Canadian Grocer - December/January 2019

Inside T&T’s new flagship store

What lies ahead?

Getting to Trends to watch in 2019 know Gen Z

PM 42940023

DECEMBER 2018 | JANUARY 2019

ON THE RISE

MEET OUR 2018 GENERATION NEXT WINNERS

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CONTENTS December 2018 | January 2019

COVER STORY

GENERATION NEXT WINNERS

37

Meet nine rising stars in the grocery industry

OPINIONS

07 Front Desk 17 Food Bytes 18 Behind the Trends 60 Checking Out PEOPLE

08 The Buzz

Comings and goings, store openings, awards, events, etc.

10 Ted Fleming

Partake Brewing’s founder brings craft quality to the alcohol-free beer market

FEATURES

WHERE SEAFOOD IS THE STAR

IDEAS

new flagship store in Richmond, B.C.

Canada’s Food Price Report projects food prices will inch up in 2019

13 Getting familiar with Gen Z Eight things you should know about this up-and-coming group of shoppers

32 Step inside T&T’s

COVER IMAGE: MIKE FORD

Volume 132 Number 8

15 Rising up

16 Seen & heard

WHAT’S IN STORE?

Find out what the industry’s big names have been saying at recent conferences

AISLES

47 A look at the trends

that could shape the business of selling groceries in 2019 and beyond

54 Good morning, sunshine

Healthy, flavourful and convenient breakfast foods serve up opportunities for grocers

10

56 Plant perfect

Today’s plant-based foods are pleasing vegans and meateaters alike

58

57 What’s in the freezer?

Nielsen data reveals how various frozen categories have been performing

58 Bottom’s up!

Alcohol-free beer, wine and spirits are booming, and not just for “dry January”

FRESH

59 Hot potato

New varieties and strategic marketing are helping the humble potato reassert itself

32

FOLLOW US ON @CanadianGrocer Canadian Grocer Magazine @CanadianGrocerMagazine December 2018 / January 2019 Canadian Grocer

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The CEO panel at Canadian Grocer’s annual Thought Leadership Conference

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IT’S ALL ABOUT THE CUSTOMER

Success comes from customer-centred solutions AT CANADIAN GROCER’S Thought Leadership conference in November, there was a lot of talk about doing right by your customers.

“You have to have solutions for your customers. And you can’t keep putting up the same box and expect consumers to follow you; you have to follow where the world is going,” said Empire Co.’s Michael Medline, who was part of the event’s CEO panel discussion. Medline was speaking about Sobeys’ strategy to appeal to customers in urban areas with stores that are different than the suburban models and that cater to the urban customers’ specific needs.

Also during the session, Walmart Canada chief Lee Tappenden spoke of how his company is investing in both bricks and clicks to provide a seamless experience for its time-starved customers. On the CPG side, Hain Celestial’s Beena Goldenberg stressed how crucial it is to have diversity in your teams to reflect the diversity of the customers you are trying to serve.

At a time when the world is changing rapidly and throwing up so many distractions, the wisdom of these panellists is

worth remembering. In sum: figure out what you stand for, stay true to your values and put the customer at the centre of everything you do and success should follow.

While we’re on the subject of success, in this issue we’re delighted to introduce our nine Generation Next winners for 2018.

Starting on page 37, read about these outstanding individuals who are making their mark on the industry, from the store manager championing inclusion and gender equality—while also increasing his store’s sales—to the private-label specialist who is racking up awards for the products she’s helping launch. In January we’ll be opening up nominations for our 2019 Generation Next Awards, so if you know a rising star in our industry, tell us about them at canadiangrocer.com/generation-next.

See you in the New Year!

Shellee Fitzgerald

Editor-in-Chief

sfitzgerald@ensembleiq.com

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December 2018 / January 2019 Canadian Grocer

7

THE BUZZ

The latest news in the grocery biz

It was a full house at Canadian Grocer’s Thought Leadership CEO Conference on Nov. 19

(Right) Canadian Grocer’s 2018 Generation Next Winners

Mary Dalimonte, Tom Gunter

AWARDS

Blind Bay Village Grocer, Blind Bay, B.C. Longo’s York Mills, Toronto

8

December 2018 / January 2019

At a gala event in Toronto in October, the Canadian Federation of Independent Grocers named the winners of its TOP INDEPENDENT GROCER OF THE YEAR AWARDS. The award recognizes some of the most outstanding grocers in the country. The 2018 Gold winners were: Save-On-Foods Northgate, Winnipeg (large surface); Longo’s York Mills, Toronto (medium surface) and Blind Bay Village Grocer, Blind Bay, B.C. (small surface).

JOHN GOLDSTEIN PHOTOGRAPHY, CFIG

Save-On-Foods Northgate, Winnipeg

The industry celebrated a few of its stars at the 2018 Golden Pencil Awards on Nov. 19. Mary Dalimonte, formerly of Sobeys, and Tom Gunter, formerly of Fiera Foods and Conagra, were honoured by the Food Industry Association of Canada for their out­ standing contributions to the industry.

During the evening, Canadian Grocer’s 2018 Generation Next Award winners were also recognized. Turn to page 37 to read more about our nine Generation Next winners.

THE BUZZ (Below) De Edmondson, store manager, and Chelsey Kaufman, assistant store manager, at the new Goodness Me! in Cambridge

EVENTS

National Retail Federation’s Retail’s Big Show returns to the Jacob K. Javits Convention Center in New York from Jan. 13 to 15. Visit nrfbigshow.nrf.com The Winter Fancy Food Show takes

place at the Moscone Center in San Francisco from Jan. 13 to 15. Visit specialtyfood.com The Grocery Foundation’s 2019 Night to Nurture Gala will take place at the Metro Toronto Convention Centre on Feb. 2. Visit gala. groceryfoundation. com for tickets.

Fruit Logistica 2019

runs from Feb. 6 to 8 at Berlin ExpoCenter City in Berlin, Germany.

Visit fruitlogistica. com for details.

GOODNESS ME! , GALLERIA SUPERMARKET

The Canadian Health Food Assoc­iation’s CHFA West returns to the Vancouver Convention Centre in 2019, running from Feb. 21 to 24. Visit chfa.ca for info.

OPENINGS NATURE’S EMPORIUM opened its fourth location in Woodbridge, Ont. in early November. The opening of the new 20,000-sq.-ft. store coincides with the natural health food retailer’s 25th anniversary. Nature’s Emporium also operates stores in Newmarket, Maple and Burlington—all in Ontario.

GOODNESS ME! NATURAL FOOD MARKET has

opened its 10th location. Located in Cambridge, Ont., the new store boasts a large selection of organic produce, Goodness Me! private-label meat, a large eatery with a rotating hot bar featuring keto and vegan diet options, and a “huge” natural grocery department.

The Vancouver neighbourhood of Kerrisdale is home to a brand new SAVEON-FOODS . Among the new location’s features: a fresh bar, with hand-cut fruit and veggies and fresh-pressed juice; The Save-On-Foods Kitchen, which serves up fresh sushi and sandwiches; a full-service pharmacy with on-site wellness advisors; as well as click-and-collect or home delivery of groceries.

Loblaw-owned T&T SUPERMARKET has added to its network of stores. It opened its first Aurora, Ont. store in early November and also opened a location in Waterloo, Ont. in early December.

The grocer, which specializes in Asian foods, celebrated its 25th anniversary in 2018, and in August opened a 70,000-­­­sq.-­­ft. flagship location in Richmond, B.C. (read more on page 32).

GIVING BACK

In November, GALLERIA SUPERMARKET held a kimchi-making workshop featuring celebrity chef Sang Kim at its York Mills store in Toronto.

This was followed by a communal kimchi-making session, during which more than 50 volunteers turned 1,500 heads of cabbage into kimchi to be donated to 15 local charities.

APPOINTMENTS SANDRA SANDERSON has joined Sobeys as its senior vice-president of marketing. An industry veteran, Sanderson has held senior positions at Walmart Canada and Shoppers Drug Mart as well as at Kraft and Coca-Cola. Most recently Sanderson was vice-president of fashion retailer White House Black Market in the U.S. DANA SOMERVILLE has been promoted to the role of chief marketing officer at Kraft Heinz Canada. Somerville joined Kraft in 1997 and most recently held the role of vice-president and head of brand build, innovation and R&D.

Crossmark Canada has added two CPG veterans to its team. MELISSA MARTIN, formerly with Kraft and Mondelez, has taken on the role of senior business account manager at Crossmark. Also joining Crossmark is PAUL HEWITT who has been appointed director, client services.

Hewitt was previously a longtime Nestlé Canada exec.

PEOPLE THE BOOZEFREE BREWER Ted Fleming brings craft quality to the growing alcohol-free beer market

By Danny Kucharsky Photography by Colin Way

Who you need to know

The Facts Who?

Ted Fleming Position

Founder and CEO of Partake Brewing What’s next?

New blonde, red and stout varieties; expansion of distribution across Canada and the United States

PEOPLE

T

ed Fleming is on a mission to make it easy for non-alcoholic beer drinkers to “partake” in high-quality craft beer.

His company, Partake Brewing, is making waves in the nascent craft non-alcoholic beer category for its taste, which, he maintains, is every bit as good as the regular stuff. It seems Partake’s founder and CEO isn’t alone in that opinion: launched in September 2017, his alcohol-free brew is already winning international awards.

Not bad for someone who never imagined that running a brewery—let alone brewing non-alcoholic beer—would be on his career path. Fleming earned degrees in geological engineering and economics from Queen’s University before going on to work in the water treatment and renewable energy fields.

In 2005, at the age of 28, he was diagnosed with Crohn’s, an inflammatory bowel disease. As a result, he eventually gave up alcohol. But the hockey and squash player found he missed socializing with his teammates with a beer after a game. And he wasn’t a fan of the non-alcoholic beer he was able to find on the market—“there really wasn’t a good substitute,” he says.

In 2013, Fleming took matters into his own hands and launched PremiumNearBeer.com, an online business that sold the best “near beer” he could find from abroad, along with non-alcoholic wine, cider and spirits. Several customers asked for non-alcoholic craft beer, but he was unable to source much product, which motivated him to make his own. Fleming experimented with a home brew system in his garage before connecting with Durham College’s Centre for Craft Brewing Innovation in Whitby, Ont., which helped him refine his recipe.

After a successful Kickstarter campaign, he made his first commercial batch and launched Partake in September 2017 with an India Pale Ale (IPA).

Just prior to the launch, Fleming made an appearance on Dragon’s Den, striking a deal with Minhas Breweries & Distillery co-founder Manjit Minhas for $300,000 in return for 50% equity. The deal later fell through—a blessing in disguise, given Partake’s subsequent growth.

In its first full year, Partake Brewing

broke even with $600,000 in sales and is now headed toward profitability.

Initially, he thought grocery stores would be Partake’s largest distribution channel, but the brewery recently inked a deal with the Liquor Control Board of Ontario (LCBO), which Fleming says is increasingly considering non-alcoholic beer as a complementary category to regular beer. Partake is now in all LCBO and The Beer Store outlets in the province.

The brew is also sold by about 140 retailers in Alberta and 100 in British Columbia including Whole Foods Market in Vancouver; and it’s available at a number of Metro and IGA locations in Quebec. Altogether, Partake is sold at close to 1,000 retailers across the country, with a growing number of restaurants and pubs also putting Partake on the menu.

What’s next? Fleming plans to expand Partake’s presence in the United States, although his immediate priority is to increase grocery distribution and fill in distribution gaps in the Maritimes, Manitoba and Saskatchewan. The company is also on the cusp on launching a blonde ale, with red and stout varieties coming up as the next core products. Ideally, Fleming says he would like to have five core varieties and seasonal products for summer, Thanksgiving and Christmas.

Fleming’s beverage is undoubtedly on trend. Made with all-natural ingredients, the beer has “an incredibly low” 10 calories per can and appeals to a range of consumers, from those on low-carb diets to those with diabetes, to people who don’t consume alcohol for religious reasons or simply health-conscious consumers seeking non-alcoholic alternatives.

Partake is also getting noticed by beer connoisseurs around the world. In September, for instance, Partake’s Pale Ale, its second variety, won gold in the World’s Best Low Alcohol Pale Beer category at the 2018 World Beer Awards in London.

“A lot of people are taking a different look at how they enjoy food and drink and what goes into the body,” notes Fleming, who recently moved to Calgary from Toronto so his wife could pursue a new job. “At the same time, they don’t want to change how they socialize. We’re able to bridge that gap for someone who still wants to go out, socialize and have a great-tasting beer.” CG

30 SECONDS WITH...

TED FLEMING What do you like most about the brewing industry?

I find it a very supportive community. It’s very collegial. There are lots of people who are willing to help you, whether it’s sourcing new product or questions about recipe development.

What’s some of the best advice you’ve received?

To take time to step back and look at the big picture. As a company we’re just a year old, and when we step back and look at what we’ve achieved, it’s quite impressive. But some days when you’re in the weeds, it’s hard to appreciate that.

What are your biggest challenges as an entrepreneur?

One of the biggest challenges is time management and just being able to focus on the most immediate and most high-impact tasks. And then there’s managing a team; we have some great people that work for us, but finding new people to bring on board, putting people in the right positions so they can be successful and creating an infrastructure to support our people is an ongoing challenge.

What do you like to do when you’re not working?

Having moved out to Calgary, we’re getting a bit more into winter sports like skiing. We have three kids, so we spend a lot of time with them trying to do some activities and exploring Calgary.

Being in a new city is kind of fun that way—you’re almost a tourist in your own town.

December 2018 / January 2019 Canadian Grocer

11

What’sNew NeW products iN grocery

Awesome Almonds

Walk on the Wild Side green ocean Wild argentinian shrimp are caught at sea in the deep, cold waters of the south West atlantic ocean. sourced in collaboration with fisheries and local government, green ocean ensures only sustainable, low-impact harvesting processes are employed — perfect for environmentally conscious consumers.

healthy snacking is becoming increasingly popular with canadians as more healthy, tasty, and well packaged brands in convenient single serve formats become available. Blue diamond snack almonds help lead the way with 43g foil pouch offerings in these delicious flavours: smokehouse, Wasabi & soy, sriracha and Blueberry. packed with a healthy amount of nutrients and taste, these easy-to-enjoy packs provide a solid energy boost and hunger relief any time of day for busy on-the-go consumers.

any green ocean product that features the shriMp With NothiNg to hide seal, is guaranteed to be packed and processed without additives, preservatives or antibiotics.

Taste the Light Jiference it’s smooth. it’s creamy. it’s now available in Light. With 25% less fat than Jif’s creamy peanut butter, Jif Light creamy peanut Butter is perfect on toast, in smoothies, or eating by the spoonful. Jif Light creamy peanut Butter was launched in canada in september to satisfy consumer demand for light products, which now accounts for 14% of total peanut butter sales. available in 1kg and 500g.

Special promotional feature in Canadian GroCer–december 2018/january 2019

IDEAS

Retailers, suppliers, shoppers, insights

DEMOGRAPHICS

Time to get familiar with Gen Z

GETTYIMAGES/VLG

Here are eight things you should know about this up-and-coming group of shoppers

By Rosalind Stefanac

W

elcome to the first generation of consumers who have grown up in a 24-hour news cycle and have never known a world without high-speed internet. Generation Z (roughly those between the ages of seven and 24), expect to be connected at all times, so it’s no wonder this group has some unique shopping traits and retail expectations. Here’s what the experts say every grocer should know in order to appeal to a Gen Z crowd.

They expect seamless service As a generation that sees physical and digital retail as intertwined, Gen Zs use their smartphones even when they’re shopping brick and mortar, says Katherine Cullen, director of retail and consumer insights at the U.S. National Retail Federation (NRF). “It’s not online versus offline, but rather about how to move easily throughout both environments,” she says. Gen Zs expect to use their phones while shopping to look up deals and product information—and

December 2018 / January 2019 Canadian Grocer

13

IDEAS E-COMMERCE they won’t stand for shoddy technol­ ogy either. In fact, according the 2017 Uniquely Gen Z report, which NRF pro­ duced in partnership with IBM, 62% of Gen Zs will not use an app or website that is hard to navigate, and 60% won’t use one that’s too slow to load.

They’re all about sharing As “digital nat­ ives” they want to be able to immedi­ ately share their opinion on products and seek feedback from friends, says Cullen.

“Unlike millennials who are more apt to write reviews when they’re unhappy, Gen Zs will spread their positive experiences with a brand or store, and want to upload videos about their experiences,” she says, adding that this group is also more apt to want to be part of marketing campaigns with brands. However, according to the Uniquely Gen Z report, only 21% would be willing to share personal life information with a brand and they still value trans­ parency from retailers.

They know their way around a kitchen Keep in mind that this generation has grown up in busy households, where they’re often fending for themselves when it comes to meals. “They have everything accessible on their phones so they don’t find cooking as intimidating, and they have better cooking skills than previous generations,” says Jo-Ann McArthur, president of Nourish Food Marketing in Toronto. Meal solutions they can handle on their own will be a selling factor for this young group, as will din­ ner options that can be eaten at various times throughout an evening.

“They have everything accessible on their phones so they don’t find cooking as intimidating, and they have better cooking skills than previous generations” They like leftovers Given their heightened awareness of food waste, Gen Zs also like leftovers more than other genera­ tions. “Super-size options have relevance with this group as they will use half and

14

save the other for the next day,” says McArthur. “Manufacturers and retailers should be looking at how to make these leftovers exciting again.”

Cheap snack foods are essential “Conve­ nience and price reign supreme right now,” says Shelley Balanko, senior vice-president of business development at The Hartman Group, which produced a 2018 report on Gen Z shopping habits.

“Even though their parents are doing most of the shopping, 80% still visit a brick-and-mortar store at least a few times a month and they’re huge snack­ ers,” says Balanko. Like typical teenagers they prefer sweet and salty snacks, she says, as well as soda and energy drinks.

Sustainability and social responsibility is not as high on their radar yet, but that is expected to change over time.

They need a place to meet Yes, the Gen Z world is primarily online, but they’re still looking for places to congregate with friends—and given their ages, the grocery store may fit that bill, says Bal­ anko. “They need hang-out spaces and retailers who build relationships with them now will probably capture their dollars in the future,” she says.

They influence their parents While they’re not doing a lot of the grocery shopping yet, don’t underestimate their influence on choices for the household. According to the Uniquely Gen Z report, 77% of them influence their family’s food and beverage purchases. Cullen points out that parents want to give their kids a voice and teach decision-making. “Ama­ zon has come out with a way you can allow your teenager to add or recom­ mend things on your account,” she says.

“While this could be a little dangerous, it speaks to the broader idea of involving kids in the household purchases.”

Their shopping habits will change over time As they progress into different life stages (i.e., moving into higher education and having children) retail preferences will change, say the experts. For example, online shopping is more prevalent in those aged 19 to 24 compared to the 13to 15-year-old group, according to the Uniquely Gen Z report. “It’s all about fig­ uring out how to target them now and then again in the future when they’re more independent,” says Balanko.

December 2018 / January 2019 Canadian Grocer

The grocery opportunity WHEN ALL TALLIED, CANADIANS ARE

expected to have spent about $41 billion in online purchases in 2018.

So how much did they spend on groceries? New ClickSpend data from Environics Analytics and J.C. Williams Group sheds some light.

The data captures online Canadian household spending across 14 cat­ egories, ranging from clothing and gardening supplies to food and gro­ cery. Here are some findings:

$2,748

is the amount the average Canadian household spends a year buying goods online.

5.6%

of all grocery purchases, including alcohol, in Quebec are made online (20% higher than the national average), making Quebecers the biggest shoppers of groceries online. In contrast, households in Saskatchewan spend the least; just 2.6% of all grocery and alcohol purchases are made online in the province.

$6.4 billion

is the amount Canadians are estimated to spend a year on online groceries.

While this represents less than 5% of total household spending in the category, it presents an “incredible” opportunity. According to the report, groceries will be a “category to watch,” as grocery retailers make a more aggressive push into the online channel. The report predicts that the category could easily eclipse clothing (the top online category) “if Canadian households respond to the increased offerings of online groceries.”

SOURCE: ENVIRONICS ANALYTICS AND J.C. WILLIAMS GROUP, CLICKSPEND 2018

GETTYIMAGES/FCAFOTODIGITAL

IDEAS CANADIANS WILL BE FORKING OVER MORE money for groceries next year. Food prices in Canada are forecast to rise 1.5% to 3.5% in 2019, according to the ninth annual edition of Canada’s Food Price Report by Dalhousie University and the University of Guelph. The annual food cost for the average Canadian family is expected to increase by $411 in 2019 to $12,157 for the year.

Ve g e t a b l e s w i l l s e e t h e h i g h e s t increases (4% to 6%), followed by food purchased at restaurants (2% to 4%).

Bakery and fruit prices are both predicted to increase between 1% and 3%, while the dairy and grocery categories are each expected to rise up to 2%. For the first time since its inception, the report forecasts decreases in the cost of meat (-3% to -1%) and seafood (-2% to 0%). In 2018, all of the expected changes in prices were accurately predicted with the exception of one food category: fruit.

“For the second year in a row, we are expecting [the vegetable] category to fluctuate significantly as a result of the reports we’re getting related to the weather,” says Sylvain Charlebois, a professor of food distribution and policy at Dalhousie University and one of the study’s authors. “That’s going to be problematic in terms of procuring vegetables and keeping prices at a decent level.”

As for the decreases in the price of meat, Charlebois says beef prices, in particular, increased so much in 2014 that “a lot of people started to look elsewhere because they thought beef was too expensive.” He expects the price will go down as grocery

Rising up We can expect food prices to climb 1.5% to 3.5% in 2019, says new report

By Rebecca Harris retailers “try to get some love back from consumers after the 2014 shift.”

Meanwhile, seafood price fluctuations will be due to availability, quality and traceability of certain imported products.

One key macroeconomic factor highlighted in the report is geopolitical instability, which will place substantial pressure on Canada in 2019. “With the regime that we have in America, you can

see embargoes and tariffs almost being imposed overnight, and that has a huge impact on food demand because you have to pay more or you just don’t have access to a certain product,” says Charlebois.

The report notes that 2018 brought Canada international trade uncertainty with the replacement of NAFTA with the United States–Mexico–Canada Agreement (USMCA). Under the new agreement, the agricultural sector will see doors open for American dairy, egg and poultry farmers worth about 3.6% of the total current Canadian market. While much attention is being paid to Canada’s dairy sector, all five supply-managed agricultural sectors (eggs, dairy, chicken, turkey and hatching eggs) will suffer setbacks due to the USMCA, according to the report.

One major food trend highlighted in the report is cannabis and its related food and beverage products. “Within the next 12 months, edibles will be allowed—a new beginning for the agrifood sector in Canada,” the report states.

“The legalization of recreational-use cannabis in Canada offers the industry a chance to develop an untapped market.

Enthusiasm appears highest within the beverage arena.”

Another key food trend for 2019 is the rise of plant-based foods. “Demand is on the rise and grocers will start to promote more of these options to consumers,” says Charlebois. “I expect a lot of plantbased products to be sold right next to the [meat products] instead of putting marginalized food products in some weird section of the grocery store.” CG

ANTICIPATED FOOD PRICE INCREASES IN 2019

Dairy 0% to 2% Bakery 1% to 3%

Fruit 1% to 3% Grocery 0% to 2%

Restaurants 2% to 4% Meat -3% to -1%

Vegetables 4% to 6% Seafood -2% to 0%

Total food categories forecast 1.5% to 3.5% December 2018 / January 2019 Canadian Grocer

15

IDEAS

SEEN & HEARD Big names in the industry have been taking the stage at recent conferences, tackling a range of hot topics. Here’s what they’ve been saying: ON NOT “SCREWING UP” FARM BOY

“Brands represent different things; they grow up differently and they represent different things to customers. And the worst thing you can do—and our company and other companies have made that mistake in the past—is to try to merge these brands and have them try to represent everything to everyone. Really, the big job with Farm Boy … is to stay out of the way, don’t mess it up, allow them to grow and allow them to have the menu of good things to choose from, if they want to, from a big company like Sobeys, like Empire Company, but just free them up to grow ... But it’s really important not to blend these brands together.”

MICHAEL MEDLINE, CEO of Empire Co. Ltd., at Canadian Grocer’s Thought Leadership CEO Conference

THE IMPORTANCE OF BEING “ALL-LINE” “Before customers go to the store, they’re looking for recipes, price comparing or assembling lists; and once in store, they’re checking off their lists, searching for coupons, seeking discounts and nutritional details—all using their phone. And there are now so many choices of products and places to get them that consumer loyalty is waning. Also waning is this notion of low- and high-consideration products ... Just take a look at the triple-digit [Google] search volume

increases over the past two years for items that we’ve traditionally considered low-consideration, such as the best toothbrush, shower curtain, or deodorant. Wherever your customer is on their purchasing journey, whatever they’re looking for, your goal should be to be there ‘all-line’ in those moments.”

NATALIE GREEN, Google Canada’s head of industry for food, beverages and restaurants, at Grocery Innovations Canada

The pricing epidemic “When we cut prices, we aren’t communicating value to the customer. Price sensitivity is an epidemic in the marketplace everybody is fighting, and we can blame Amazon, we can blame any number of factors, but at the end of the day what it tells me is we’re not doing our job.”

KEN WONG, distinguished professor of marketing, Smith School of Business, Queen’s University, at Grocery Innovations Canada

ON EMPOWERING YOUR PEOPLE

“I would love to have an environment where there’s no bureaucracy. Bureaucracy is just the enemy, it slows everything down … You’ve got to empower people to make decisions; you’ve got to empower people to take calculated risks and there will be no consequences if it doesn’t work—in fact, you celebrate and talk about that. I think if you do that, you create the ability in organizations that are big to still be nimble.”

Doubling down on innovation “We want to make sure we’re really doubling down on innovation and R&D so you’re going to see us double the size of our engineering and product team in San Francisco. We’re also opening an office in Toronto, which will have over 300 engineers and product managers working on the challenging problems we face as we bring groceries online.”

APOORVA MEHTA, CEO of Instacart, at Groceryshop

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December 2018 / January 2019 Canadian Grocer

JOHN GOLDSTEIN PHOTOGRAPHY, GROCERYSHOP

LEE TAPPENDEN, CEO of Walmart Canada, at Canadian Grocer’s Thought Leadership CEO Conference

FOOD BYTES

Joel Gregoire

A NEW BREED OF COFFEE DRINKERS

Younger Canadians don’t want an ordinary cup of joe, and they’re not stuck on traditional routines either COFFEE HAS BECOME a quintessentially Canadian drink, with most consumers starting their day with a brew. Because of this, the stakes are high—as are the rewards for coffee producers as they tend to consumers’ evolving demands.

Future success in the coffee market will revolve around companies’ ability to innovate to what young adults want.

According to Mintel research on coffee and coffee shops, younger Canadians show greater interest in exploring and experimenting with new types of coffee.

This behaviour distinguishes them from older consumers who appear more established in their coffee-drinking habits.

Older consumers, for instance, are more likely to veer towards ground coffee,

whereas younger consumers are more likely to turn to ready-to-drink varieties (for example, coffee in a can or bottle).

These differences suggest two things.

First, as consumers age, their coffee-drinking habits evolve, turning more to ground coffee after the age of 35. Second, the preference for ready-to-drink coffee among younger consumers points to the importance of investing in different formats and flavours to help them develop their taste for coffee and establish routines that can pay off down the road.

When it comes to flavour, Mintel’s research shows that while Canadians overall prefer stronger flavours, younger consumers gravitate toward lighter brews, as well as coffee with “new” flavours. For

HOW DO YOU LIKE YOUR COFFEE?

“Importance of strong versus light flavoured coffee among younger and older consumers”

32

Overall

%

25%

STRONG FLAVOUR

18-24

15%

21%

LIGHT FLAVOUR

SOURCE: MINTEL’S COFFEE AND COFFEE SHOPS CANADA 2018 REPORT || BASE: 1,698 INTERNET USERS AGED 18+ WHO DRINK COFFEE

those younger consumers, lighter or different flavours can serve as an entry point to coffee before they start to graduate to more traditional or intense flavours.

Aside from flavour, it’s important to recognize that younger consumers also approach coffee differently in terms of when and how they drink it. Older consumers, for instance, are more likely to view coffee as an important part of their morning ritual. By contrast, younger consumers are more likely to look for coffee options throughout the day. Given these differing habits, coffee producers can conclude that coffee isn’t just about the morning routine for younger consumers, so demand exists for innovation that meets their evolving needs as their day progresses. Such innovation can include mixed coffee-based beverages that blur the lines between providing a needed hit of energy and offering a treat for the afternoon or into the evening.

Finally, foodservice has proven particularly effective in meeting the evolving demands of younger consumers. And it’s worth noting that young consumers are more likely to perceive the brews sold at coffee shops to be of higher quality, affirming the channel’s importance for today’s younger cohorts. In response, retailers have stepped things up and are innovating and leveraging foodservice brands and their positioning to offer quality coffee in both traditional and less-traditional formats.

As coffee remains poised for continued growth, companies and brands that brew up innovation to address the differing demands of younger consumers will be better positioned to succeed in this dynamic category. CG

Joel Gregoire is associate director, Food & Drink at Mintel, the world’s leading market intelligence agency. Based in Toronto, Joel researches and writes reports on Canada’s food and drink industry. @JoelDGregoire

December 2018 / January 2019 Canadian Grocer

17

BEHIND THE TRENDS

Amanda Bourlier

GETTING TO KNOW THE EARLY ADOPTERS As grocers develop their e-comm strategies, they should be mindful of what makes this group tick THE PREVALENCE of omnichannel shop­ping and fast mobile internet connections are positioning Canada as an appealing place for digital development.

In fact, Canada ranks 14th globally on Euromonitor International’s Digital Consumer Index, which helps companies identify the most digitally attractive markets; and it is expected to jump to sixth place by 2022. In light of this, it’s no surprise that virtually every major grocer in Canada is exploring online strategies and developing new ways to

compared to 79% of 45- to 49-year-olds and 86% of people 60 and older). They also buy groceries online most frequently, with 10% and 9% of 18- to 29-yearolds saying they buy groceries online weekly and monthly, respectively. Urban consumers—those living in cities with 100,000 residents or more—are also more likely to report buying groceries online.

Four percent of city residents and 8% of large city residents buy groceries online on a weekly basis. Education also plays a role: consumers with graduate degrees are most likely to buy groceries online weekly (14%) followed by those with a university degree (6%) and secondary school graduates (3%), respectively.

In many respects, early adopters of new technologies are also those who are gravitating toward online grocery shopping in Canada connect with consumers. Euromonitor International’s Lifestyles Survey profiles the early adopters of online grocery shopping in Canada. Here’s a look: YOUNG, URBAN, EDUCATED In many respects, early adopters of new technologies are also those who are gravitating toward online grocery shopping in Canada. Consumers between the ages of 18 and 29 in Canada are the least likely to say they never buy groceries online (56%,

18

UNDAUNTED STRIVERS AND CONSERVATIVE HOMEBODIES

Beyond demographics, personality-driven consumer types also yield insights into the perspectives of current online grocery shoppers in Canada. “Undaunted strivers” are the most likely to purchase groceries online, with 15% buying groceries online weekly and another 15% buying monthly. Undaunted strivers are tech-savvy, have high usage of online and mobile shopping platforms and are avid followers of the latest trends, so it follows that this consumer type is the most open to trying new ways of shopping for essentials. These shoppers are highly motivated by prestige and impulse purchases, so grocery players

December 2018 / January 2019 Canadian Grocer

seeking to target these customers should focus on premium products and make it easy for customers to place and receive their order in a timely manner.

An emerging consumer type for online grocery purchases in Canada is the “conservative homebody,” a cohort driven by value for money. While likely to stick to their day-to-day purchases, this consumer is also open to browsing new products and shopping options. The key to reaching these consumers is to introduce a moderate level of new features, such as the ability to order online, without disrupting the core purchase experience. As a result of these preferences, this group is a strong target for click-and-collect initiatives. Another online grocery strategy for this consumer type is to nudge them toward private-label products. Conservative homebodies are generally open to private-label products to save money, so long as the products deliver the same features as national brands.

GROWING THE ONLINE GROCERY MARKET Most Canadian grocers are in the early stages of developing their omnichannel and e-commerce capabilities. The retailers that will find the most success with online grocery will work to both encourage early online grocery shoppers to shift more of their purchases to e-commerce and expand to new consumer groups in order to grow the market. The strategies and tactics that will appeal to early adopters will look different than those that draw new consumers to online grocery. As a result, best-in-class online grocery players will develop a variety of online shopping methods and features to offer a suite of services from which a shopper can choose the options that best suit his or her preferences. CG

Amanda Bourlier is a research consultant at Euromonitor International, an independent provider of strategic market research. Euromonitor.com

2019 industry leadership supplement from Canadian Grocer

fresh the

report

Special promotional Feature

the

freshreport

FRESH PERSPECTIVES This

RON LEMAIRE

PRESIDENT, CANADIAN PRODUCE MARKETING ASSOCIATION

“

year was a time of progression for the fresh fruit and vegetable industry. Our sector experienced growth and searched for new innovations to satisfy consumers. The new United States-Mexico-Canada Agreement (USMCA), formerly known as the North American Free Trade Agreement (NAFTA) was agreed to in principle. Within the fresh produce industry, we were pleased to see no major changes affecting the state of business and trade relations with the United States and Mexico, giving us a promising outlook for the future.

Major trends indicated that shoppers are looking for fresh, healthy and convenient foods. With the World Health Organization’s projection that by 2020, 73% of deaths will be due to preventable diseases (such as cardiovascular disease, cancer, chronic obstructive pulmonary disease and type 2 diabetes), shoppers are turning to healthier options to improve their quality of life.

Canadians are striving to eat better: more than half of all respondents in a 2018 Nielsen survey stated that they actively seek out and purchase products that protect their family’s health. Specifically, consumers are keen to avoid foods that contain artificial ingredients, while looking for food made from fruit and vegetables, with low or no sugar and which are high in fibre.

We are also trying to eat more conveniently and eco-friendly. Buyers are more socially aware and willing to pay premiums for environmentally-friendly packaging. Ease of preparation is also top of mind for shoppers, supporting a movement towards fresh meal kits, while keeping physical wellbeing in mind.

Canadians are striving to eat better: more than half of all respondents in a 2018 Nielsen survey stated that they actively seek out and purchase products that protect their family’s health.

Canadians’ trips to traditional brick-and-mortar stores have decreased while individual visits to online stores increased by 9%. In this technological age, time is of the essence, and the way we shop as well as the products we’re buying are a reflection of our culture.

In 2019, we are sure to see our sector continuing to evolve and innovate to meet industry demands and consumer expectations. With that, we will see more companies committing resources to focus on high-tech and healthy integrations. These continuing trends bode extremely well for the future of the produce industry.

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d e c e m b e r 20 18/ j a n ua r y 2019

150000 120000 90000 60000 30000 0

1.0 0.8 0.6

For 125 years, Del Monte has stood

0.4 0.2

as the freshest name in produce.

After all, we’re fruit fanatics, which means we’re also quality fanatics.

Innovation fanatics. Healthy-lifestyle fanatics. Food-safety fanatics.

Sustainability fanatics. And, while we obsess over all the fruits we grow, we’re bananas about bananas.

FRESHDELMONTE.COM

@DelMonteFreshProduce

1-800-950-3683

@DelMonteFresh

FRUITS.COM

@DelMonteFresh

FRUITFANATICS.COM ©2018 Del Monte Fresh Produce N.A., Inc.

DelMonteFresh

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BANANAS Banana Sales in Canada 800000 700000 600000

$627,254.56

500000

$624,419.11

392,408.70

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393,254.45

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Fresh from the

HEART EUROPE of

BELGIUM Y

Q

UA IT L

www.europeanvegetables.ca For more informations, please contact your local distributor.

CAMPAIGN FINANCED WITH AID FROM THE EUROPEAN UNION

The content of this advertisement represents the views of the author only and is his/her sole responsibility. The European Commission and the Consumers, Health, Agriculture and Food Executive Agency (CHAFEA) do not accept any responsibility for any use that may be made of the information it contains.

Belgian endives

white gold from Belgium, the heart of europe

Belgian endive is the white gold and pride of Belgium. This Belgian specialty is a unique product that adds extra value to vegetable departments. It is available all year round, and provides the versatility that Canadian consumers are looking for in their cooking.

B

elgium is the largest grower of endives in the world. Most of the Belgian endives come from family businesses which allows the farmers to feel personally involved in their own products resulting in a better crop.

Why choose Belgian products?

This Belgian quality label for fruit and vegetables — Flandria — guarantees consumers they are buying environmentally friendly products that provide the best in quality and freshness. Only top quality products with a perfect taste and impeccable appearance earn this label. Each farmer must adhere to very strict rules in terms of quality and size and markings on the box can be used to trace the package back to its origin.

The specific quality characteristics of Flandria endives are: • Fresh appearance • No wilting signs, sprouting, top edge and yellow or discoloured leaves • Well-shaped solid leaf rosette and very well developed • Weight of at least 200g/head • Excellent quality • Smooth cut end • Uniform heads • Core has to have a yellow colour over at least 1/3 of the plant • No frostbite • Non-blanched part should have the typical colour of the variety

Healthy and delicious

The Belgian endive is rich in fibre, vitamins A, B1 and B2 and C, calcium and phosphorus and is low in

calories. One hundred grams of raw endives contains 12 calories. Canadians can prepare Belgian endives in a variety of ways - steamed, raw in salads or filled as an appetizer. And thanks to its delicate taste, consumers can combine Belgian endives with a number of ingredients like fish, chicken, beef, or fill the leaves with shrimp or blue cheese for an easy and healthy appetizer.

Interested in sourcing Belgian endives? Ask your Belgian supplier or find a specialist at: europeanvegetables.ca.

the

freshreport

fresh-cut veggies New and innovative products aim to satisfy consumer’s ongoing demand for fresh and easy-to-prepare meals throughout the day. Jacob Shafer, senior marketing and communications specialist for Mann Packing, provides some insights into today’s trends driving the fresh-cut veggie segment.

How are fresh-cut veggies performing in Canadian supermarkets and what are the category trends? the fresh-cut vegetable category is performing well with the addition of more and more new and innovative products like Mann’s fresh veggie Noodles & rice. the noodle products feature unique, chef-inspired cuts that work perfectly as a pasta-swap. the rice products are made from a variety of colourful vegetables and are a convenient alternative to traditional rice, with fewer calories and carbs per serving. the development of the new line speaks to increased consumer demand for vegetables that can easily be used in place of a traditional carb.

What are some of the latest innovations in fresh-cuts and how do these new products meet consumer needs?

Available in the u.s. early next year and hopefully in canada the following year, Nourish Bowls® Breakfast is the newest addition to the award-winning line of warm, veggie-based meals. there are two delicious new flavours: Denver scramble and fiesta scramble.

Just add 1-2 eggs, micro-wave for 4 minutes and enjoy. With 330 calories or less and up to 25 grams of protein, these new bowls bring to the breakfast table all the convenience, nutrition and freshness of Mann’s other Nourish Bowl® brand offerings.We aimed to capitalize not only on the success of the

S p e c i a l p r o m ot i o n a l F e at u r e i n

Nourish Bowls® product line, but also on the massive growth of the breakfast meal occasion. A 2017 technomic consumer trends report on breakfast found that 83% of foodservice operators have increased breakfast hours in the past 3 years and that 93% of Americans think that breakfast is the most important meal but only 44% eat it daily.

How do you address environmental concerns about processing and packaging? virtually all packaged convenience vegetables in the retail market are sold in bags, some with gussets, zippers, or other attributes. this minimizes packaging waste, which is a key social responsibility initiative with Mann’s. this also reduces cost to the retailer and the consumer and saves space in refrigerators. All of our corrugate and plastic packaging is recycled.

What can retailers do to encourage better sales of fresh-cut produce? retailers can create healthy destination categories in their stores; a place where consumers can conveniently find fresh vegetables, snacking trays, and specialty vegetables. Destination categories help consumers find new and innovative products. retailers can expand shelf offerings of high demand cut veg items and should understand the data and the trends driving the category and take advantage of all selling opportunities.

d e c e m b e r 20 18/ j a n ua r y 2019

the

freshreport meat

While meat remains a traditional food group for most Canadians, the category is changing and evolving to meet consumer demand.

Here are four trends to watch in 2019.

Free From

Meat snacks on the rise

everyday canadians are making a switch to their meat-buying habits. they are educating themselves on the impact of large-scale farming and on people’s health and the planet. canadians love meat, and don’t want to give it up, so they are figuring out the best ways to consume meat and not feel a sense of guilt. a recent mintel survey noted that 53% of canadians said they were interested in free-from meats followed by an interest in grass-fed beef (49%) and certified organic meats (40%). as a result, to answer this need, meat producers both here and abroad are making big moves and investing in freefrom meat.**

High protein, low calorie, convenience and portability remain some of the top consumer trends when it comes to food. So it’s no surprise that a growing range of meat snacks are flying off shelves in grocery stores. Sales of meat snacks, including jerky, bars, sticks and pork cracklings, grew 15% in dollars and 18% in volume last year, according to nielsen. as well as introducing lots of flavour innovations, manufacturers are highlighting health and environmental attributes such as “grass-fed”, “lean cuts”, lower sodium and lower nitrates.”Snacking is growing and there’s a push for protein,” says joel Gregoire, senior food and drink analyst at mintel.** Having several on-the-go meat options make a lot of sense for retailers.

Focus on animal welfare each year, about 70 billion animals are farmed for food across the world. How those animals are treated has become a growing concern for consumers who expect meat producers to ensure good animal welfare. up to two-thirds of canadians are concerned about the ethical treatment of animals and according to mintel, 49% say they are interested in meats sourced from humanely raised animals. this trend is growing as more and more canadians are concerned about the food in their diet, and how and where it is sourced. With this increasing concern, there is an upward trend in the meat category for certified Humane offerings. improved animal welfare could add value to the meat industry. according to nielsen, 35% of consumers are willing to pay more for ethically raised meats.

S p e c i a l p r o m ot i o n a l F e at u r e i n

Keeping it affordable consumers minding their pocketbook will take cues from how cultures around the world make lessexpensive cuts like brisket taste great. likewise, retail sales of meat will also receive a boost from growth in consumption of pork, which is expected to maintain its low cost advantage over beef. in addition, many previously overlooked cuts of pork (such as pork shoulder) are experiencing a resurgence in popularity both at retail and in restaurants.*

*meat & poultry: u.S. retail market trends & opportunities, packaged Facts, 2017 ** canadian Grocer magazine, oct/nov 2017

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For 125 years, Del Monte has stood as the freshest name in produce. After all, we’re fruit

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fanatics. And, as the world’s

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leading grower and marketer of fresh pineapples, we’re also innovation fanatics. Our Del Monte Gold® Extra Sweet Pineapple has revolutionized the category and boosted pineapple consumption around the globe.

How ’bout them pineapples?

FRESHDELMONTE.COM

@DelMonteFreshProduce

1-800-950-3683

@DelMonteFresh

FRUITS.COM

@DelMonteFresh

FRUITFANATICS.COM ©2018 Del Monte Fresh Produce N.A., Inc.

DelMonteFresh

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PINEAPPLES Pineapple Sales in Canada 120000

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100000 80000 60000

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Seasonality Index for $ Sales 150

120

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Source: Nielsen MarketTrack, all channels, 52 weeks ending October 13, 2018.

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STORE PROFILE

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December 2018 / January 2019 Canadian Grocer

WHERE SEAFOOD IS THE STAR At its new flagship location in Richmond, T&T is stepping up its fresh seafood offer

By Shellee Fitzgerald Photography by Tanya Goehring “NOBODY DOES SEAFOOD better than T&T,” proclaimed

(Above) T&T Supermarket’s new concept Seafood Bar (Right) T&T CEO Tina Lee

Tina Lee, CEO of the supermarket chain at the grand opening of its new flagship store in Richmond, B.C., in August. A bold statement, but Lee went further: “And we’re one-upping that, making [T&T] not only the best place to buy seafood but also the best place to eat seafood.”

Indeed, fresh seafood is front and centre at the newest Richmond store (the city, part of the Metro Vancouver area, is home to two other locations). The star attraction at the 70,000-sq.-ft. Asian-focused supermarket located in the Lansdowne Centre is the Seafood Bar, a first in the chain’s network and— according to Lee—a first in Canada. The in-store dining concept was inspired by visits Lee and her team made to markets and restaurants in places like Shanghai, China and Santa Monica, Calif.

At the Seafood Bar, customers select the seafood they want—with options including spot prawns, canner lobster, mussels, clams and scallops—from December 2018 / January 2019 Canadian Grocer

33

STORE PROFILE tanks filled with live product.The selection is weighed by staff then sent to the cooking station via a zipline-like contraption suspended from the ceiling (staff have dubbed it the “Sea-to-Sky Highway”). At the cooking station, in-house chefs stand by to prepare the seafood once customers have paid, selected a sauce (Cajun and Thai are among the options) and cooking method (steamed or boiled).

Sides can be added as well, and once the dish is ready, customers eat it in a sea-themed dining area (complete with lobster-trap lighting fixtures) bordered to the right by giant seafood tanks. There are more than 4,000 gallons of water in the store, according to Lee, who notes “that’s enough to fill your backyard swimming pool.”

In-store dining is part of a strategy currently being employed by a wide swath of grocers in a bid to get consumers into the store, have them stay longer and spend more. And many grocers such as T&T are upping the ante in terms of quality and experience. “We’re offering restaurant-quality seafood at supermarket prices,” said Lee of the concept. On this day, the strategy appears to be working, as the dining area is crowded with customers testing out the service. And in the weeks following the opening of the Lansdowne store, local media reported long wait times (up to 60 minutes) at T&T’s Seafood Bar. While fresh seafood is the star of the show at T&T

The Facts Location

Richmond, B.C. Size

70,000 sq. ft.

Specialties

Dine-in Seafood Bar; Asian Street Food quick-serve area; Asian specialty foods; large fresh departments

At the new concept Seafood Bar at T&T Lansdowne, customers select fresh seafood, have it cooked on the spot and they can eat it in the dining area

(Above) Staff keeping up with demand at T&T Lansdowne’s busy seafood department (Left) Among the unique features at the store is the weigh station in the centre of the produce section

Lansdowne, it’s not the only draw. At 70,000-sq.-ft., the store, housed in a space formerly occupied by Target, is the largest in the network and roughly double the size of a typical T&T. In addition to large fresh produce, meat, bakery and, of course, seafood departments, the extra space allows room for features not typically found in a T&T. As Lee guides me through the bright and airy store, she points out a number of firsts. The Lansdowne location, for instance, has a Starbucks and is the first in the T&T network to offer self-serve checkouts (14 stations).

Another unique feature of the store is the weigh station located in the middle of the produce department. Lee says T&T’s customers like to be able to touch and smell product. With this in mind, most items in the produce department are loose. Once customers have selected their items they can take them to a weigh station where staff will weigh and add a price sticker to the produce so shoppers can save time at the checkout.

While the store is filled with Asian specialties, the ready-to-eat Asian Street Food area is a highlight. At this quick-serve station, staff buzz around a kitchen preparing an array of “authentic” Asian dishes from Taiwan, Hong Kong and China. About 30 different foods, which Lee says are inspired by Asia’s popular

night markets, are available including sesame pancakes, steamed pork buns, lamb soup, crispy rice noodles and popcorn chicken.

Another fun feature at the Lansdowne store is something called Treasure Hunt. Located near the entrance of the store, the Treasure Hunt is a cabinet filled with exclusive, higher-ticket goods from Asia.

On this day, there’s a Sori Yanagi southern iron deep pot going for $268, as well as Toyo Rice (“The world’s best rice”) for $198 and Xi Gua Narcissus Tea for a whopping $688. “They’re really hard to find, collectible items and we may have just 20 units of each,” explains Lee, adding that the Treasure Hunt offers something unique for customers.

As the centre of the Chinese community in B.C.’s Lower Mainland, Lee said it was fitting that T&T— the largest Asian grocer in Canada with 26 locations and growing—open its flagship in Richmond. It’s also a community where T&T, acquired by Loblaw in 2009, has deep roots. Richmond was the location of one of the first stores opened by Lee’s parents Cindy and Jack back in 1993. And after 25 years in business, T&T is showing no signs of slowing: in recent weeks the retailer has opened stores in Aurora and Waterloo, both in Ontario, and another Vancouver location (Kensington Gardens) is opening soon. CG December 2018 / January 2019 Canadian Grocer

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Save-On-Foods is thrilled to congratulate its very own Generation Next Award winner, Darren Bavaro, for his innovation, commitment to the grocery industry and outstanding customer service that make Save-On-Foods Cambie a great place to work and shop.

Congratulations

Darren Bavaro Store Manager, Save-On-Foods Cambie

and to all of this year’s Generation Next Award winners!

Vince’s Market is proud to congratulate Category Manager

Nigel Oliver

on earning the Canadian Grocer 2018 Generation Next Award.

Well deserved!

And congratulations to all the 2018 Generation Next winners for your achievements in the Canadian grocery industry. www.vincesmarket.com

R I S I N G

GENERATION NEXT AWARDS

With all the immense yet exciting changes on the horizon for the grocery and CPG industries, we need strong young leaders to guide us into the future. Lucky for us, we’ve got them. Canadian Grocer’s 2018 Generation Next award winners—all under the age of 40—were chosen for their leadership, innovative work and commitment to the industry. From store managers and sales managers to innovation leaders and head office execs, read on to find out why this year’s crop of Generation Next winners are so deserving of this award.

By Rebecca Harris

S T A R S

December 2018 / January 2019 Canadian Grocer

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GENERATION NEXT AWARDS

LINDSEY ABRAHAMS District sales manager Wonderful Sales

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HAILING FROM Australia with a CPG back­ ground, Lindsey Abrahams moved to Toronto in 2014 and began working as an analyst for Wonderful Sales. In early 2018, he was promoted to district sales manager (part of the Wonderful Sales Canada leadership team), a role in which he handles a range of customers including grocery, foodservice, produce terminals and duty-free.

Contributing from both an analytics and sales standpoint, Abrahams helped double volume of Wonderful pistachios since 2015. Two other brands he represents, Halos mandarins and POM Wonderful, are No. 1 in their respective categories. And Abrahams was instrumental in redesigning category planograms for several of his accounts, increasing sales and reducing shoppers’ confusion.

Abrahams volunteers with the Canadian Pro­duce Marketing Association (CPMA), and he also led Wonderful Days of Caring, an annual initiative that involves the team volunteering to help local causes.

“What inspires me is that I’m selling great brands that are healthy, while promoting the health-focused produce industry as a whole,” he says. “It’s a fun, dynamic industry and it’s full of good people, so it’s easy to get motivated.”

CHRISTIAN ARBEZ Director, store marketing Sobeys

AS A TEENAGER working part time at Thrifty Foods in British Columbia, Christian Arbez wasn’t thinking too far into the future. “But, as I realized how multi-faceted the grocery business was and took more commerce courses in college, it became clear this was my future career path,” he says.

Now a 21-year veteran of the company, Arbez has made an indelible mark on both the business and the community. He was respon­ sible for the creation and direction of Thrifty Foods’ 40th birthday campaign throughout 2017. Each month, Thrifty Foods featured a different non-profit organization in various paid media channels. A local “product of the month” was selected and a portion of sales was donated to the featured organization. In total, more than $310,000 was donated.

Another career highlight for Arbez was integrating two platforms—ThriftyFoods.com and ThriftyFoodsOnline.com—into a singular, integrated e-commerce-enabled website. “It brought a lot of efficiency to our business, drove down operations costs and improved the user experience,” he says.

Since February 2018, Arbez has been in a national marketing role for Sobeys. “I’d like to continue to challenge myself, realize my full leadership potential and continue to add value to this industry,” he says.

38

December 2018 / January 2019 Canadian Grocer

TERESA BLAKNEY Brand manager, brand development

DARREN BAVARO Store manager Save-On-Foods

Conagra Brands

DARREN BAVARO joined Save-on-Foods when he was 16 and worked his way up to store manager at Vancouver’s Urban Fare supermarket. In 2016, he became store manager at Save-On-Foods in Vancouver.

Bavaro is known as a truly people-focused leader whose positive impact on his store’s culture brings significant results. The annual team member survey shows his team feels more appreciated and more invested in their jobs and, in turn, his store sales increased by 9% this year.

Bavaro describes his leadership style as intimate. “I want to know the people I’m working with and I want to be a part of their lives. To do that, I have to be very open about who I am,” he says. “I bring all of myself to work and I think when people see you are truly invested in what you do, they respond to that.”

PHOTOS OF C. ARBEZ, D. BAVARO, M. BELANGER, T. BLAKNEY BY JOHN GOLDSTEIN PHOTOGRAPHY

With a commitment to diversity, Bavaro was the first Save-On-Foods store manager to represent the company in the Vancouver Pride Parade in 2017. He is also Save-OnFoods’ first male manager to be involved in the Inspire Network, the company’s network supporting career advancements for women.

TERESA BLAKNEY had a seven-year career in marketing at Nestlé Waters in Shanghai before moving to Toronto in 2014. After a yearlong stint at Campbell Soup Company, she joined Conagra Brands, where she’s had a string of major successes.

MARIE-CHRISTINE BÉLANGER Director, national procurement, grocery Metro

ALWAYS HAVING the consumer in mind has led to many successes for Marie-Christine Bélanger, who joined Metro in 2005 while still a university student. “I’m always thinking about the consumer and trying to make sure that what we are putting in place makes sense for them,” she says.

After visiting Conagra’s tomato plant in Dresden, Ont., Blakney identified an opportunity to market heirloom tomatoes, which would increase Hunt’s margin by 10%. “I discovered one of our varieties is actually heirloom tomatoes, but we weren’t leveraging this unique selling proposition,” says Blakney.

She created a winning business case and launched the product in early 2018.

Blakney is also leading the innovation on Conagra’s frozen portfolio. She launched new Healthy Choice Power Bowls and Frontera, a U.S. frozen Mexican food brand she brought to Canada in July 2018. Another nine new frozen food products are set to launch in early 2019.

“There are so many things you can do with innovation if you have a strong business case,” she says. “My approach is to be openminded, consistently educate myself about what’s in market, and figure out the key consumer struggles.”

In 2015, Bélanger was tasked with launching organic and natural products at all Super C stores. Working with another colleague, Bélanger developed Super C’s offer and positioning, tailored to individual stores.

Another key accomplishment was developing a new business model for smaller Super C stores. Bélanger reviewed practices, product offerings, merchandising plans and assortments. “We developed a concept so that small stores could be more efficient and profitable, but at the same time, we had to ensure that we are still fulfilling the consumer needs,” she says.

Appointed to a new director role in June 2018, Bélanger says she doesn’t have a specific career goal in mind. “As long as it’s challenging me and I’m still learning things—that’s what is important.”

December 2018 / January 2019 Canadian Grocer

39

GENERATION NEXT AWARDS

NIGEL OLIVER Category manager Vince’s Market

2 0 1 8

NIGEL OLIVER started working at Vince’s Market in high school, with a job stocking milk. He worked his way through school, becoming a grocery supervisor after completing university and working as an analyst throughout accounting school. When Oliver received his CMA/CPA designation in 2014, he joined the management team at Vince’s Market.

Oliver’s biggest success to date has been leading the setup and the day-to-day operation of Vince’s Central Support (VCS), a new business unit that includes a central production commissary, warehouse and platter production to support the company’s five stores in the Greater Toronto Area.

He managed the growth of centrally producing 24 value-added Vince’s Own products to more than 200. “With the commissary, we’re creating consistency, we can control our costs, and we’re ensuring that the quality is there,” says Oliver. He continues to manage processes and procedures for VCS, while category-managing critical grocery store departments.

With his accounting background, Oliver is motivated by numbers. “I like being able to look at a number and then be challenged to fix it and make it better,” he says.

NENA PIDSKALNY Store brands specialist

Federated Co-operatives Limited (FCL) As a store brands specialist for FCL, Nena Pidskalny works on every step of the product development process, from “the big idea,” to determining the product size, flavour profile and price point.

In just four years, she’s launched hundreds of new private-label products, with a key focus on premium and ultra-premium products. She has also amassed an impressive trophy case, including five Canadian Grand Prix New Product Awards for products such as Co-op Gold Buttercrunch Toffee, Co-op Gold Perogies and Co-op Gold Sorbetto. “To get recognized from the industry and have a panel of experts say ‘this is the best in the category’ is really rewarding and a very big accomplishment,” says Pidskalny.

Pidskalny dedicates time and resources to nurture small, local entrepreneurs, which has led to developing collaborative, long-term relationships with suppliers. “A lot of our local vendors have never dealt with a chain before, so it’s really a labour of love,” she says. “But it’s great to see the small vendors flourish in this environment.”

40

December 2018 / January 2019 Canadian Grocer

CONGRATULATIONS MAT STIVER-BALLA! ONE OF CANADIAN GROCER’S

GENERATION NEXT AWARD WINNERS

Congratulations, Nena!

Your Generation Next Award is a much-deserved recognition of the dedication, creativity and passion you bring to work every day.

It is our privilege to have you on our team.

is proud to congratulate

Marie-Christine Bélanger, Director, National Procurement, Grocery, Metro Her leadership, innovation and commitment to the grocery industry have earned her a well deserved Canadian Grocer’s Generation Next Award

®

CO-OP and design trademark are registered trademarks of TMC Distributing Ltd., Saskatoon S7K 3M9.

FEDERATED CO-OPERATIVES LIMITED

GENERATION NEXT AWARDS

KEVIN REIDER Director of business development A. Lassonde Inc.

2 0 1 8

KEVIN REIDER joined A. Lassonde as a key account manager in 2015 representing the company’s vast array of juice and beverage brands.

He joined the private-label team in 2016, and is responsible for developing and managing new private-label products for top Canadian retailers.

To date, his team has developed and launched more than 30 new SKUs, including premium chilled iced tea and lemonade, while optimizing customers’ assortments.

Reider has also picked up new business and grown key accounts in Western Canada to help further A. Lassonde’s footprint as a premier private-label provider in Canada.

Reider prides himself on building strong relationships with A. Lassonde’s retail partners, based on trust and transparency. “I’m upfront with everything and use my honest approach as an asset to show how a project is going to work for both sides,” he says.

Looking to the future, Reider would like to advance to a senior leadership position, while still maintaining a sales aspect in the role. “I’d like to continue to be customer-facing because I enjoy the interaction with the retailers so much,” he says.

MAT STIVER-BALLA Sales planning manager (Glad, Brita, Hidden

Valley Ranch & Kingsford Charcoal) The Clorox Company MAT STIVER-BALLA played a key role in the biggest re-launch in the history of Glad.

For the past two years, Stiver-Balla has worked as the sales lead on Project Genesis. The massive project included a survey of 8,000 consumers to understand their pain points, how they shop the waste category and how to reduce confusion at the shelf. Stiver-Balla worked with a team on developing and testing a new strategy that they believe will reshape the waste category.

In February 2019, Glad is rolling out its new look and feel, including new products, sizes and packaging.

Another career highlight for Stiver-Balla was spearheading an effort to provide Clorox care packages for Canada’s wheelchair basketball team at the 2016 Paralympic Games in Rio de Janeiro.

A former sprinter, Stiver-Balla says what motivates him in the business world is seeing the finish line. “The finish line is the solution to a problem and I’m not sure exactly how we’re going to get there, but I have an innate motivation to come up with the best solution possible.” CG

42

December 2018 / January 2019 Canadian Grocer

1918

SINCE

lassonde

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Lassonde is proud to recognize Kevin Reider as a RISING STAR in the grocery industry.

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Congratulations to all the winners of the 2018 Generation Next Award.

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Childhood Hunger Across Canada According to a 2017 UNICEF report*, Canada ranked 37th out of 41 wealthy nations with access to nutritious food for children with an estimated 1 in 5 children going to school hungry. This is a real wake up call for a high-income country like Canada, and highlights the need for campaigns such as Toonies for Tummies.

The Grocery Foundation’s Toonies for Tummies campaign brings together retailers and manufacturers, united in one common goal: to help feed children at school. This is an incredibly important cause as research continues to link student nutrition to increased attendance, classroom participation, improved problem solving, test scores, graduation rates and other social skills building, not to mention enhanced nutrition knowledge.

Toonies for Tummies campaign sponsors are crucial to the success of the program. The more sponsors, the bigger the program and the more children who will benefit from a nutritious meal to start their day.

Toonies for Tummies is a powerful campaign that resonates with consumers as they increasingly look

will bring home the message of just how easy it is to donate.

to support companies that are demonstrating a corporate social responsibility in the communities they serve.

Sponsor participation helps provide a marketing campaign that includes out of home advertising, social media posts and brands showcased in flyers and on the shelf at participating retail banners. Sponsor funding enables The Grocery Foundation to ensure that 100% of consumer donations (Toonies collected in store) remain in the local communities where they are made.

Toonies for Tummies continues to expand providing more value to its sponsors and more help to retailers and their staff to rally behind the program and to drive donations in store and online.

In the 2018 campaign The Grocery Foundation and its partners were able to fund schools that were on wait lists, especially in the west where the program and number of schools funded continues to grow. The addition and enthusiasm of Buy-Low Foods and Nesters Market alongside the ongoing commitment of SaveOn-Foods, whose leadership made the expansion out west possible, enabled this new funding.

2019 is shaping up as a milestone year for The Grocery Foundation with a record 21 sponsors signed to date and a new goal of $1.2M set for this year’s donations - the partners surpassed the original goal of $1M. And this year will bring a new campaign centred on a #ToonieChallenge that

Shaun McKenna, the Foundation’s Executive Director is positive of the campaign’s momentum but admits there is a ways to go. “There’s still a lot of education that needs to go on with the public, as well as in our industry. The future generation of Canadians, their health, their academic success, all hang in the balance. We are a big industry with a big reach.

We have done so much, but we can still do more.”

Toonies for Tummies 2019 will kick off in the west with Save-OnFoods (Jan 24-Feb 6) and will return to Ontario with Longo’s (Feb 1-21), Metro and Food Basics (Feb 7-21), and select independents. The program will end in March at Buy-Low and Nesters Markets (Feb 24-March 10). The campaign will include an integrated marketing campaign, social media, flyers, and in-store POS.

For more information on the Toonies for Tummies campaign and how you can become a sponsor or retailer partner, please visit: tooniesfortummies.ca

* Building the Future: Children and the Sustainable Development Goals in Rich Countries. UNICEF Office of Research - Innocenti SPECIAL PROMOTIONAL FEATURE IN CANADIAN GROCER-DECEMBER 2018/JANUARY 2019

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RETAIL TRENDS

What

lies

ahead?

The last few years in grocery retail have seen dramatic change and there’s every reason to believe the coming year will bring more of the same. What trends are gaining steam right now that could transform the business of selling groceries in 2019 and beyond? Here, we take a look at some big ones

BY SHELLEE FITZGERALD, CAROL NESHEVICH AND CHRIS POWELL

December 2018 / January 2019 Canadian Grocer

47

RETAIL TRENDS Battle of the e-comm/delivery titans

A recent Dalhousie University survey asked consumers, “Have you purchased groceries online?” Just over 34% responded, “Not yet, but I’m thinking about it.” As more of these shoppers who are “thinking about it” decide to give online grocery shopping a try, Sherk believes 2019 is the time for grocers to get customers hooked on their particular online grocery service so it becomes a part of the customer’s routine.

“If there’s a list of trends shaping 2019, e-comm grocery and delivery has got to be at the top of the list,” says Robin Sherk, vice-president, Canadian market at Kantar Consulting. While a handful of Canadian grocers have been involved in grocery e-commerce for years—Longo’s with Grocery Gateway, for instance— the purchase of Whole Foods Market by Amazon in 2017 upped the ante, setting the ball rolling for more grocers entering the e-commerce and delivery space for the first time in 2018.

In the year ahead, competition is expected to intensify. In recent weeks we have seen Instacart slashing its membership and delivery fees to be more competitive with the likes of Amazon, and in December Uber posted a job opening for “head of grocery product” in Toronto.

Industry watchers speculated on whether the company that disrupted foodservice delivery with Uber Eats is gearing up to make its mark on grocery delivery too?

“Now we’re realizing consumers want even greater flexibility,” says Sherk, noting, “it’s going to be the battle of the titans” when it comes to online grocery shopping in the coming year. “The differentiator will be what I call ‘the devil’s in the details,’ so the experience they provide,” she explains. “Execution is huge.” Details like whether the ice cream shows up melted or not are small but important things that can distinguish one retailer from another when it comes to delivery experience. “I think now is the time for disruption ... it’s the time to disrupt people’s routines,” says Sherk.

High hopes for edibles Canada grabbed headlines around the globe when it made recreational cannabis legal in October (only the second country in the world to do so, Uruguay got there first) and 2019 is expected to usher in the legalization of cannabis-containing edibles. How is this going to affect grocers? The specifics around regulation of edibles remain to be seen, but one thing is certain: grocers should all now be thinking about their strategies around cannabis and cannabis edibles.

“Will we see edibles in grocery stores in 2019? Highly unlikely, but I do think it’s going to happen eventually,” says Sylvain Charlebois, professor of food distribution and policy at Dalhousie University. A slew of companies are racing to develop cannabis edibles (and drinkables) from smaller brands like Neal Brothers Foods and Hill Street Beverage Company to larger players like Molson-Coors. Even Coca-Cola was said to be in talks with Aurora Cannabis on the potential of cannabis-infused beverages.

A recent Deloitte study found 51% of current and likely cannabis consumers

INTEREST IN VARIOUS EDIBLES (AMONG CURRENT/LIKELY CANNABIS CONSUMERS)

Baked goods/ cookies/brownıes etc.

35%

Chocolate Hard candies, lollipops, or gummies

28% 31%

Beverages 15%

Honey Popsicles and freezies Ice cream Potato chips Crackers/biscuits Olive oil

5%

13%

64%

43% 45%

25%

10%

9%

11%

37%

51%

24% 23% 22% 20% 19%

Have heard of product

Interested in using product SOURCE: 2018 CANNABIS REPORT, DELOITTE

48

December 2018 / January 2019 Canadian Grocer

were interested in trying cannabis-based baked goods, and Deloitte expects six out of 10 likely cannabis consumers will choose to consume edibles. Jennifer Lee, partner, consumer advisory & analytics and cannabis leader at Deloitte, says although there are many unknowns regarding how edibles will be sold, grocers still need to ask themselves some big questions. “They need to ask, do they want to be in this business?” she says. Grocers must decide if cannabis will be something their typical customer is looking for, and how selling it might affect their brand. “I think the question everybody needs to answer is: who is their customer? Does this fit within the category of customer? ... And, most importantly, would this help us achieve our overall value proposition?” she says.

“I think cannabis is going to be one of those supertrends where people overestimate the impact in the short term and underestimate the impact in the long term,” adds Kantar’s Sherk. A grocer can’t simply decide they’re not interested in the cannabis market and then ignore it, she says. They still need to think about the impact cannabis might have on their business whether they sell it or not. If consumers are using cannabis to relax and de-stress, for instance, “how are you helping them de-stress with your products and solutions?” Or if they’re using cannabis edibles to celebrate, it might present more competition for the beer and chips you’re selling in your store now. “So it’s about thinking through how is everyone using this, and then how do I either complement these products or compete against these products?” she says. “For that reason, I think this is something that matters to every single grocer and drugstore out there.”

A protein shake-up Canada’s Food Price Report 2019, a collaboration between the University of Guelph and Dalhousie University, identifies “the protein wars” as one of the biggest trends to affect the food business in 2019. As more Canadians seek to reduce their meat consumption for personal health and environmental reasons, plant-based proteins are surging in popularity. In fact, new and innovative plant-based foods—from vegan jerky to meatless burgers to dairy-free cheeses—have been showing up with greater frequency throughout 2018, and

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are predicted to grow throughout 2019.

As the price report notes, in 2018 “many local butchers closed their doors due to lack of demand, and this trend is expected to continue in 2019.” Animal protein suppliers will need to respond to these shifts, the authors explain. Many are already on it; for example, in the past few years, Maple Leaf Foods has acquired two plant-based protein firms and has invested in a cricket protein business, and the firm now positions itself as a “sustainable protein company.”

The price report also highlights the success of U.S.-based Beyond Meat—known for its meatless burger that looks and tastes like a beef burger and is now distributed to more than 25,000 restaurants worldwide (including A&W Canada)—as “a palpable example of this shake-up.”

Dalhousie’s Charlebois says many grocers are starting “to consider plant-based protein products to be the same thing as all the meat products we’ve been buying for decades,” often merchandising them alongside steaks and chickens, rather than giving them their own section.

Another survey from Dalhousie, released in October, revealed that 51% of respondents said they’re willing to reduce their meat consumption, with nearly 24% saying they’ll probably cut their meat consumption in the next six months and 8.5% saying they fully intend to reduce the amount of meat they eat during the period. Meanwhile,

Mintel’s Meat Alternatives Canada 2018 report showed a burgeoning interest in protein alternatives: 31% of consumers surveyed for the report said they would be interested in trying pea protein, 26% were interested in trying spirulina, and 12% were interested in trying insect protein (such as crickets).

“As demand for protein in foods outside of meat and other animal-based products grows, the spectrum of proteins that consumers are interested in, or at least willing to eat, appears to be broadening, with many citing interest in emerging ‘buzz-worthy’ proteins ranging from insects to algae,” said Joel Gregoire, Mintel’s associate director of food & drink, in a release.

A.I. everywhere No longer simply the stuff of sci-fi books and films, artificial intelligence (A.I.) is very real and it’s continuing to transform retail both on the front lines and behind the scenes. While there’s no shortage of news about deep-pocketed retailers rolling out flashy applications in the form of in-store robots or “just walk out” technology (more on that later), for most grocers, the experts believe A.I. will have a big impact in more “invisible” ways.

“There are a lot of shiny bauble technologies,” says Gary Saarenvirta, founder and CEO of Daisy Intelligence, a Toronto firm that works with retailers in the A.I. space. And the business case for some of

this expensive tech is uncertain, he says, adding that grocers with more “practical motivations” are going to use A.I. to focus on things like merchandising planning to allow them to be smarter around pricing and promotions. “That’s where we can augment the merchant’s expertise with some insights.”

Deloitte’s Lee agrees. “I think there’s a huge opportunity in the market, particularly in the merchant area, to use A.I. machine learning and external data sets more effectively in areas like forecasting and [in] areas such as basket analysis and customer journey,” she says, adding that while it’s great some organizations are starting to do this, it comes down to how much are they willing to invest and actually stay committed to A.I. “This is the key—to develop short-term wins, because the organization needs to see that this can happen while they build up a long-term strategy.”

One thing is for certain, A.I technology is advancing quickly and giants like Amazon and Walmart are investing heavily in it. TechCrunch recently reported that Walmart, in its latest move, is setting up an Intelligence Retail Lab to explore all the ways A.I. can be applied in its stores, from replenishing inventory to tracking the number of carts available for shoppers. Determining the best strategy for applying A.I. tech in their operations is something retailers will need to figure out quickly.

December 2018 / January 2019 Canadian Grocer

49

RETAIL TRENDS More cashier-less stores?

Future-proofing with experiential retail

Amazon sent the grocery industry into a tizzy at the beginning of 2018 when it unveiled its first Amazon Go, an 1,800-sq.-ft. store in Seattle that has no cashiers or checkout lanes but a whole lot of expensive tech.

As we enter 2019, it’s clear Amazon is serious about the format and its “just walk out” technology. There are now seven Amazon Go locations and in September, Bloomberg reported the company may be considering opening as many as 3,000 Amazon Go stores by 2021. And in December, the Wall Street Journal reported that Amazon was testing its cashier-less tech in a larger-format store, begging some analysts to question how long before the technology makes an appearance at its Whole Foods Market locations. While no details on expansion plans have been confirmed by the behemoth, Amazon Go’s “just walk out” technology, and cashier-less stores in general (Amazon’s the biggest, but by no means is it the only player in this space) will continue to be a topic to watch through 2019.

The continued rise of online shopping and click-and-collect services is changing how customers regard the grocery store visit, so grocers must now consider what each square foot of their store is doing to drive engagement and sales.

According to the recent BDO report Grocery Retail Trends in Canada 2018-19, experiential retail is identified as one tactic grocers can use to future-proof their business, transforming an otherwise humdrum shopping experience into something wholly unique.

The key, says BDO, is to extend the brand with the customer in mind and use technology to capture information that can be fed into CRM or data analytics programs to better determine future sales and assist in product development.

Some supermarkets are taking the experiential concept to extraordinary lengths.

In 2017, for example, the 150,000-sq.-ft.

Nations Experience opened in Toronto’s Stock Yard Village.

Nations Experience is billed as a “foodtainment” experience, complete with a 4,000-sq.-ft. indoor playground and

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arcade, a 300-seat food court, and aisles stuffed with hard-to-find products that adhere to its “where East meets West” philosophy.

Italian market hall concept Eataly, which is reported to be opening its first Canadian location in Toronto’s trendy Yorkville neighbourhood next year, has achieved success with its “grocerant” concept and unique features such as a “vegetable butcher.” Sales per square foot for Eataly’s New York location have been pegged at US$1,700, an unheard of number for grocery retail.

But grocers don’t need to invest in a ball pit or arcade games to bolster the in-store experience—the BDO report suggests even smaller events such as tastings or cooking classes can directly impact sales. According to a report from EventTrack, 85% of consumers are more inclined to make a purchase after participating in an event.

The last straw for plastic?

Pressure is mounting on all of us to kick our plastic habit, particularly single-use versions of the ubiquitous material.

In October, the European Parliament voted to ban single-use plastics by 2021.

The sweeping move was made to help curb ocean plastic pollution; about 150,000 tons of plastic each year gets dumped in European waters alone and this is just a fraction of the global problem, according to EU research. The ban targets common items such as plastic cutlery, plates, straws and drink stirrers.

One month later, the Canadian government announced it is pushing forward with a zero-plastic waste strategy with an action plan still to come.

Meanwhile, businesses and municipalities are implementing their own policies around single-use plastics. Over the past year, Vancouver has banned straws, Prince Edward Island has moved to ban single-use plastic bags and IKEA Canada and A&W have also taken a stand against single-use plastic. As more consumers get behind the cause, we can expect the issue will be a big one in 2019 and businesses will need to respond.

“I think this will become a massive issue and I do believe it’s an initiative retailers and suppliers should work together on,” said Walmart Canada CEO Lee Tappenden at Canadian Grocer’s recent Thought Leadership conference. “It’s a very important issue to address.” CG

A SPECIAL

THANK YOU

to our 2018 Sponsors It is with your support that we are able to bring retailers and manufacturers together to gain valuable insights from thought leaders in our industry

PLATINUM

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Thought Leadership CEO CONFERENCE

INDUSTRY PARTNERS

Canadian Grocer’s 2018 Thought Leadership CEO Conference was an afternoon filled with thought-provoking insights from some of the industry’s biggest names. The November event kicked off with “Spoiler Alert: Your Consumer is Cheating on You,” a presentation from Nielsen’s VP of consumer insights Carman Allison on how grocers can embrace consumer infidelity to identify new growth opportunities. Tom Barlow, president and CEO of The Canadian Federation of Independent Grocers, then conducted a oneon-one interview with Frank Ho, senior vice-president of Nations Fresh Foods, exploring topics such as Nations’ “foodtainment” strategy and the importance of creating an exciting experience in grocery.

Next up was Tracey Koller and Peter Moustakerski of News Marketing Canada; the team delivered a compelling talk on data and the value of a “connected ecosystem.”

The highlight of the afternoon was the CEO leadership panel. Moderated by Tony Chapman, the panel included Walmart Canada’s president & CEO Lee Tappenden, Empire/Sobeys’ president & CEO Michael Medline, Kruger Products’ CEO Dino Bianco and Hain-Celestial Canada’s CEO Beena Goldenberg. Panellists discussed a range of topics, with the theme of embracing change being prevalent throughout the hour-long discussion.

JOHN GOLDSTEIN PHOTOGRAPHY

SHARING BIG IDEAS AT THOUGHT LEADERSHIP 2018

Thought Leadership CEO CONFERENCE PRESENTED BY

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53

AISLES

Products, store ops, customers, trends

BREAKFAST FOODS

Healthy, flavourful and convenient breakfast foods serve up opportunities for grocers

By Carolyn Cooper

54

N

ot everyone considers breakfast to be the most important meal of the day. But ask anyone to name their favourite comfort foods, and breakfast items are likely on the list. After all, traditional breakfast choices such as oatmeal, bacon and eggs, or pancakes with maple syrup are filling and comforting, while new favourites like egg wraps make for the perfect portable meal. As eating occasions for breakfast items continue to grow, grocers can make the

December 2018 / January 2019 Canadian Grocer

most of breakfast food sales by meeting consumer demand for healthy, flavourful and convenient alternatives.

In the May 2018 Insights article “Canadians Favour Healthy Breakfasts,” Nielsen discovered that although only 18% of consumers skip breakfast, 65% are “finding it challenging to eat right.” And the firm’s Panelviews survey (April 2017) of almost 6,000 Canadians revealed consumers want breakfast foods that are: flavourful (53%); filling (52%); high in protein (50%); high in fibre (47%);

GETTYIMAGES/LAURIPATTERSON

Good morning, sunshine

AISLES low in sugar (40%); made with whole grains (33%); low in sodium (31%); low in fat (28%); made with healthy fats like avocado, coconut, nuts or seeds (26%); and can be eaten any time of day, such as pancakes or eggs (22%). At the same time, Nielsen says 54% of Canadians spend just “five minutes or less on breakfast preparation,” meaning they’re more likely to look for grab-and-go items such as fruit and cereal bars.

“Consumers are looking for satiating breakfast options that include protein and fibre,” agrees packaged foods specialist Birgit Blain, principal at Toronto’s Birgit Blain & Associates. “Convenience— speed and ease of preparation—is a main driver, together with taste, value, portability, nutrition and food sensitivities and allergies.”

As the boundaries between meal occasions continue to blend, breakfast items are also coming out on top as a favourite for lunch, dinner and all-day snacking.

Ipsos Marketing found that 42% of eating occasions for breakfast foods are now consumed at other times of the day.

Younger Canadians are driving this interest in all-day breakfast: Ipsos notes millennials are the demographic most often choosing traditional breakfast foods like toast, bacon and eggs as a cheap and cheerful, family-friendly dinner.

Not surprisingly, bacon and eggs top Nielsen’s list of growing breakfast staples. According to Neilsen MarketTrack, dollar sales of both proteins jumped 5% in the 52 weeks ending Mar. 31, 2018, followed by increases in fruit and hot cereals (4%), breakfast/cereal bars (3%), frozen breakfasts (2%), and packaged sausages (1%). Meanwhile, sales of packaged bread fell 2%, and both yogurt and pancake and waffle mix fell 1%.

Manufacturers are taking note and developing a variety of convenient, protein-packed breakfast foods. Burnbrae Farms’ new Egg Bakes! Egg Patties and Egg White Patties, for instance, make for easy microwaved breakfast sandwiches in just 75 seconds, offering six grams of protein per patty. And the Lyn, Ont.based company’s new Egg Bakes! Crustless Quiche provides between nine and 13-grams of protein per quiche, available in five flavours including Cheddar, Mushroom and Bacon, as well as Spinach, Ricotta and Carmelized Onion.

Mann Packing Company also recently expanded its popular Nourish Bowls line

to include Nourish Bowls Breakfast. The new packs allow consumers to create a home-cooked breakfast in just four minutes by combining eggs with the mix of pre-cut vegetables and toppings inspired by global flavours.

“The breakfast items consumers most identify as healthy include fruits, vegetables, milk, oatmeal, eggs and yogurt,” says Loree Dowse, director of creative marketing for Mann Packing, who notes that the new bowls are low-calorie and high-protein. They’re available in two varieties: Denver Scramble (kale, sweet potato, cauliflower and broccoli, with a bell pepper sauce with diced ham and onion and a cheddar cheese topping), and Fiesta Scramble (kale, cauliflower, kohlrabi and butternut squash, with a pico de gallo salsa with chicken chorizo and a Mexican cheese blend topping).

At The Big Carrot Community Market in Toronto, marketing manager Sarah Dobec says when it comes to breakfast, “our customer base is motivated by healthy choices, so we see an interest in fresh, organic ingredients.” As for traditional proteins such as eggs and bacon, she says, “we have seen an increased interest in organic options as well as meat raised humanely.”

Dobec also notes that cereals and breads are being adapted to meet evolving consumer demands, with an increase in paleo, gluten-free and high-protein offerings. “Muffins are still a very popular breakfast item, but we now offer more gluten-free, grain-free, and paleo options.” Dobec also sees growth potential in portable items like mason jar breakfasts featuring layers of yogurt, fresh fruit, granola, hemp seeds, and warm bone broth beverages “that [are] sustaining throughout the morning.”

According to Fona International’s Breakfast Trends: Health on Top, released in April 2018, other convenient breakfast foods with momentum include overnight oats with nutritious ingredients like chia; toast spreads featuring purées of seasonal vegetables and herbs; and morning beverages with functional ingredients like turmeric and matcha.

Fru-V Smoothie Kits from Stouffville, Ont.-based Health Addict are another example of breakfast items focused on ease of use and health benefits. Owner

Carrie Darmaga sees convenience and nutrition as the top two demands when it comes to breakfast. “Unfortunately, many [people] will put convenience before nutrition, as there are few truly healthy options for on the go,” she says.

Darmaga created Fru-V Smoothies as a fast, whole food alternative “loaded with veggies and superfood ingredients.”

The blender-ready fruit and vegetable smoothie kits include three to four grams of protein per serving, and are free of refined sugar, artificial sweeteners, colours and flavours, making them ideal for busy families. There are currently two varieties—Berry-Veggie with Acai Purée, Flax, Goji Berries and Hemp Protein; and Tropical-Veggie with Flax, Spirulina and Hemp Protein—and Darmaga says two new flavours, chocolate and carrot-­ ginger, are in the works.

Health Addict does both in-store demonstrations and sampling, something that helps shoppers connect with innovative products that are redefining the breakfast category. Nielsen also recommends boosting sales of breakfast items by “communicating health characteristics to consumers via shelf talkers or point-ofpurchase material about desirable attributes like high in protein and fibre.”

To “lure shoppers away from visiting quick-service restaurants for their daily breakfast,” Blain suggests that grocers “promote the wide variety of options to ‘start your day’ in all departments— from fresh to frozen to centre store.

Cross-merchandise and cross-promote fresh and dry grocery pairings.”

The Big Carrot offers a juice bar to catch busy morning shoppers, which Dobec says is “busy in the morning making hearty smoothies,” and its Beach location offers its own grab-and-go breakfast wraps “often paired with an organic, fair trade, bird-friendly coffee.”

Breakfast items “are in a beautiful display so that customers can easily add to their order,” says Dobec. “Our customers are on the go, so we are targeting the busy but healthy commuter.”

VEGAN FOODS

PLANT PERFECT From cashew cheese to vegan sausage, plant-based foods are pleasing vegans and meat-eaters alike

By Rosalind Stefanac LONG THE PREFERRED fare of animal-rights activists, vegan foods are now catching on in mainstream Canadian diets. Not only are 6.4 million Canadians already following a diet that partially or fully restricts meat, the majority of those adhering to a vegan diet (which means avoiding all animal-based foods, including dairy and eggs) are under the age of 38, according to a 2018 study out of Dalhousie University in Halifax. Another survey conducted by popular takeout food delivery app Just Eat showed a whopping 987% increase in people seeking meat-free options last year.

All this points to vegan and plantbased foods gaining big momentum.

“We’re moving beyond vegetarians to everyday consumers who are expanding their diets with plant-based options,” says Leslie Ewing, who oversees PlantBased Foods of Canada, an association that launched this year. “This increased interest presents a great opportunity for both manufacturers and retailers.”

Besides the desire for healthier lifestyles and environmental concerns

56

around meat production prompting vegan diets, Ewing says products in this category are now more accessible through mainstream retailers. In fact, earlier this year Loblaw CEO Galen G. Weston announced his company would launch 30 vegan products under its President’s Choice label in 2019.

Ewing points to innovative taste profiles that are winning over consumers too. “Taste is a key driver of growth,” she says. Whether it’s smoked and flavoured tofu, nut cheeses, vegan sausages, faux bacon grease or plant-based desserts, tasty new offerings are enticing even meat and dairy lovers to try them.

“Eighteen months ago, no one could find a good nut cheese out there and now several companies have jumped in to fill that void with success,” says grocer Matt Lurie, president of Ontario-based Organic Garage, a store that carries a wide array of vegan products. “I’m not a cheese connoisseur, but they’re coming out with brie and complex cheddar options that are a dead mimic for [dairy] cheese and it’s pretty impressive.”

December 2018 / January 2019 Canadian Grocer

Even traditional meat and dairy eaters are opting for nut-based cheeses, says Lynda Turner, founder of Fauxmagerie Zengarry, a vegan cheese maker based in Alexandria, Ont. The company’s seventh and latest flavour of cashew-based cheese—an aged cheddar fermented with craft beer—was inspired by the desire to create a pub-style cheese that would appeal to a more masculine audience.

“When you tell a male this is our aleaged cheddar, that’s the first one they’ll try,” she says. “Plus, you can put any of our cheeses on a regular charcuterie board because the taste profile is so rich.”

John Bonnell, co-founder of Toronto-based Wholly Veggie, says his customers aren’t all self-identified vegetarians or vegans either. “They’re just looking to incorporate more plants into their diets because they are concerned about what goes into their bodies,” he says. In the last year and a half, his company has launched 11 vegetarian and vegan products, ranging from fully cooked veggie patties and vegan “bites” to cauliflower-based pizza crusts. “But this is still a new category and we have to help consumers navigate,” he adds.

This navigation entails plenty of in-store demos and sampling to get people trying these products, says Bonnell.

“It also means pulling products out of the freezers at the back of the store and closer to the front for easy access,” he says.

“Remember that lots of people are looking for [plant-based] meal alternatives who aren’t traditional vegan shoppers.”

Turner suggests grocers try putting vegan products in various sections of their stores to determine where they’ll sell best. “Vegan cheese could be in the cheese department, for example, but I’ve also seen grocers creating special veggie sections where all these products can be found,” she says. Regardless of where you put them, signage is key. “It’s all about educating consumers and putting [up] signs that call attention to the fact these are dairy-free products,” says Turner.

At The Big Carrot Community Market in Toronto, vegan options are incorporated into daily fresh meal selections too.

“In our kitchen and ‘grab and go’ section where we’re serving fresh food, there are always vegan options,” says marketing manager Sarah Dobec. “More and more people are trying a vegan diet and want something convenient.” CG

SHUTTERSTOCK/PIKOSO.KZ

AISLES

AISLES

WHAT’S IN THE FREEZER?

As we enter the icy winter months, we turn our attention to the coldest section of the grocery store: the freezer. From frozen fish and veggies to pizza snacks, desserts and more, dollar sales in the frozen food category as a whole have risen by 3% over the past year reaching nearly $5.9 billion. So what’s hot and what’s not so hot in the frozen aisle? This recent data from Nielsen shows how the various frozen categories have been performing.

Frozen foods - 52 weeks, ending October 13, 2018 $ Sales (000s)

$ Vol % Chg

Units (000s)

5,864,919,230

3

1,239,637,104.5

2

108,688,389.0

0

15,920,214.9

-3

1. BREAKFAST - FROZEN

144,973,756.0

7

44,867,030.4

4

CONFECTIONS - FROZEN

435,757,364.0

4

92,158,924.6

4

1,723,314,486.0

3

331,656,637.3

1

88,405,850.0

7

22,153,933.8

2

2,728,430.0

8

468,366.6

6

FROZEN FOOD - TOTAL BAKED DESSERTS - FROZEN

2. DINNERS & ENTREES - FROZEN DOUGH & PASTRY - FROZEN FISH & CHIPS - FROZEN FRUIT - FROZEN

325,011,289.0

0

61,171,143.2

5

3. FRUIT BEVERAGES - FROZEN

73,519,973.0

-8

76,852,671.6

-9

MEAT PATTIES - FROZEN

230,489,006.0

-1

19,264,742.2

-5

PIZZA & SUBS - FROZEN

496,892,640.0

-1

113,280,781.4

1

PIZZA SNACKS - FROZEN

113,613,048.0

8

29,230,428.2

14

POTATOES - FROZEN

259,277,391.0

5

87,425,228.9

4

SEAFOOD - FROZEN

858,639,719.0

2

94,753,331.3

0

VEGETABLES - FROZEN 4. ICE CREAM & RELATED PRODUCTS 4. YOGURT - FROZEN

1 It’s the most important (frozen) meal

SHUTTERSTOCK/AIMY27FEB

Units Vol % Chg

of the day! Frozen breakfast products are experiencing a 7% increase in dollar sales, reaching nearly $145 million in the latest 52 weeks ending Oct. 13.

2 Frozen dinners and entrees are still, by

far, the biggest sellers in the frozen food category with an impressive $1.7 billion in dollar sales—a 3% increase over last year.

322,120,468.0

4

105,166,750.4

3

494,656,310.0

10

111,527,593.6

9

40,480,831.0

-8

8,590,142.6

-11

3 It seems the popularity of frozen fruit drinks is cooling off. The category saw an 8% decrease in dollar sales to $73.5 million in the past year, with a 9% decrease in unit sales.

4 While ice cream and related products are up a whopping 10% in dollar sales, frozen yogurt is getting the cold shoulder from consumers with an 8% decrease in dollar sales and 11% decrease in unit sales.

SOURCE: NIELSEN, NATIONAL, ALL CHANNELS, ALL SALES, EXCLUDING N.L.

AISLES

Bottom’s up!

Alcohol-free beer, wine and spirits are booming—and not just for “dry January.” Partly due to consumers’ growing interest in health, and partly because (as research shows) millennials are drinking less alcohol, Global Market Insights projects the non-alcoholic beer and wine market to grow globally by 7.6% to surpass US$25 billion by 2024. Even more proof of the trend: all the innovation, from hip non-alcoholic beer imports to upscale booze-free spirits.

CEDER’S Calling itself an “alt-gin,” Ceder’s is a distilled nonalcoholic gin made with South African botanicals from the country’s Cederberg Mountains and Swedish water.

Already a big hit in the U.K. after launching there several months ago, Ceder’s isn’t available in Canada yet—but its makers say they hope to have their premium alcoholfree gin available on North American shelves soon.

ST. REGIS Nosecco by St. Regis features all the fruity and floral aromas associated with a traditional Prosecco, but with less than 0.5% alcohol. Produced in Spain and owned/ distributed by Quebec’s I-D Foods, the St. Regis Nosecco is a dealcoholized sparkling wine that can appeal to consumers seeking a predinner aperitif, a dessert accom­ paniment, or a fun alcoholfree way to toast a special occasion.

58

SEEDLIP Since launching in 2015 as one of the world’s first high-end non-alcoholic spirit brands, U.K.-based Seedlip has been getting glowing media reviews the world over for its first two varieties: Garden 108 (a herbal spirit) and Spice 94 (described as “aromatic”). Now, Seedlip has launched a third spirit called Grove 42, which it describes as “an adult, citrus blend of copper-pot distillates.”

Toronto’s own

BAVARIA Dutch family brewer Bavaria launched the non-alcoholic version of its beer in Canada this year in two varieties: Bavaria 0.0% Original and Bavaria 0.0% Wheat.

According to the company, Bavaria’s unique way of brewing its alcohol-free beer guarantees that no alcohol is ever created in the brewing process (as opposed to removing the alcohol after), which the brewer says results in a “full-bodied flavour.”

December 2018 / January 2019 Canadian Grocer

HILL STREET BEVERAGE COMPANY Featuring trendy, fun label designs that rival any of the hippest boozy wines on the market, Toronto-based Hill Street Beverage Company offers Merlot, Chardonnay, Sauvignon Blanc and Brut Blanc sparkling wine as part of its Vin(Zero) line of alcohol-free wines. Hill Street also has a second line of non-alcoholic wines called Vintense, as well as two alcohol-free craft beers: Hill Street Craft Brewed Lager and Designated Draft.

FRESH

Potato trends

Hot potato New varieties and strategic marketing are helping the humble potato reassert itself

By Danny Kucharsky

SHUTTERSTOCK/ULRICH22

HIT HARD BY the low-carbohydrate diet craze, the potato industry is striking back with a number of new varieties, products with health claims, and spuds that are more convenient than ever for time-strapped consumers.

Developing new potato varieties and touting potatoes’ health benefits are “how we move the category forward,” says Kendra Mills, marketing director of the PEI Potato Board. “It’s really unfortunate that something like a vegetable can take the brunt” of the impact from a lowcarb diet trend, she says, adding, however, “We’re finally coming back around.”

While potatoes “get lumped into the starch category, eating a potato is very different nutritionally than eating a piece of white bread,” Mills says, noting that a fist-sized potato contains only about 120 calories, has more potassium than a banana and contains no gluten, sodium or cholesterol.

Mills adds that while potatoes in Canada are largely marketed by type—such

as russet or white—the popular European practice of marketing potatoes by variety is starting to catch on.

Since 2007, for example, Mid Isle Farms has had North American rights from U.K. supplier Greenvale for the Vales Sovereign variety, which it sells under the Rustic Comfort brand. The all-purpose variety that features creamy flesh and “pink kisses” on the eyes was named a fresh produce variety of the year by U.K. grocer Tesco. “We’re very, very pleased with this variety,” says Jennifer Harris, director of marketing and sales at Mid Isle Farms in Albany, P.E.I. Harris also touts Mid Isle’s yellow-­ fleshed Yukon Russet, “an ideal all-­ purpose potato” sold at Sobeys and Metro that she says is delicious any way it’s prepared. “The more all-purpose, the better,” she says.

At the other end of the spectrum is EarthFresh’s Best For program—consisting of potatoes (typically red, yellow, russet and white) that are considered best

for baking, roasting, mashing or boiling.

Potatoes “all have different cooking attributes,” says Stephanie Cutaia, marketing director at EarthFresh Foods in Burlington, Ont. “What we’ve done is make it easy for the consumer who’s going in saying, ‘What kind of potato do I need?’”

EarthFresh was first to market with its Carisma lower glycemic index potatoes (lower in carbohydrates), which it launched in 2016. “We were the first food item in Canada marketed as having a lower glycemic response, which was exciting,” Cutaia says. EarthFresh’s lower glycemic index claim was proven on blood tests conducted on patients with diabetes. The yellow potato was listed at Sobeys, Metro, Longo’s, Whole Foods Market and Walmart. While EarthFresh was unable to get enough availability to sell the potato in 2018, it is hoping to bring it back next year.

EarthFresh recently also launched the NutriSpud Vitality brand of high anti-oxidant potatoes, a mix of purple, red and yellow potatoes. Its packaging pledges to “energize your life.”

“People are looking constantly for something new,” says Cutaia, citing Mintel data that finds 45% of Canadians are interested in trying foods with health-boosting claims. “We truly try to hone in on what people are looking for.”

Harris predicts cleaner potatoes that don’t need to be peeled (“just run them under the water and they’re good to go”) will become more prevalent. “They’re cleaner and faster for the consumer to use,” she says, noting Mid Isle recently installed a polisher to clean its potatoes.

Frank Yunace, operations manager at Pete’s Frootique & Fine Foods in Halifax, says small potatoes like creamers are popular with shoppers because they’re convenient and cook quickly. Baby new potatoes “are great because they’re easy to roast,” but russets are the No. 1 sellers.

Smaller-sized bags—such as two or three pounds—are also a hit.

Fresh potatoes make up “the fastest-­ growing side dish right now,” Cutaia says. “Our mandate is to shout out the goodness of potatoes,” she adds, so that the next big diet fad doesn’t hurt the market again. CG

December 2018 / January 2019 Canadian Grocer

59

CHECKING OUT

A FOOD SMART CITY

Guelph is ideally positioned to create Canada’s first circular food economy THE CITY OF GUELPH, Ont. and its surrounding county of Wellington are undertaking a major initiative to transform the area into Canada’s first circular food economy.

The goal? To achieve a 50% increase in access to affordable, nutritious food; 50 new circular food business and collaboration opportunities; and a 50% increase in revenues by reducing or transforming food waste. As the city’s website explains, the aim is to create “a food system where there’s no such thing as waste, every citizen has access to healthy food, and new businesses are created as a result.”

Under the headline of “Our Food Future,” the region is putting its vision at the heart of the joint proposal for Infrastructure Canada’s Smart Cities Challenge, and was selected to be awarded $250,000 to further develop its bid with a chance to win a $10-million prize next March. To clarify their bid and define the Our Food Future vision, county and city food leaders have engaged with members of their communities’ agri-food, business, academic and social sectors, as

60

well as members of the public, in order to identify challenges and opportunities.

If any region is set up for success in this initiative, it’s Guelph-Wellington.

For years, Guelph has been quietly establishing itself as a Canadian centre for agriculture, food research and innovation. According to the City of Guelph website, Guelph-Wellington is home to more than 1,600 food businesses and entrepreneurs and more than 40 research institutes and centres related to agri-food. The region has representation across the entire food system value chain, from agricultural production and research through to commercialization, food and beverage manufacturing and retail markets, according to Barbara Maly, manager, economic development for the City of Guelph.

“Guelph-Wellington is recognized as a global leader in solving food problems,” said Derrick Thomson, chief administrative officer, City of Guelph, in a release.

“We are excited to embark on this new stage of innovation together with our

December 2018 / January 2019 Canadian Grocer

community. Simply put, there’s no better place to re-invent the food system than Guelph-Wellington: agri-food innovation is in the community DNA.” Most Canadians are aware of the renowned food and agriculture programs at the University of Guelph, but may not be familiar with specific programs at the university like Accelerator Guelph, which is focused on commercializing discoveries from academic research specializing in food and agriculture.

Then there’s the university’s Arrell Food Institute, which has the lofty goal of “transforming global food systems and elevating Canada’s place within the global food economy” through its worldclass food research and education.

The city is also home to the non-profit Ontario Agri-Food Technologies, providing services to ag businesses including funding for research, export and international sales opportunities; as well as Provision Coalition, an organization that provides tools, assessments and services to help companies reduce food waste and decrease their environmental impact.

Some of the food-related government agencies with offices in Guelph include the Canadian Food Inspection Agency, Agriculture and Agri-food Canada, and the Ontario Ministry of Food and Agriculture. And on the manufacturing side, the city is home to countless notable facilities including a beef processing facility operated by Cargill, two Maple Leaf Foods facilities, a dairy product processing facility operated by Gay Lea Foods, and many, many more.

With all this momentum in the food research, innovation and production/manufacturing space behind it, Guelph-Wellington seems perfectly positioned to create what it is calling “Canada’s first food smart community”—and the impact of this work is sure to go well beyond just winning the big prize in Infrastructure Canada’s challenge. CG

George Condon is Canadian Grocer’s consulting editor.

He’s based in Toronto. condug@sympatico.ca

IMAGE: SHUTTERSTOCK/MAX SKY; ILLUSTRATION: SHUTTERSTOCK/KU_SURIURI

George Condon

MAKING THE

RIGHT MOVES Kraft Heinz Canada’s bigbet investments will help grocers succeed in 2019

FROM HUGS TO HOCKEY: HOW KRAFT HEINZ HELPS CANADIANS

WHAT’S COOKING? A sneak peak at new products

BUILD BASKET SIZE

Introducing Kraft Heinz Canada President Nina Barton

Shopper solutions that work Q & A with VP of Sales, Peter Hall KRAFT HEINZ CANADA’S PETER HALL, VP OF SALES AND NINA BARTON, PRESIDENT

™

A [SERIOUSLY] rich, creamy & smooth mayonnaise made using only the best quality ingredients

800mL Regular Glass Jar

800mL Light Glass Jar

675mL Regular Squeeze Bottle

Delicious, rich and creamy taste that could only come from Heinz Made with high quality ingredients like 100% Canadian free run eggs No artificial flavours, colours or preservatives* Premium packaging: egg shaped glass jar *Disclaimer: As per mayonnaise standards in Canada

Contents K5 Partnership and Growth

Kraft Heinz President Nina Barton and VP of Sales Peter Hall share their plans for an exciting year ahead

K6 A Fresh Approach

VP of Sales Peter Hall talks about his plans for 2019 and new opportunities to drive business

K9 Growing Together

With leading-edge innovation and shopper solutions, Kraft Heinz Canada is invested in retailers' success

K5

K13 Community Commitment

Kraft Heinz Canada's CSR initiatives leave their mark on communities across Canada

K16 A Taste of What's to Come Exciting new products for 2019

K19 Up Close with Dana Somerville

Kraft Heinz CMO talks plans and priorities for 2019

K13

K9 K16

Special promotional feature in Canadian Grocer–December 2018/january 2019

K3

TM/MD

Show your mouth a good time with CRAVE The #1 New Brand in Frozen Meals.

CRAVE is the #1 New Frozen Meals Brand

On average, CRAVE has the top 5 selling SKUs in Single Serve Frozen Dinners1 with its 5 SKUs in 2018.

Growing the Frozen Category

Source of volume showcases CRAVE has the ability to trade consumers up and grow the category2.

CRAVE is ridiculously good and is made with no artificial colours or flavours and in a filling portion size!

INTRoduCINg FIVE NEw VARIETIES IN 2019 New dinners for 2019

New Breakfasts for 2019

• Smokey BBQ Angus Beef • Buffalo Chicken Macaroni & Cheese • Pulled Chicken Burrito Bowl

• Chorizo Egg Scramble with Goat Cheese • Bacon & Egg Scramble with Cheddar Cheese

2

1 Source: Nielsen MarketTrack Total Sales YTD Source: Nielsen BASES Concept/Volumetric Test, Crave, March 2017

Letter Dear Colleagues, Welcome to 2019, a year full of opportunities for you to partner and grow with Kraft Heinz! We’re excited to showcase our plans for the year ahead including new offerings, expanded portfolios of growing categories, continued investment in community-based scale marketing programs and increased focus on iconic brands that Canadians know and love.

One of our continued areas of focus for the year ahead is the harnessing and sharing of insights. As in many markets around the globe, the Canadian grocery industry is shifting and adapting to the new ways consumers are shopping, including an increased focus on fresh and meeting the demand for online convenience. As leaders in the industry, Kraft Heinz has the expertise, tools and strategic capability to help navigate this evolving retail landscape and drive category growth. Our Insights and Shopper Marketing teams are dedicated to analyzing and understanding all levels of shopper behaviour and developing the best programs to increase basket size in any store or region. We encourage you to leverage our expertise for mutually beneficial growth.

In addition, we continue to invest in our iconic brands and look for ways to deepen our relationships with Canadian consumers and bring excitement to the shelves of centre store. Whether through new marketing campaigns or well-established programs such as Kraft Hockeyville and Project Play, you can count on Kraft Heinz to bring consumers to grocery store aisles for brands they know and trust.

With change comes opportunity and for the year ahead and beyond Kraft Heinz is working to provide our retail partners with the best products, innovations and professional expertise to continue to build mutually beneficial partnerships. We look forward to an exciting year of opportunity and growth for both our businesses.

Sincerely,

Nina Barton President Kraft Heinz Canada

Peter Hall Vice President of Sales Kraft Heinz Canada

Special promotional feature in Canadian Grocer–December 2018/january 2019

K5

A Fresh approach Peter Hall, who joined Kraft Heinz Canada as VP of Sales in early 2018, talks about his plans for the year ahead and new opportunities to drive grocers’ businesses

In your previous role as sales director in the U.K., you helped accelerate growth in a challenging market. What challenges are unique to the Canadian market?

Canada is a rapidly evolving, multifaceted market and today, we are facing an increasingly demanding retail environment. Consumers expect more than ever before.

They’re looking for a one-stop shop, tailored to their needs and available at their convenience.

With that comes the challenge of online growth, the disruption of Amazon, the growth of discount and the increased frequency of customer trips per month. We’re now looking at a food for today, food for tonight culture, which puts cost pressures on both suppliers and retailers.

Conversely, what excites you most about the Canadian market?

All of the above. This gives us an opportunity to learn, fail fast, adapt to best practices and continually raise the bar. The brands that meet customer and consumer demands the quickest will win and we’re excited about that challenge.

What big successes has Kraft Heinz seen since the two companies merged in 2015?

Springboard, our platform dedicated to nurturing and scaling disruptive brands within the food and beverage space has been a great success! This program, which is run out of the U.S., grants access to resources like R&D, sales strategies and data to startups that otherwise wouldn’t have access to these tools or team of entrepreneurs. We also

K6

recently announced that we’re putting $100M forward to launch a venture capital fund that will exclusively focus on investing in emerging tech in the food industry. Tech continues to disrupt the food industry. This fund will focus on startups in supply chain, logistics and e-commerce.

What has the merger meant for grocery retailers?

We’ve certainly had our challenges and I’ll be honest, we haven’t always been at our best. But over the past 12 months we’ve seen great progress. We’re open for business and our retail partners have noticed. We’re reacting and adapting to meet our partners’ needs. This includes scaling innovation and introducing new categories and formats to the market.

We’ve also made considerable efforts to better understand the shopper and consumer, so we can further drive growth. For example, we heard from families that they wanted to feel good about what they were serving their kids. That’s why we introduced our No, No, No KD. Kraft Dinner with no artificial flavours, no artificial colours and no preservatives.

What is your retail strategy heading into 2019?

Right product, right store, right space, at the right price.

How has Kraft Heinz invested to help drive retailers’ businesses? What are the “big bets”?

We’ve conducted substantial research across our four core categories: grocery, beverage, cheese and foodservice.

This research gives us a better understanding of the shopper and their behaviours, how they shop, when they shop,

Special promotional feature in Canadian Grocer–December 2018/january 2019

and why they shop. Our insights team is engaging directly with our retail partners to share this understanding on an ongoing basis, allowing us to maximize in-store sales. This is a core focus of mine as we move into 2019 and represents an opportunity with retailers across the country.

We have also invested in our online expertise. We have the advantage of scale and I am excited about the insight and value we can bring in this area to our partners as their online business continues to evolve and grow.

What consumer trends are influencing and shaping your innovation plans?

Clean labels and fresh, organic products with fewer ingredients.

Much has been written about declining consumer interest in the centre aisle. How is Kraft Heinz helping grocers bring excitement back to the centre aisle?

The centre of the store has grown over the last couple of years – this is still a core segment of the food and beverage industry. We saw our centre aisle products like salad dressings, pasta sauce, desserts, and pre-packaged meals all grow this past year alone.

There’s a discussion needed around how we attract shoppers to our aisles of our stores, how we engage them once they’re at the shelf and how do we ensure that all their needs are being met. I’m talking about everyday value, display, price and education on where and how to use products and formats.

What’s in store on the marketing front?

We’re focused on our core business: this means ketchup, peanut butter, Kraft Dinner, salad dressings, Maxwell House Coffee and Philadelphia Cream Cheese.

What opportunities do you see for your brands in grocery e-commerce, and how will you help grocers increase online shopping baskets?

I’ve had the good fortune to work in one of the most developed online retail environments in the world. This has given me the opportunity to win and fail in a number of different ways through the growth of online business.

Our brands play an important role online just as they do in physical stores. And whilst the fundamentals of the business are slightly different, the opportunity to drive loyalty and spend, by having the right products at the right price and right place still exists.

At Kraft Heinz, we have a global centre of excellence for online retail. An advantage for us in Canada is that our incoming President, Nina Barton, has been heading up that function for the past 14 months. We’re excited about leveraging her and the capabilities of her team to support our retailers on the opportunities of online growth.

What are the keys to a successful retail partnership in today’s changing landscape?

I’m not sure they’ve changed much over my working life.

It’s about understanding our partners, their needs and their shoppers. Delivering value at every level and in every action. It’s about putting the shopper at the heart of every decision we make, being open to change, fast and flexible to respond.

What makes Kraft Heinz different? What do you consider a competitive advantage?

I’m in a lucky position to be a VP of Sales with some of the best brands in Canada, this comes with the ability to engage with shoppers in a way that only a few brands can in the marketplace. I’ve also been incredibly fortunate to inherit an in-house field sales team that covers more than 3,500 stores. Day in and day out, this team helps to drive speed, action and focus within the retail space.

Special promotional feature in Canadian Grocer–December 2018/january 2019

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W

NE Find it next to Philly in the dairy case!

*Visuals Subject to change

Cream Cheese Frosting made with

Philadelphia Cream Cheese PHILLY GIVES CONSUMERS WHAT THEY WANT! • Cream Cheese is the #1 flavour in shelf stable frosting, but is not made with real cream cheese1 • Responds to consumer need for fresh, homemade and time saving

CONSUMERS LOVE PHILLY! • Brand Equity is 10x stronger than next leading competitor2 • 71% of consumers agree that frosting is a perfect fit for Philly!3.

Made with REAL milk and cream

Nielsen Strategic Planner, Icing Mixes, L52W $ Vol, period ending July 22, 2017 2Cream Cheese BVC Equity, January 2018 3Philadelphia Brand Stretch Study, August 2017

1

GroWing Together With a focus on leading-edge innovation and shopper solutions, Kraft Heinz Canada is invested in retailers’ success

I

n the business world, success is often the result of great partnerships. That’s especially true in the rapidly changing grocery industry, where CPG manufacturers and retailers must work together to meet shoppers’ needs and drive mutual growth.

Kraft Heinz has a proud history of collaboration with Canadian grocers, and is focused on continuing to help its retail partners build basket size and profitability in 2019 and beyond. By focusing on customer-inspired innovation and smart shopper solutions, Kraft Heinz will help place grocers in the best position for success.

Dialing Up Innovation

Kraft Heinz has a wide portfolio of powerful and iconic brands, and continues to keep its brands moving forward and in step with consumers. “Innovation for our categories, customers and company is paramount to mutual long-term and sustainable growth,” says Jeremy Attridge, Director, Customer Insights & Category Management. “We are committed and focused throughout our entire organization to ensure that we launch and execute the right products to drive incremental category growth.”

For Kraft Heinz, it’s crucial to understand consumer needs, and its Consumer Insights team spends a great deal of time and resources digging deep to understand whitespace areas and consumer dissatisfaction within these opportunities.

“We are passionate about Canadian consumers and want to exceed their expectations, and answer their needs with our innovation,” says Tanya Van Hoeckel, Director, Consumer Insights, Brand Building.

To ensure its brands and products appeal to key demographics, Kraft Heinz takes into account key and growing cohorts that are strategically important in growing both its business and its customers’ businesses. However, Kraft Heinz doesn’t just focus on demographics, but also on

psychographics such as values, attitudes and behaviours.

“To get innovation and marketing communication right, you need to understand your consumers and what is important to them,” says Attridge. “We do quite a bit of work in this space as our brands lend themselves to multiple consumer groups and profiles. Our role is to determine the right pack size, flavour, container, ingredient profile or usage occasion to meet changing consumer needs.”

"

We are passionate about Canadian consumers and want to exceed their expectations, and answer their needs with our innovation Merchandising Matters

With many purchasing decisions being made in-store, a successful merchandising strategy is key to growing basket size. The teams at Kraft Heinz work closely at store and head office levels to consult on the best placement, mix and week to maximize results.

“We build long-term, sustainable programs designed to create excitement in store to stimulate purchases that are supported with advanced analytics to continuously learn and build year after year,” says Attridge. “After each program is completed, we invest deeply to measure consumer reach and conversion so that we can further optimize and communicate back results and program effectiveness with our retail partners.”

Indeed, Kraft Heinz believes there are two keys to a great merchandising partnership: creativity to increase

Special promotional feature in Canadian Grocer–December 2018/january 2019

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Canada’s #1 Pasta Sauce, Second Only to Homemade Top selling classics include • Tomato Basil • Four Cheese • Alfredo

Pizza Sauce available in two varieties • Fire Roasted Tomato • Traditional

Organic available in three varieties • Sweet Tomato Basil • Tomato Garlic • Marinara

Canada’s #1 super premium pasta sauce.

Available in four varieties • Marinara • Roasted Garlic • Arrabbiata • Roasted Vegetables

#1 market share in the pasta sauces category. #1 loyalty among consumers. #1 brand household penetration in the category.

Nielsen All Channel Homescan L52, period ending 29 Sep 2018

growth and analytics to measure results. “While we have years of experience in building the perfect program, we continue to look for creative ways to find whitespace and new activations in store or online,” says Attridge. “Having retail partners that go with us on this journey to test, learn and find mutual growth is ideal.”

Shopper Solutions With Maximum Impact

Given the complexity of today’s path to purchase, shopper marketing also plays a central role at Kraft Heinz.

The company is dedicated to driving category growth through fresh, innovative and creative shopper marketing programs, for brands consumers love.

“Our approach is always ‘Shopper First.’ Shopper Marketing is a foundational part of how we go to market with our customers and how we engage with our consumers,” says Kevin Royal, VP of Sales Strategy & Shopper Insights. That ties into everything Kraft Heinz does, from initiatives such as its comprehensive innovation agenda to its major partnership marketing programs such as Kraft Hockeyville and Project Play. “We’re trying to see how our brands play and interact together, and how we can grow the basket and delight our consumers,” says Royal.

Since the launch of Kraft Hockeyville in 2006, Kraft Heinz has contributed over $7 million to 183 communities in every region of Canada, helping to entrench the programs

in the minds of consumers. Every year, millions of votes are received for communities vying to be named the next Kraft Hockeyville or awarded the coveted Project Play title.

“From Salmon River, Nova Scotia in 2006 to Lucan, Ontario in 2018, our Shopper Marketing executions help bring these programs to life for our retailers and the communities they serve,” says Royal.

Certainly, what sets Kraft Heinz’s shopper marketing apart is the equity its legacy programs have built up over time with millions of Canadians, as well as the depth and breadth of its brand portfolio. “Our impact on communities, our CSR efforts, our efforts to move from in-store only to omni-channel; we’re trying to lead in this space with new ideas and creative approaches across our programs that are in market every week,” says Royal.

To build sustained programs with multiple touch points, Kraft Heinz leverages the leadership position it has in most categories it plays in. “That gives us an incredible starting position and ensures that we can truly help drive the category and deliver growth for our partners,” says Royal.

“As Shopper Marketers, we want to be the company that best understands the strategic priorities of our retail partners and ensure that our annual programs are fully aligned with our customers' strategic priorities. That’s how we can best grow together.”

Our approach is always ‘Shopper First.’ Shopper Marketing is a foundational part of how we go to market with our customers and how we engage with our consumers

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Special promotional feature in Canadian Grocer–December 2018/january 2019

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Since the 1960’s Kraft Peanut Butter has been proud to hold a place in the pantries of Canadian homes, making us Canada’s favourite peanut butter.

Spreads Brand Equity Kraft Peanut Butter Brand A Brand B Brand C Store Brand Brand D Brand E Brand F Brand G Brand H

59.5% 15.0% 5.8% 3.8% 3.6% 2.5% 2.0% 1.9% 1.4% 1.3%

Ipsos BVC Brand Health Study, Nov 2017

#1 brand equity in the sweet spreads category. #1 loyalty among consumers. #1 brand household penetration in the category.

Nielsen All Channel Homescan L52, period ending 29 Sep 2018

COMMUNITY COMMITMENT Kraft Heinz Canada’s extensive CSR initiatives leave an indelible mark on communities from coast to coast

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s one of the world’s largest food companies, Kraft Heinz has a strong commitment to corporate social responsibility (CSR). In Canada, that commitment translates into a range of community-oriented initiatives and charities aimed at making lives better for people across the country.

“Four key pillars feed into Kraft Heinz’s corporate responsibility strategy: Better Supply Chain, Better Environment, Better Products and Better Communities”, explains Av Maharaj, Vice-President, Corporate & Legal Affairs at Kraft Heinz Canada. “Our goal is to promote responsible, sustainable and environmentally friendly practices across our supply chain, while also improving the products we sell and making impactful contributions to our communities.”

Project Play and Kraft Hockeyville

Over a decade ago, Kraft Heinz recognized a need to support Canadian communities’ recreational infrastructure, says Joanna Milroy, Director of Marketing. “Through Kraft Heinz Project Play and Kraft Hockeyville, we are the spark that brings people together through food and access to play. Our Kraft Hockeyville and Kraft Heinz Project Play programs have awarded over $7 million to support 183 Canadian communities to improve their beloved local recreational facilities.”

Project Play alone has donated more than $2.6 million to 77 Canadian communities across the country to rebuild playground infrastructure. In 2018, Belleville, Ont. received $250,000 to build an accessible baseball field for youth with cognitive and/or physical disabilities. Three runnerups—Antigonish, N.S.; Penbrooke Meadows, Alta.; and Shaunavon, Sask.—each received $25,000 to build better places to play. Starting in August 2019, Project Play will launch again with a back-to-school theme.

Nothing unites the spirit of Canadians like hockey, and since 2006, Kraft Hockeyville has worked to protect and promote the future of the nation’s sport. Each year,

thousands of hockey towns across the country compete for the chance to be named Kraft Hockeyville and win much-needed funding for arena upgrades. The top winner also gets to host an NHL pre-season game in their local community. On Jan. 1, 2019, Kraft Hockeyville kicks off its 13th year.

“Previous winning communities have shared with us some of the inspiring experiences that bring to life the impact of these programs,” says Milroy. “This has included renewed financial support for community projects that were once slated for closure, increased participation in local sport and a renewed sense of community pride that is ‘irreplaceable.’”

Milroy adds that working with media partners Sportsnet on Kraft Hockeyville and with TSN on Kraft Heinz Project Play puts the community projects on the national stage. “This

The town of Lucan, Ont., the 2018 winner of Kraft Hockeyville Canada, was awarded $250,000 in upgrades to its arena. The town also hosted a pre-season NHL game between the Toronto Maple Leafs and Ottawa Senators.

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TM/MC

PROUD TO EXPIRE

The #1 refrigerated dressing brand.

We’re in the produce section for a reason.

raises awareness of the passion and pride of communities and how they rally together around a common cause to make their fundraising efforts translate into reality.”

Why is this important to grocery retailers? “We believe that the grocery store is also at the heart of the community,” Milroy says. “It is integrated into the day-to-day life of community members, and store managers are often very strong influencers in their own communities. We have amazing stories of store managers who have been at the heart of rallying their communities once they have been brought forward as finalists to further drive awareness of the opportunity they have to win.”

Fighting Hunger Globally and Locally

With a mission to eliminate global hunger and malnutrition, Kraft Heinz is committed to delivering one billion nutritious meals to people in need by 2021, through a partnership with Rise Against Hunger. “Our employees at Kraft Heinz Canada have packed over 500,000 meals to help meet this target through their volunteer efforts,” says Maharaj.

Here at home, Kraft Heinz is also committed to helping alleviate hunger. Over the past five years, Kraft Heinz has donated more than $55 million in food donations across Canada, as well as $3.5 million to Food Banks Canada.

Kraft Heinz also shows itself as a corporate citizen with heart by actively responding to communities in their times of need. The company responded last summer by donating nearly 23,000 kg of food to the 100 Mile House Food Bank when wildfires devastated areas of B.C. This

past September, Kraft Heinz sent more than $20,000 worth of food donations to families and communities affected by tornadoes that swept through the Ottawa-Gatineau region.

Partnering with local organizations is another way Kraft Heinz brands contribute to the well-being of Canadians. Since 2016, Kraft Peanut Butter has supported the SickKids Foundation on finding a cure to food allergies and has donated about $400,000 so far. The #KraftBearHugs social media campaign, which ran for a week last spring, raised $200,000 for the cause.

“People with food allergies and their families and friends are constantly worried about where and when they might be exposed,” says Daniel Gotlib, Senior Brand Manager, Brand Building & Innovation. “Allergies are a huge barrier to Canadians coming together and Kraft Peanut Butter—a brand Canadians have known and loved for over 60 years—wants to support SickKids so we can champion more togetherness in Canadians’ lives.”

To ensure success of its various CSR projects, Kraft Heinz works closely with its retail partners and sales team to evaluate and evolve the point-of-sale elements provided. “It is important to us as an organization that we get these pieces right, evolve with the in-store environment and continue to help drive excitement during the in-store shopper experience,” says Milroy. “In 2019, Kraft Heinz wants to make a bigger effort to celebrate winning communities across Canada to remind them of their personal achievements and what they have accomplished by rallying together around a common goal.”

The #KraftBearHugs campaign raised $200,000 for SickKids Foundation last spring

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A TASTE OF WHAT’S TO COME In 2019, Kraft Heinz is rolling out exciting new products designed to meet evolving consumer needs

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raft Heinz Canada’s winning recipe for new product development is a mix of innovation and renovation.

This approach brings new items to shelf to drive category growth, while a focus on core categories keeps its beloved brands relevant. The 2019 lineup features on-trend products that satisfy changing consumer tastes, including their desire for fresher, less processed foods; snacking offerings; and increased convenience.

Philadelphia Cream Cheese Frosting

Consumers are increasingly looking for convenient options, but don’t want to sacrifice quality. Fifty-six percent of consumers agree that baking from scratch requires too much time. Tapping into these insights, Kraft Heinz is introducing Philadelphia Cream Cheese Frosting in February 2019. Available in a refrigerated format, the frosting has authentic Philadelphia cream cheese taste and contains no artificial flavours or colours. The product offers a great opportunity to help drive incremental usage occasions in the cream cheese aisle.

Crave Single-Serve Frozen Meals

With a focus on premium, delicious taste, Crave is made with high-quality ingredients and contains no artificial flavours, colours or sweeteners. Crave is the topperforming new item in the category and is the #1 new single-serve frozen meal brand launched in 2018. Kraft Heinz is adding five more Crave Single-Serve Frozen Meals to the portfolio in March 2019: Smokey BBQ Angus Beef, Buffalo Chicken Macaroni & Cheese, Pulled Chicken Burrito Bowl, Chorizo Egg Scramble with Goat Cheese, Bacon & Egg Scramble with Cheddar Cheese.

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Philadelphia Cream Cheese

available in Q1 2019, Philadelphia Cream Cheese, the leading brand of cream cheese in Canada, has been reformulated to contain no artificial flavours or colours. This renovation is bundled with a new simplified packaging design. The new graphics provide stronger at-shelf shopper navigation and conversion, while bringing a more modern look and feel to the Philadelphia brand.

Special promotional feature in Canadian Grocer–December 2018/january 2019

New Line of Heinz Baby Jars

Nabob Ready Brew

Only half of Canadian households have a single-serve coffee brewer, so there remains opportunity to appeal to consumers looking for convenient, premium singlecup coffee offerings, without a brewer. As of February 2019, consumers can enjoy the coffee they love, anytime, anywhere, with Nabob Ready-Brew coffee sticks, available in 100% Colombian and Full City Dark varieties. The product is made with 100% Arabica, Rainforest Alliance certified coffee and is easy to use: just empty the sachet into the mug, add hot water and enjoy.

Pods

Parents are looking for high-quality baby food in a format that brings benefits such as spoon/self-eating skill development, transparent and recyclable packaging, as well as new and unique flavours. The #1 player in the jar format, Kraft Heinz is renovating its jars portfolio, introducing organic offerings and new recipes with wholesome ingredients like fish, dairy and plant-based protein.

The launch will come in two waves: the first in May 2019, followed by September 2019.

Heinz Infant Ring Puffs Snacks

Kraft Heinz continues to bring new offerings to the pods category. Maxwell House Decaf 30-count pods and Nabob Organic Reserve 30-count pods will be available in January 2019. Decaf makes up 11% of the sales within the 12-count pods format, but only 3% of sales within the 30-count pods format, so there’s clear opportunity to upsize consumers. And while organic growth is outpacing non-organic growth in the coffee category, there are currently no 30-count organic pods offerings, creating another opportunity to upsize consumers with Nabob Organic Reserve 30-count pods.

Infant category growth ($161 MM, +2.6%) is driven by organic pouch and snacking. Heinz Ring Puffs are ringshaped puffs that are perfect for little hands. Available in April 2019, Ring Puffs brings an innovative format that taps into the convenience trend, with a single-serve format for on-the-go snacking. Ring Puffs have delicious vegetable flavours and are made with only five ingredients.

To learn more about any of our new launches, or to place an order, please reach out to your Kraft Heinz sales rep.

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PhiladelPhia Cream Cheese New look, same great Philly taste – with no artificial flavours or colours

We know that consumers care about what goes into the food they eat- so as the leader in cream cheese, we’re committing to a clean ingredient line free from artificial colours and flavours.

Spread the creamy, wholesome goodness of Philadelphia knowing that you are eating only the best.

Up Close with Dana Somerville The new CMO at Kraft Heinz talks plans and priorities for 2019

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21-year veteran at Kraft Heinz, Dana Somerville has always been passionate about brands and building emotional connections with consumers. In her new role as Chief Marketing Officer, Somerville plans to get even closer to consumers.

“We always put consumers first. However, today’s consumers demand not only products that meet their needs and solve problems for them, but also brands that stand for something and say something about who they are,” she says.

For Kraft Heinz, that means its iconic brands need to be connected to what’s happening in culture and be timely participants in culture. “It’s not enough to talk to consumers anymore—we need to engage with them and drive a deeper emotional connection,” says Somerville. “We will continue to uncover human truths and develop brands that have purpose beyond commerce, to drive real brand affinity and brand love.”

Staying relevant locally is also a big priority. “Our structure allows us to tap into our global network of expertise and ideas, while also operating like a local company to develop marketing and innovation that is right for Canadian consumers,” says Somerville. “A lot of CPGs today are just fast-adapting global work, but we recognize the importance of being relevant in local markets, which gives my team a lot of creative autonomy.”

Somerville says that while TV will continue to be an important part of the media mix to drive mass awareness, Kraft Heinz is increasingly focusing on digital, social and earned media to stay relevant and timely in culture.

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We always put consumers first. However, today’s consumers demand not only products that meet their needs and solve problems for them, but also brands that stand for something and say something about who they are When it comes to leadership, Somerville says it’s important to continue to grow her team, and coaching and developing talent is an exciting and critical part of her job.

“I’ve been told I am a very collaborative leader,” she says. “I strongly believe that two heads are better than one, and I get energized by people, so I love working in partnership with my team. I’m also willing to roll up my sleeves to help."

Somerville also believes it’s important to empower people and give people opportunities. “I coach and push my team to bring out their best,” she says. “I have high expectations of myself, and I expect the same from my team.”

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A bold new look for Canada’s favourite salad dressing, with the same great taste.

Absolutely no artificial flavours or colours.

Kraft Salad Dressing retains a large lead on the category in attitudinal equity Attitudinal Equity by Salad Dressing Kraft

37%

Brand A

15%

Brand B

14%

Brand C

10%

Brand D Store Brand

9% 6%

Brand E

4%

Brand F

3%

Brand G

2%

Ipsos, Salad Dressing BVC Brand Health Study, Nov 2017

#1 market share in the salad dressing category. #1 loyalty among consumers. #1 brand household penetration in the category.

Nielsen All Channel Homescan L52, period ending 29 Sep 2018