customer insight

customer insight

In s i g h t s t o d a y f o r t o m o r r ow’s d e c i s i o n s

S p r i n g 2 0 0 5

Winning Retail Strategies Start with High Value Consumers

Ethnic Marketing by the Numbers:

Integrating Diverse Data Can Reveal New Opportunities

Jack-in-the-Tiffin-Box: Unconventional Paths to

New Product Idea Development

Winning the Case for Better Distribution:

Optimizing Distribution for Mid- to Small-Sized Manufacturers

Canada’s Aging Boomers: A Golden Opportunity

ACNielsen Canada

160 McNabb Street Markham, Ontario L3R 4B8, Canada

http://www.acnielsen.ca

Understanding Consumers,

Completely.

In every issue…

Volume 7, No 1

Business Tools

Featuring:

ACNielsen Retail ACView

CBP—Category Business Planner

Spectra Distribution Builder

Homescan Shopper Trends

ACNielsen Target Track 2.0

TDLinx Location Information Management Homescan New Product Alert

Homescan Shopper Optimizer

Spectra Advantage Canada

LiquorTrack

Spectra Category ShareCast

Spectra Targeted New Customer List

Todd Hale, Senior Vice President

Consumer Insights, ACNielsen

Steve Kapinus, Director

Spectra Business Development

Design & Layout

Blue Lemon Design

Slack Barshinger & Partners

Copyright © 2005 ACNielsen Printed in USA All rights reserved ACNielsen, ACNielsen with globe design, ACNielsen Answers, ACNielsen Retail ACView, ACNielsen

LabelTrends, Answers Interactive, CBP, Consumer Direct, DecisionSMART, Homescan, RDH and Scantrack are trademarks or registered trademarks of ACNielsen (US), Inc Spectra, the Spectra logo, Spectra HispanIQ, Spectra InfiNet, Consumer 360 and the Consumer 360 logo are trademarks or registered trademarks of Spectra Marketing Systems, Inc TDLinx and the TDLinx logo are trademarks or registered trademarks of Trade Dimensions International, Inc Other brand, product or service names are trademarks

Winning Retail Strategies Start with High Value Consumers

High value consumers no longer declare allegiance to a single channel for life The battle for these sought-after shoppers is difficult Like any good battle plan, success relies on the quality of field intelligence and the ability to deploy assets for maximum impact The Food Marketing Institute (FMI), along with ACNielsen, conducted a landmark research study of U.S households and how they shop for food

10

Ethnic Marketing by the Numbers:

Integrating Diverse Data Can Reveal New Opportunities

The ethnic makeup of the U.S grows by about 2.5 million people each year Today, Hispanics and African-Americans comprise more than a quarter of the total U.S population With this demographic shift comes greater economic clout for minori- ties Manufacturers of consumer packaged goods must increasingly appeal to minority groups and reflect their cultural preferences to succeed

14

Jack-in-the-Tiffin-Box: Unconventional Paths to New Product Idea Development

To grow, many companies today focus on new product development Under the best

of circumstances, product innovation is a challenging activity The challenge grows when the targeted consumer is a child How, then, can companies gather informa- tion to guide product development efforts, especially as they relate to children? In a recent effort, ACNielsen ORG-MARG researchers addressed this issue using an innovative approach to gather credible, useful data

18

Winning the Case for Better Distribution:

Optimizing Distribution for Mid- to Small-Sized Manufacturers

Everyone knows the best packaging, best quality of food, and best advertising campaign gets you nowhere without distribution With competition fierce on retail shelves, small manufacturers need insights that can help prove why they should be there By gaining distribution in key retailers, the payoff can be huge.

22

Canada’s Aging Boomers: A Golden Opportunity

They aren’t babies anymore The brash, postwar generation that once lived by the anthem “I hope I die before I get old” is getting old, and is still the most influential consumer group in Canada These baby boomers will continue to set purchasing trends for at least the next 20 years, which represents a golden opportunity

22

Cultural Change It has become a popular business term When companies

talk about globalization, branding, organizing, resourcing or outsourcing, wehear about it Companies that are acquired (or divested) go through it Wehave also seen consumer demographic shifts, right here at home, that speak tocultural change And all of it impacts our business

At ACNielsen, we are also continuing our cultural change to meet the needs

of you, our clients Our recently completed Consumer 360 conference sented a key milestone in our journey, as we shared the ACNielsen and VNUvision for the future of our industry-leading services Just one year ago, weunveiled our Homescan MegaPanel, the industry’s largest consumer panel.Today, it has expanded to over 90,000 households and is ahead of schedulefor completion We also introduced LabelTrends to understand product health

repre-claims at the shelf Consumer Direct, DecisionSMART and Retail ACView are

other new and exciting services now available Spectra Marketing has alsolaunched Targeting Plus, Spectra HispanIQ, Spectra InfiNet, and CategoryShareCast, to name a few

The conference also served as a reminder to me just how much the industryhas changed and how we all have to continually work to stay ahead We willcontinue to be consumer-centric, comprehensive, technologically open andflexible Our strategy will be sharply focused on the industry’s most challeng-ing marketing and sales issues, including:

• Complete coverage of consumer behavior at all levels of the marketplace—

in the store, at home, on-the-go and online—along with measurement ofmedia consumption;

• Deeper knowledge of consumer attitudes and preferences, built on expandedconsumer panel research, customized research and other sources;

• A practical and action-oriented focus on the specific marketing and salesissues that have the greatest impact on growth, including marketing ROI, newproduct development, segmentation and targeting, assortment, pricing, promo-tion, supplier management, consumer management and in-store execution;

• New data harmonization and business intelligence capabilities to integrateinformation from a wide range of sources and organize it effectively andaccurately against specific marketing and sales issues;

A Drive for Innovation

• Web-based decision-support services

that place information and analytical

tools in the hands of the right people

at the right time in the right place;

• Advanced modeling & analytical

services that deliver effective and

easy-to-use tools for analyzing marketing initiatives and accurately

forecasting the impact of alternative approaches;

• Assertive, proactive client service that helps clients challenge assumptions

and develop creative solutions, based on a strong blend of broad consumer

marketing knowledge with deep expertise in specific business issues

At the conference, Steve Schmidt, ACNielsen’s president and CEO, put it best:

“Our job, pure and simple, is to help the industry grow.” This is easily said,

but in today’s complex marketplace—driven by diverse, ever-changing

con-sumers—it takes focus and commitment Our strategy is far reaching, but the

associates at ACNielsen are confident and energized

Our goal is to match your drive for innovation in marketing with an equally

intense drive for innovation in information services We will continue to

help you identify your best opportunities, focus your spending and reach the

right consumers, at the right time, in the right place, with the right messages

and incentives

To do that, we will:

Listen—to your needs, to your issues, to the things that are keeping

you up at night;

Learn—your business, your challenges, and how we can help solve them;

Leverage—the global power of One VNU to provide you the insights and

expertise unmatched in the industry, and;

Lead—the industry, by taking on the issues and initiatives that will continue

to supporting your business

Listen, Learn, Leverage, Lead This is our focus and commitment to you

and the industry

Todd Hale, Senior Vice President Consumer Insights, ACNielsen

nothing entertaining about the battle between

gro-cery and other formats for high value consumers

who no longer declare allegiance to a single channel for

life Like any good battle plan, success relies on the quality

of field intelligence and the ability to deploy assets for

maximum impact

Setting the Benchmark

One of the most powerful allies supporting the 46,000 U.S

retail food stores in their crusade for food basket

domi-nance is the Food Marketing Institute (FMI) In keeping

with its charter to conduct programs in research, education,

industry relations and public affairs, the FMI selected

ACNielsen to “conduct a landmark research study of U.S

households and how they shop for food This study is

expected to create a basic benchmarking tool regarding

con-sumer shopping behavior and attitudes.”

The result of that initiative is the FMI/ACNielsen study

Winning Strategies for Your Most Important Shoppers,

which will be summarized in the pages of Consumer

Insight magazine in a two-part article This, the first

installment, discusses research design, objectives and

topline findings Part two will contain a more granular

discussion of store universe trends, alternative channel

development, category trends and consumer-centric

retail opportunities

Research Objectives

The purpose of the study was to demonstrate how retailers

can leverage both behavioral and attitudinal consumer

insights to create competitive advantage and differentiate

offerings Research objectives include:

• Examine how shopping behavior differs across segments

• Determine the ways demographics and attitudes impact

where and how consumers shop

• Detail the competitive arena for retail shopper

segments, including the mix of channels shopped

• Identify the departments, categories and services

that appeal to the unique needs of different retail

shopper segments

Key Learnings

Seven areas of learning emerged from the research Somefindings were surprising Others reinforced historicaltrends Still others were encouraging signposts for predict-ing consumer behavior All provide a fact-based foundationthat retailers, wholesalers and manufacturers can use todevelop consumer-centric strategies to woo and win highvalue shoppers

1 Grocery Trip Erosion Continues Everybody wants a piece

of the top-spend consumer Grocery’s longstanding tripfrequency advantage was based on three factors: proximity,proliferation and product set Now that competitive formats have mounted aggressive expansion campaigns andawakened to the pulling power of fast-moving consumerpackaged goods, those traditional Grocery advantages have diminished

Look for an increasing number of trip diversions to Grocery channels as consumers combine multiple trips into asingle stop, picking up packaged goods at the dollar, homeimprovement or office supply store

non-2 Shopper Focus Is a Must It’s a case of lifestage strategies

trumping monolithic marketing The days of lumpingcustomers into one homogeneous segment are over

The age of lifestage marketing is upon us, and shoppingpreferences reflect the progression of family formationfrom young singles to maturing families to older singles

Household composition surfaced as a major driver ofchannel shopping and category buying dynamics Differentlifestage shoppers exhibited different shopping and buyinghabits, calling for a diversified set of marketing and pro-motion strategies Know thy customers’ wants and needs,and leverage frequent shopper programs to target top-spend shoppers and specialty sub-segments such as theelderly and ethnic groups

3 Cross-Channel Shopping Opportunities Two trends

headlined in the business press these days afford intriguing

opportunities for retailers: co-opetition and acquisition

Coined by Ray Noorda of Novell, and championed by

professors at the Harvard Business School and Yale School

of Management, the idea of co-opetition is simple:

collabo-rate with the competition to succeed It’s a spot-on

approach for Grocery stores, given their high degree of

interaction with other channels

In the case of Specialty Retailers like electronics, home

improvement or office supply stores, Grocers could pursue

store-within-a-store concepts to establish a satellite operation

without investing in a capital-intensive Greenfield operation

Another alternative would be to propose joint promotions

that benefit both parties like specialty retailer gift cards,

sam-pling stations and cross-shopping reward programs Either

way, strategic co-opetition can strengthen grocery sales while

diverting trips from poaching formats such as Mass

Merchandisers or Warehouse Clubs [See chart 1].

Retailers might borrow a page from the manufacturer

playbook (think P&G and Gillette) and consider mergers

and acquisitions as an alternative strategy for fending off

increasingly ravenous competitors Operating advantages

associated with volume buying clout, and an expanded

footprint boosting brand presence and convenience, are

just two of the potential benefits

4 Trip Capture Opportunity Grocery’s legacy strength in

food remains a powerful force for offsetting trip decay

Top-spend Supercenter customers (defined as the top

one-third of Supercenter shoppers based on their annual

dollar expenditures within this retail format) head for the

Hi/Lo Grocery frequently when looking to shop the dairy,

deli, fresh produce or meat departments

Assortment has been a pivotal tactical advantage forGrocery channel, but given the growth in value-priced/reduced assortment retailers (like Wal-Mart, ClubStores, Save-A-Lot and Aldi), one must question the con-ventional wisdom of this practice Increasing assortmentabove 320 items yields an incremental 25% sales gain forHi/Lo Grocery vs just 8% for Supercenters and 12% forEDLP formats The challenge: optimizing assortment formaximum pull and repeat business without carrying excessinventory One approach would be reducing center storeassortment while beefing up natural and organic offerings,expanding the entertainment and home goods sections

5 Attitudes Matter Want to categorize customers by

chan-nel segment? Use behavioral data But if you want to gize how to differentiate offerings, examine shopper atti-tudes For this section of the study, panelists answered a bat-tery of questions to ascertain attitudinal differences towardgrocery shopping The wide-ranging scope covered prefer-ences for everything from free-form to list shoppers, fromscratch to RTE meals, from the promotional indifferent to

strate-ad sensitives, from shopaholics to the shopping challenged Enough differences surfaced by format to suggest clear,attitude-driven competitive opportunities Some examples:Hi/Lo Grocery retailers will find their top-spend shoppershighly responsive to ads and frequent shopper programs—more so than other channels

It will come as no surprise to EDLP formats that their get-minded customer base uses price as the dominant selec-tion factor Specialty Grocery top-spend shoppers weighed

bud-in with high scores on questions about healthy foods,home cooking and scratch meals Supercenter top-spendshoppers opt for one-stop shopping at large properties

6 Food First—Perform on the Perimeter Talk about a

good news/bad news scenario While Grocery earns highsatisfaction scores on top-ranked selection attributes such

as convenience, weekly specials, fresh produce, fresh meatand wide selection, it remains highly vulnerable to incur-sion by price/value-oriented operators on the very impor-tant good value and low price criteria

As competitors push forward with aggressive expansioncampaigns, the current strongest point of difference forgrocery—convenience—will begin to dissipate Weekly ads

Chart 1: Alternative Channels Important to Grocery

Source: ACNielsen Homescan, Total U.S.—52 weeks ending 6/26/04

Supercenter Hi/Lo EDLP Specialty

Three primary data sources were used to acquire the necessary input for the study: ACNielsen Homescan Consumer Panel, ACNielsen Strategic Planner service and the ACNielsen Wal-Mart Channel service

Behavioral (purchase) information was garnered from the ACNielsen Homescan Consumer Panel, which provides longitudi- nal buying and shopping information for 91,500 U.S households ACNielsen Homescan information encompasses purchase date, shopper demographics, retailer/channel shopped, frequent shop- per card usage, payment method, coupon source, trip purchase amount, and for each UPC, the number of units purchased, price paid and deal type for each household shopping trip.

Attitudinal information was captured by fielding a 38 point tionnaire that investigated how ACNielsen Homescan panelists:

ques-• felt about the grocery shopping experience,

• defined and shopped the store universe,

• ranked store selection characteristics such as size, assortment and perimeter departments,

• responded to price and promotion strategies such as feature ads, frequent shopper cards or everyday low pricing (EDLP),

• viewed meal alternatives including home-cooked meals, to-eat prepared meals and away-from-home meals,

ready-• rated overall satisfaction with services provided by the store shopped most often for groceries.

Additionally, panelists were asked to select the three most tant attributes influencing the “where to shop for groceries” deci- sion from a list of seventeen pre-determined options ranging from fresh meet, to good service, low price and convenient loca- tion For the store shopped most often for groceries, panel mem- bers provided satisfaction levels with that store’s delivery against the same seventeen attributes.

and frequent shopper programs serve as a means to

distin-guish grocery formats, but at a cost prohibitive to most

EDLP retailers The lesson: focus on what grocery does

best—food—while providing a diverse assortment

appeal-ing to top-spend shoppers [See chart 2]

7 Differentiate, but Don’t Forget Price/Value Value

pric-ing is here to stay, with a vengeance The trick is findpric-ing

the balance between spending on differentiating programs

and services, without compromising the ability to price

competitively in key categories

Hi/Lo Grocery and Supercenters registered the highest

availability scores across the most services (prepared

food/meals, fresh flower department, banking/ATM,

in-store pharmacist, longer in-store hours, natural/organic food

section and in-store film development) Many services were

available at fewer than six in 10 outlets, leaving room for

geographic extension [See chart 3]

Demand was underwhelming for additional services whichincluded drive-through pharmacy, in-store sampling, on-sitecoffee shop, gas pumps and cooking lessons Adding theseservices to the format mix might attract a marginal number

of new customers, but prove to be an excellent way tocement relationships with loyal shoppers by retaining theirinterest and patronage with intriguing new offerings Thecost-benefit equation would evaluate improved customersatisfaction and competitive differentiation benefits againstincremental cost

Chart 2: Areas of Strength Aren’t Driving Satisfaction and

Satisfaction With Price/Value Is Very Low

% Responses from Attributes most Extreme

Top Grocery Important in Satisfaction with

Shoppers Grocery Store Selection Attributes

Threat as price/value formats become more convenient

Source: ACNielsen Homescan

Chart 3: Interest in Additional Services Varies by Format—

Most Do Not Appeal to Large Percentage of Shoppers

Red indicates: Differentiation and Shopper Satisfaction Opportunities

Source: ACNielsen Homescan

% Responses Top Hi/Lo Top EDLP Top Specialty Top

from: Grocery Grocery Grocery Supercenter

The ethnic makeup of the U.S has begun changing

markedly The total population grows by about2.5 million people each year, led recently by aconsistent, steady rise in the number of ethnic minorities

Today, Hispanics and African-Americans comprise more

than a quarter of the total U.S population, and their

numbers continue to grow If current trends continue, by

2050, close to half of the population in the U.S will be

non-white, and nearly a quarter of it will be Hispanic

With this demographic shift comes greater economic clout

for minorities In the U.S., the combined buying power of

Hispanics, African-Americans and Asians now exceeds one

trillion dollars—an all-time high—and is expected to keep

climbing Furthermore, many of these minority consumers

are young About one-third of all Hispanics and

African-Americans in the U.S are currently age 18 or under

For manufacturers of consumer packaged goods (CPG),these demographic trends add up to a timely marketingopportunity Companies must increasingly appeal tominority groups and reflect their cultural preferences tosucceed And the time to build such brand loyalty is now,

as this growing force of young consumers begins maturingand expanding its buying power

But how? The discipline of ethnic marketing, while lished in the U.S., is still relatively new As such, pursuing itpresents a number of challenges for CPG manufacturers.For example:

estab-• Data sources on ethnic buying habits tend to be mented and segregated, making it harder to compose awell-rounded picture of the minority consumer and astrategic plan to reach him/her

John Skolnicki Associate Client Director Client Service

• The information infrastructure for tracking ethnic

buy-ing habits is not as robust as the tools are for studybuy-ing

general market patterns To manufacturers, that means

not always being able to track the success of a

market-ing plan focused on minorities and not knowmarket-ing if

they’re implementing the right type of ethnic marketing

• We lack an abundance of business divisions dedicated

to multicultural business, which can make it too difficult

to gain support and funding for addressing ethnic

marketing needs

Integrated Data: A Source of New Insight

A case in point comes from a VNU client case study

Seeking to expand incremental sales of laundry care

prod-ucts to Hispanic consumers, the client wanted help in

understanding where and how best to do it For advice, it

turned to VNU, parent company of ACNielsen As an

industry leader in market research, VNU supports about

9,000 clients in the CPG sector as they address complex

sales and marketing issues

The traditional approach to ethnic marketing has been to

take fragmented approaches to target the ethnic consumer,

evaluate ethnic consumer opportunity, execute an ethnic

marketing program and track the return on investment of

implementing the program To date, it has been difficult to

find data integrated throughout this data process, and thus,

it has been a challenge to gain a fully nuanced picture of

ethnic consumer behavior

VNU’s insight into ethnic marketing has been to adopt a

“One VNU Approach” that integrates data from multiple

sources across our organization, including ACNielsen Target

Track, ACNielsen Scantrack, ACNielsen Store Level Data

and Spectra HispanIQ The result, for this client as well as

others, has been a deeper understanding of the ethnic

mar-ketplace and greater success in appealing to it

Successful ethnic marketing focuses on getting four things

right—namely:

• Picking the right geography, or studying an area where

the relationship of the market to the retailer creates

opportunity

• Picking the right category segments, or drilling down

to the appropriate category/brand level to identifyopportunities among items that are important toHispanic consumers

• Picking the right marketing mix, or putting together theright product with the right promotion to create a win-ning ethnic brand

• Picking the right execution strategy for the right place, orknowing how to reach the consumer you seek in thestore where he or she shops

Doing Laundry in L.A.

Nearly half (48%) of the Hispanic population in the U.S

today resides in just six cities—Los Angeles, New York,Miami, Houston, Chicago and San Antonio In each ofthese metropolitan areas, Hispanics comprise a significantpercentage of the total population base

In analyzing Hispanic consumption of laundry care ucts for our client, VNU decided to focus its study on LosAngeles The city is home to a large and very diverseHispanic population that represents more than 45% of thetotal market

prod-To find opportunities, we started by identifying retailerswith the greatest share of the Hispanic market for laundrycare products on the premise that category success for keyretailers would be vital to overall category success in themarket In Los Angeles, one retailer holds 40% of theHispanic laundry care product market VNU focused itsattention on understanding this retailer’s results

The next step was to identify the laundry care productspreferred by Hispanic consumers VNU wanted to know:

Which brands are underdeveloped and which offer the best opportunity?

Gathering information on consumption by minority group

is a growing strength of ACNielsen Using its ScantrackRetail Measurement Service, the company drills down intosales data by store and ethnic group, leveraging all

Scantrack stores in the market The resulting “snapshot”

lets ACNielsen compare Hispanic buying patterns againsttotal market performance

The data showed that Hispanic consumers prefer heavily

scented laundry care products in powder form

Superimposed on its data for retailers, VNU saw these

preferences held true by store as well as by total market

The second area of analysis was consumer targeting To

understand the Hispanic consumer in L.A., VNU used data

to map out a continuum of buying behavior across the

total market that it calls “acculturation segmentation.” At

one end of the continuum are Hispanic shoppers who

behave most like the market overall This group is

consid-ered “acculturated.” At the other end are those whose

preferences show a strong cultural influence They are the

least acculturated In the middle is the bicultural Hispanic

segment Accounting for 53% of all Hispanic adults in the

U.S., this group demonstrates a blend of buying patterns

The segmentation acts as an integration platform for

link-ing databases on product consumption from Simmons,

Scarborough, TDLinx and Spectra Store Trade Area

When VNU looked across the data, it saw that Brand A,

the market leader in laundry care products among

Hispanics, had been losing dollar share for the past year

and was an underdeveloped brand Furthermore, its sales

slide for Retailer A mirrored a trend for the total market

[See chart 1] A gap was emerging when VNU looked at

the market through all these lenses; namely, that Brand A

was missing an opportunity to capture Hispanic dollars in

this product segment of heavily scented laundry care

prod-ucts But how could the gap be closed?

Measuring the Marketing Mix

To answer that, VNU needed data in one more area:

Hispanic marketing execution Knowing which UPCsoffered the greatest opportunity for Hispanic sales, which stores to target, the demographics and psychographics

of the customers frequenting those stores and the best motional vehicles for reaching those customers could helpthe client decide where to focus their efforts

pro-Further analysis of the databases revealed that Brand A wasoverdeveloped in heavily scented UPCs It had more than itsfair share on Retailer A’s store shelves, but was capturingfewer sales than could be expected from the segment Itmade sense to focus on just the SKUs with a successful trackrecord to close the gap For the retailer, that share gap repre-sented $2.2 million in incremental sales that were possible

[See chart 2]

The last step in successful ethnic marketing is execution—knowing which stores to target, which customers toapproach and how best to reach them VNU’s analysis iden-tified the top 50 stores of Retailer A with declining brandsales It targeted an additional 50 stores with heavy Hispanic

Source: ACNielsen Target Track, 2004

Percent of Dollars, Heavy Scent and Heavy Scent by Form

Retailer A Retailer A

Hispanic

• Hispanic Total Category sales=$28.2MM –Each share point reflects $282K opportunity

• Existing share gap=8.1 share points

Category Dollar Share

31.8%

23.7%

Chart 2: Brand A Share Gap Represents $2.2MM

Opportunity for Retailer A

Source: ACNielsen Target Track, 2004

penetration [See chart 3] Focusing on these two areas will

help realize nearly $2 million of the $2.2 million in

poten-tial sales Further analysis revealed that Feature and

Display delivers the best promotional lift among Hispanic

consumers, and Brand A’s promotions are less effective

than the category average

Data from Spectra HispanIQ gave VNU a demographic

breakdown of the Hispanic residents in the area defined by

that store cluster—whether they spoke more Spanish or

English, where they fell on the acculturation continuum,

their education level, the size and age of their families and

their media preferences [See chart 4] From that analysis,

our client could begin to craft the messages and

promo-tions to reach those audiences Once the marketing plan is

implemented, the client can use Target Track to evaluate

return on investment of the funds dedicated to this effort

Business Tools for Retail Tracking Trendable ACV Market Share and Store Count Information

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The Retail ACView suite of reports is accessible via the secure

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Chart 4: What Does Retailer A’s

Hispanic Consumer Look Like?

Source: Spectra HispanIQ

Acculturated Cultural Acculturated

Psychographics Shop at stores Convenient Shop at

(Opinions that stock my location specialty

and Media) favorite brands important shops

Listen to radio Use Internet Use Internet

for news for shopping for shopping

updates information information

Read newspapers Often notes ads Magazines are a

on a regular basis at bus stops source of information

Enjoy watching Enjoy watching Pay attention to ads

kid TV shows kid TV shows in movie theaters

• Least Acculturated Hispanic consumers shop at stores

that they know carry their favorite brand.

• Radio and newspapers, not the Internet, are the best

way to reach Least Acculturated Hispanics.

• Both Least Acculturated and Bi-Cultural Hispanics enjoy

kids TV shows.

Continued on page 35.

Chart 3: Focus on Underperforming

Brand Stores Uncovers $694K Opportunity

Source: ACNielsen

Current Brand New Brand Brand $ Percent of

Share Share Increase (K) Category Dollars

*Tiffin box: In India, “tiffin” refers to a light meal eaten during the day

The boxes in which these meals are packed are called “tiffin boxes.”

product development It’s not an easy route; evenunder the best of circumstances, product innova-tion is a challenging activity that calls for creativity coupled

with a sound understanding of the consumer’s

socio-cultural needs

The challenge grows when the targeted consumer is a

child While often amazingly perceptive and articulate,

chil-dren can be limited in their ability to provide the kind of

socio-cultural data that market researchers seek They are,

for instance, disinclined to articulate their “need gaps” in

focus groups

How, then, can companies gather information to guide

product development efforts, especially as they relate to

children? In a recent effort, ACNielsen ORG-MARG

researchers addressed this issue using an innovative

approach to gather credible, useful data Although ourstudy focused on schoolchildren in Delhi, India, we believethe methods used and insights obtained cross cultural andgeographic borders

Background and Objective

Mothers in India—like mothers everywhere—try each day

to feed their children the nutritious foods their growingbodies need

One way Indian mothers do this is by packing traditionalIndian fare that they consider healthy and nourishing intothe “tiffin boxes,” or lunch tins, that children carry toschool During recess and on bus rides home, schoolchild-ren snack from these tiffin boxes—or at least their mothershope they do The fact is that children and mothers inIndia—like kids and moms everywhere—don’t alwaysagree on food And so the tiffin boxes often come homecontaining uneaten meals

Unconventional paths to new product idea development

Sangeeta Gupta Subhransu Rout Seemeen Khan ACNielsen ORG-MARG

Food manufacturers in the Asian Pacific region have

identi-fied tiffin box fare as an opportunity for new product

development The objective of our study was to create a

brief that would support idea creation by our client’s R&D

and marketing teams In this effort, our focus was not

defining final product ideas so much as understanding the

market and setting context for product development

The Approach

Our challenge in studying this opportunity was

multi-faceted We had multiple audiences to understand; that is,

children and their adults We had multiple agendas to

define—a child’s interest in food that’s fun and tasty as

well as a mother’s desire for that food to be wholesome

and nourishing Finally, to study children effectively, we

deemed it valuable to observe them “in the moment,”

in their own time and place

Using regular research methodologies to explore this

opportunity, therefore, would likely have been limiting So

ACNielsen ORG-MARG suggested a different approach,

called ethnography Ethnography emphasizes studying

issues “live” by making the researcher an upfront observer

at points of consumption Since our study was highly

focused and comprised episodic observations at multiple

sites, we called our study a microethnography

Our microethnographic approach had several steps First,

we wanted to understand the child So we began the

pro-ject by reading extensively from the works of noted child

psychologists about children ages 8–12 (our target market)

Next, we observed mothers preparing tiffin boxes by going

to their homes early in the morning Without telling them

that we were there to study tiffin preparation, we watched

these mothers in their early morning chores Then, when

the children went to school, so did we, sitting and chatting

with them during recess and on bus rides to learn about

their interactions with tiffin boxes As an additional step,

we spoke with school teachers to gather their insights

about the ways children use their tiffin boxes Finally, we

concluded the study by conducting synectic groups of

mothers and children that were charged with generating

ideas about tiffin boxes and tiffin box food, based on our

observations All fieldwork was conducted in Delhi during

January and February 2004

Our process emphasized certain concepts and practices:

• Seeking out reorienting and disconfirming observations.

To keep our observations fresh, we kept challenging ourassumptions about the study subject One assumptionwas that the tiffin box is important to the child andsomething that he or she looks forward to using Thishypothesis was soon disconfirmed

• Revisits of the sites under study We visited the identified

schools repeatedly to observe recess behavior on differentdays among the same set of students We also visited thesame set of students at different times of the day

to see their various interactions with their tiffin boxesand food

• Participative role relationships so that inquiry is

unfettered Our researchers were participative observers,

able to ask questions in a non-intrusive manner Forexample, when meeting with mothers, our researchershelped with the chores as a way to raise topics of interest

in an informal and natural way

• Wide range of perspectives and groupings We sought

multiple viewpoints on the topic, including mothers, dren, teachers, childhood experts and even fathers whowere around the house in the morning

• Collaborative “insider-outsider” effort We sought and

enjoyed a high degree of collaboration from both

children and teachers

• Collecting data in multiple modes We gathered

information in many ways, including artifacts,

photographs, spontaneous groups, etc

• Systematic data transformation To ensure the data

were examined from many perspectives, we used

indexing, coding, decontextualizing, memoing,

recontextualizing and more

Many of our research disciplines were based on research

by Gouldner, Barker and Kondo

The Insights

Children between ages eight and 12 are busy establishing

a sense of self-worth while learning about their world

They shift constantly between feeling competent and

feeling inferior, often based on responses from teachers

and peers Deeply curious, children this age love fantasy,

surprises, mysteries and freedom from restrictions

They possess a keen sense of humor

One world in which the child operates—and the context forthis study in consumer behavior—is school Indian schoolsare relatively demanding An eight-year-old’s day usuallystarts before 6 a.m., when he arises to catch the bus Mostchildren attend classes for several hours in the morningbefore enjoying a short recess of 25–30 minutes A couplemore hours of classes follow Then children ride the bushome to eat lunch It is during the brief recess and on thebus ride home that children engage with the contents oftheir tiffin boxes These moments of recess are times ofgreat release for the 8–12-year-old child—time that hewould rather spend in energetic play In this context, thetiffin is something to be done with as soon as possible.The other key player in this study is the mother She hasher own motivations and context as she packs the tiffin

box, the result of her upbringing and culture Many

moth-ers have firm beliefs about and practices in tiffin packing—among these, the belief that tiffin fare should mimic the

typical Indian meal, with its dal, roti, parantha, yogurt and sabji So she packs such foods, even as she knows that her

child probably wants something different and that theitems she’s packing may come home untouched

Continued on page 33.

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Winning the Case

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