IRI Report: Americans Seeking More from Today’s Convenience Products

Along with Speed and Ease, Consumers Now Demanding Nutrition, Customization, Portability and Quality

CHICAGO, Nov. 3, 2005 — With America’s fast-paced culture, convenience has reigned supreme as a primary benefit guiding U.S. consumers’ purchasing decisions. However, a study released today by Information Resources, Inc. (IRI), the leading provider of enterprise market information solutions for the consumer packaged goods (CPG), retail and healthcare industries, shows that while the market for convenience products remain strong, consumers are now demanding a more robust convenience-based product.

The report, entitled “Times & Trends: Beyond Time Savings: The New Face of Convenience,” examines an evolving landscape of convenience solutions that is responding to shifting demographics, growing consumer expectations and rising health concerns.

“Yesterday’s consumer was content with purchasing a product that promised to be quick and easy,” said Janet Eden-Harris, executive vice president and global chief marketing officer, IRI. “Now, consumers expect those same offerings to also provide significant nutritional benefits, as well as greater portability, quality and value. This report provides a unique look into the challenges and opportunities CPG manufacturers and retailers face in satisfying these needs.”

Convenient Meal Solutions
As more Americans are allotting less time for dinner preparation, the demand for convenient meal solutions remains great. The study reveals, though, that demand has evolved beyond simple time-savings alternatives, with consumers now requiring greater health and wellness benefits, taste and value.

In that quest for healthy offerings, consumers are increasingly reaching for refrigerated meals and meal components, reportedly perceiving these items to use fresher ingredients and contain fewer additives than their frozen and shelf-stable counterparts. According to the IRI study, this growth in the refrigerated sector bodes well for the supermarket channel, which holds an overwhelming share of this market, but also continues to battle Wal-Mart to maintain that share. The report encourages traditional grocers to protect and grow their footprint in the high-growth refrigerated meal solutions segment through targeted marketing and merchandising initiatives.

Additionally, frozen convenient meal solutions, namely multi-serve frozen meals, benefited from increased innovation, effective targeted marketing and greater appeal to value-conscious consumers to exhibit solid growth. The Baby Boomer segment is the primary target market for several successful new products within this category. As more consumers in this demographic become empty nesters, they become far less likely to purchase those convenient meal solutions specifically targeted toward hectic families. These multi-serve frozen meals apparently bridge the gap within this critical segment.

Convenient Snacks and Beverages
Portability and portion control appear to be the primary benefits driving strong growth in the convenient snack segment. With indulgent snacks, sales of single-serve and/or multi-packs of single-serve products, such as Nabisco’s 100-Calorie Packs, have risen steadily in the combined supermarket, drugstore and mass merchandiser retailer (excluding Wal-Mart) outlet.

Focusing on health-based snacks, several key categories continue to push strong growth in this sector with their ability to satisfy consumers’ snacking and meal-replacement needs in portable packaging. Because of its unique packaging and product innovation, sales of yogurt, in both single-serve cup and drink formats, continue to lead the way within the healthy snack and meal replacement sector. Additionally, granola bars and rice snack squares continue to post strong gains, while soups have more aggressively staked their claim with the onset of such portable products as Campbell’s Soup-At-Hand.

The report also outlines potential growth opportunities for manufacturers and retailers with regard to on-the-go beverages, which have experienced strong sales growth across major categories within food, drug and mass merchandise channels (excluding Wal-Mart). Retailers should strive to ensure that consumers have easy access to such beverages at multiple locations throughout the store, while manufacturers should continue to increase points of access for single-serve beverages.

Convenient Non-Edibles
According to the report, personal care products appear to be the next big convenience growth area. While the number of personal care products delivering significant time savings or enabling portable personal care has been relatively low when compared to other product areas, an opportunity has recently arisen with more consumers engaging in on-the-go grooming and utilizing personal care products at the workplace. The report recommends that manufacturers take note of this heightened interest in convenient personal care solutions and explore both the prospects of new product offerings and new portable-focused positioning opportunities for existing products.

The study also notes that while a handful of blockbuster new home care products with convenience benefits have transformed consumers’ cleaning routines, this market remains primed for additional solutions. Consumers remain interested in products that not only offer time-saving capabilities, but also those streamlined, “do-it-all” solutions that serve multiple needs in one package.

The complete report can be found in the Thought Leadership section of the IRI website (www.infores.com).

About the Report
Findings presented in “Times & Trends: Beyond Time Savings: The New Face of Convenience,” are based upon an extensive analysis of consumer data from the IRI Consumer Network® Household Panel, the IRI MarketInsight™ solution for Wal-Mart and scanner-based sales tracking data across food, drug and mass channels (excluding Wal-Mart) from IRI Infoscan® Reviews.

About Information Resources, Inc.
Information Resources, Inc. (IRI) is the world’s leading provider of enterprise market information solutions and services, empowering its clients to grow their business profitably in a complex marketplace. Driving the transformation of the consumer packaged goods (CPG), retail, and healthcare industries, only IRI provides a unique combination of real-time market content, advanced analytics, enterprise performance management software, and professional services. The company’s portfolio of services, solutions, and technology enable leading retailers and their suppliers around the globe to see what they are missing, act faster with greater confidence and win at the shelf. Ninety-five percent of the FORTUNE Global 500 in CPG and retail leverage IRI to power their business. For more information, visit www.infores.com.

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Information Resources, Inc.

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