1

Consumer behavior in take-home premium ice-cream

segment

Group 3: Aditya SharmaRobin Agarwal

Prasan Arora

A focus on Ben & Jerry’s and Häagen-Dazs in Singapore

2

Contents Industry Overview Research Objective Key findings from Literature Review Research Methodology Data Analysis Key Findings Managerial Recommendations Limitation Scope Key Learning

3 Industry Overview

4

Industry Overview

In 2011: ice cream segment grew 4% to reach S$118 million

Take Home segment commands a market share of 86% (volume sales).

While the CAGR (‘06-’11)for On Site segment was a mere 0.7%, the CAGR (‘06-’11) for Take Home was 2.3%

Shift in consumer preference to premium segment led to increase in average unit price of ice cream in 2011.

Therefore, premium brands performed well in 2011.

Source: Euro monitor report – Ice Cream in Singapore – December 2011

5

Industry Overview

Source: Euro monitor report – Ice Cream in Singapore – December 2011

2007 2008 2009 2010 20110.00%0.50%1.00%1.50%2.00%2.50%3.00%3.50%

YoY growth in the Take Home segment

2007 2008 2009 2010 20110.00%0.50%1.00%1.50%2.00%2.50%3.00%3.50%

YoY growth in the On-Site segment

6

Industry Overview

Brand Company 2007 2008 2009 2010

Wall's Unilever Singapore Pte Ltd 12.8 12.8 13 12.7

Magnolia F&N Foods (S) Pte Ltd 13.3 13.3 12.7 12.3

Häagen-Dazs

General Mills Asia Pte Ltd 10.1 10.1 10.3 10.5

Ben & Jerry's

Unilever Singapore Pte Ltd 5.4 5.4 5.6 5.7

Source: Euro monitor report – Ice Cream in Singapore – December 2011

Standard brands: Wall’s, MagnoliaPremium brands: Häagen-Dazs & Ben & Jerry’s

Brand Shares (% retail value rsp)

7 Research Objectives

8

Research Objectives

To identify factors that drive the consumption of premium ice cream brands in Singapore

To rate these factors in order of importance and effectiveness

To classify and compile the findings with respect to different segments in the target audience

To identify managerial implications and to make recommendations which may grow business for a premium ice cream brand

9 Key Findings from Literature Review

10

Key Findings from Literature Review

Price

Brand

Health Consciousness

Convenient Packaging

Taste/ Flavors

Purchase Decision

Independent Variables Dependent Variables

11 Research Methodology

12

Research Methodology

Research Methodology

Secondary Research

Literature Review

Analysis of - Market share, growth rates, categories in the industry

Primary Research

Qualitative

Industry Experts

Open Ended interviews

with customers

Quantitative

Survey questionnair

e

Statistical Analysis

13

Secondary Research

Research Reports

EBSCO host

Euro Monitor, Data Monitor

National Library of Singapore

Google Scholar

14

Research Methodology

Used SPSS software to analyze the responses to the survey

Factor Analysis

Cluster Analysis

Cross tab Analysis

Perceptual Mapping

15 Data Analysis

16

Sample Demographics

51%49%

Gender

MaleFemale

8%

21%

49%

16%

6%

Age (in years)

below 1818-2526-3536-45Above 45

48%

29%

23%

Citizenship

ExpatSingaporean CitizenSingaporean PR

56%32%

2%

10%

Residence Type

HDBCondominiumBunglowOther

26%

62%

5%7%

0%

Occupation

StudentEmployedSelf-employedHome makerOther

9%

20%

16%

12%

28%

15%

Monthly Household Income

Below S$2500S$2500 - S$5000S$5000 - S$10000Above S$10000I don't want to discloseNot Applicable

56%32%

2% 10%

Residence Type

HDBCondominiumBunglowOther

17

Factor Analysis

Rotated Component Matrix(a)

Component

1 2 3 4Brand 0.728 Willingness to pay 0.712 Price -0.604 Taste 0.837 Quality 0.776 Substitutes 0.716 Low calorie 0.676 Special occasions 0.638 Sales promotion 0.746Packaging 0.723

Brand LoyaltySensory

PerceptionHealth

consciousnessValue for Money

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• Buy same brand of ice cream• Don’t mind spending more for

preferred brand• Price is important

Brand Loyalty

• Taste is important• Quality is important

Sensory Perception

• Buy substitutes• Consciously look for low-calorie ice

cream• Buy premium ice cream for special

occasion

Health Consciousn

ess• Buy more ice cream on promotions• Prefer to buy multipack over single

pack

Value for me

Factor Analysis

19 Cluster Analysis

20

Generated Clusters

K-means clustering used A total of 3 clusters generated on the

basis of the following factors: Brand Loyalty Sensory Perception Health – Consciousness Value for Money

21

Brand Loyalty

Sensory Perception

Health Consciousness

Value for Money

Brand Loyalty 0.30

Sensory Perception -1.29

Health Consciousness 0.12

Value for Money 0.11

Cluster 1

Final Cluster Center

22

Important characteristics

Medium Brand loyalty score relative to others Least on Quality & Taste compared to other

clusters Open to substitutes like yoghurts and low-calorie

ice creams Average attraction to Promotions and packaging

relative to others 56% of the respondents in this market are

females Majority (67%) of the respondents are employed Most of the respondents (27%) fall into the low

monthly income group of S$2500- S$5000

23

Cluster 2

Brand Loyalty

Sensory Perception

Health Consciousness

Value for Money

Brand Loyalty 0.76

Sensory Perception 0.53

Health Consciousness -0.15

Value for Money -0.32

Final Cluster Center

24

Important characteristics

Extremely brand loyalHigh Willingness to buyPrice not an important factor while buyingHigh quality and taste demandedDon’t look for substitutes and are not health

consciousUnaffected by promotion sales and offersPackaging is also not an important criteriaMale dominated segment (54%)Consist of 66% employed whole mainly live in

HDB (57%)

25

Cluster 3

Brand Loyalty

Sensory Perception

Health Consciousness

Value for Money

Brand Loyalty -0.89

Sensory Perception 0.28

Health Consciousness 0.06

Value for Money 0.23

Final Cluster Center

26

Important characteristics

Not at all brand conscious Not willing to buy if expensive Taste and quality are a mild purchase drivers Less influenced by the presence of substitutes

and low calorie products in the market Highly influenced by the promotional offers and

deals on ice cream products Consider convenient packaging an important

criteria Female dominated (36%) 47% are expats and 57% live in HDB

27

Identified Segments

  Cluster 1 Cluster 2 Cluster 3

Brand Loyalty

0.30 0.76 -0.89

Sensory Perception

-1.29 0.53 0.28

Health Consciousnes

s0.12 -0.15 0.06

Value for

Money0.11 -0.32 0.23

  Cluster 1 Cluster 2 Cluster 3

Brand Loyalty

Medium High Low

Sensory Perception

Low High Medium

Health Consciousnes

sHigh Low Medium

Value for

MoneyMedium Low High

  Cluster 1 Cluster 2EconomicalSegment  Cluster 1

Superior Segment 

BalancedSegment

28 Perceptual Mapping

29

Balanced Segment

1 - Brand2 - Price3 - Quality4 - Taste

SegmentBrands

30

Superior Segment

1 - Brand2 - Price3 - Quality4 - Taste

SegmentBrands

31

Economical Segment

SegmentBrands

1 - Brand2 - Price3 - Quality4 - Taste

32Managerial

Recommendations

33

Balanced Segment

Ben & Jerry’s is lagging behind in C1 segment

Quality and taste is not so important factor

56% females Maximum no. if

homemakers 50% are married 52% - influence

for family 61% - buy for

family

Diversify to health related products – low calories and low fat

Introduce Greek Frozen yogurt in Singapore

Long term - as a family pack

34

Superior Segment

Taste & quality of prime importance

Price is not important

High-earning group (21% highest in all 3 segments)

Free sampling of existing flavors in supermarkets

Value proposition - launching a super premium product

Set at high price  Willingness to pay for preferred brand

Price sensitivity rating

Balanced 3.79 3.11

Superior 4.29 2.77

Economy 3.36 4.17

35

Economy Segment

37% students 33%

Singaporean citizens

Maximum social media users

Max traditional media audience

Bundling of plain flavors to promote multipack

Cross promotion with supermarkets during festivals and promotions

  Occasional Purchase Buy more on Promotion

Balanced 3.27 3.27

Superior 3.43 3.43

Economy 3.62 3.75

36 Limitations

37

Limitations

Sample data may not be representative of ice cream consumer population of Singapore in terms of ethnicity, residence status, geographies and other demographic parameters

The research does not focus on the strategic influence on the take home consumers by the onsite consumption

Although majority of the take home segment comprises of supermarkets , the research did not give much weightage to other retail avenues in the take home segment

The research did not include in-house brands of major retailers such as Fair Price and Carrefour

38 Scope

39

Future Scope This research can be used as a reference for

emerging brands in the premium ice cream segment

Insights from this research can help formulate the market entry strategy for a new player in the premium segment

More extensive data collection can improve the quality of the present study

In light of the slow growth rate forecast for the segment , this research can be used as a starting point to forecast future trends

40 Key Learnings

41

Key Learnings Survey questionnaire should be well structured Wide range of demographics of respondents

must be ensured Research objectives, framework and

methodology should be in sync A good literature review forms the basis of a

good research At every stage of gathering primary data, the

consistency and the acceptability of the data must be checked

42

Thank You!

43

Qualitative Research

Most preferred brands – Häagen-Dazs & Ben & Jerry’s

Buying frequency – once a month

Most bought quantity – 473 ml

No specific occasional purchase

Most preferred flavors – Chocolate and Vanilla

Factors considered while buying – Brand, Taste, Quality and Price

31%

27%

12%

12%

19%

Haagen DazsBen & Jerry'sMagnoliaDreyersOthers

Division based on preference

44

Qualitative Research

Most popular brands – Häagen-Dazs & Ben & Jerry’s

80% of consumers buy single pack

Most convenient place to buy – Supermarkets

Low-fat ice cream not popular

Favorite substitute (35%) – Yoghurts

Reason for buying ice cream – love for it, weather conditions, taste

14%

29%

26%

17%

7%

7%

MagnoliaHaagen DazsBen & Jerry'sWallsNestleOthers

Division based on popularity

45

Demographics

26%

62%

5%7%

0%

Occupation

StudentEmployedSelf-employedHome makerOther

9%

20%

16%

12%

28%

15%

Monthly Household Income

Below S$2500S$2500 - S$5000S$5000 - S$10000Above S$10000I don't want to discloseNot Applicable

56%32%

2% 10%

Residence Type

HDBCondominiumBunglowOther