784 447 400
In the pink
Princes has added two new Atlantic skinless and boneless salmon lines.
Atlantic salmon fillet in sweet chilli and lemon & dill variants is available in a ready-to-eat format (rrp £1.99), along with Atlantic salmon in lemon & black pepper and brine variants (rrp £3).
tel: 0151 966 7000
General Mills has launched a campaign to inspire consumers to create salads using cold canned Green Giant sweetcorn. The campaign will run on TV, and shoppers can redeem an exclusive Green Giant recipe booklet through the brand’s Facebook page via a code found on 2.5 million packs.
tel: 01895 201 367
Fun day out
Princes has unveiled a new on-pack promotion offering two-for-one deals on days out. Running across 2.5 million cans of four-packs of tuna, the ‘Perfect Days Out’ campaign offers deals on Virgin Experience activities, as well as the chance to win a £250 Virgin Experience voucher.
tel: 0151 966 7000
X marks the spot
Hunger Breaks has teamed up with Twentieth Century Fox for a promotion offering the chance to win a samurai experience in Tokyo.
The promotion features on Hunger Breaks Hot Pots and canned bean meals and coincides with the release of X-Men spin-off The Wolverine.
tel: 0151 966 7000