2. Challenging economic climate
• Household consumption expenditure - slower that anticipated
(Household consumption expenditure increased by only 3.5% year-on-year
in 2012);
• High unemployment levels are contributing to the pressure on consumers’
spending
(2012 unemployment remained high at 24.5%);
• Substantial household debt and low savings
(SA has just below 20 million credit active consumers, of which a significant
47% have impaired credit records);
• Rising inflation
(From February 2011 to February 2013 (i.e. over two years) the CPI
increased by 12.3%);
3. Source: NAMC Food Price Monitor
SA EXPENDITURE ON FOOD
25.0
27.0
29.0
31.0
33.0
35.0
37.0
39.0
41.0
Jul‐08
Sep‐08
Nov‐08
Jan‐09
Mar‐09
May‐09
Jul‐09
Sep‐09
Nov‐09
Jan‐10
Mar‐10
May‐10
Jul‐10
Sep‐10
Nov‐10
Jan‐11
Mar‐11
May‐11
Jul‐11
Sep‐11
Nov‐11
Jan‐12
Mar‐12
May‐12
Jul‐12
Sep‐12
Nov‐12
Jan‐13
The cost of a basic food basket expressed as a share of the average
monthly income of the poorest 30 % of the population
2.0
2.2
2.4
2.6
2.8
3.0
3.2
Jul‐08
Sep‐08
Nov‐08
Jan‐09
Mar‐09
May‐09
Jul‐09
Sep‐09
Nov‐09
Jan‐10
Mar‐10
May‐10
Jul‐10
Sep‐10
Nov‐10
Jan‐11
Mar‐11
May‐11
Jul‐11
Sep‐11
Nov‐11
Jan‐12
Mar‐12
May‐12
Jul‐12
Sep‐12
Nov‐12
Jan‐13
The cost of a basic food basket expressed as a share of the average
monthly income of the wealthiest 30 % of the population
29 %
40.4 %
2.3 %
3.2 %
4. The impact of these economic
conditions on the consumer
• Strong focus on good value;
• More price sensitive;
• Better planned consumer spending (less impulsive purchases);
• More attention to sales / promotions;
• Focus on convenient (and often nearby) location of retailers;
• Focus on ‘tried and trusted’ products;
• Increased focus on home-prepared meals;
• Availability of high quality fresh produce; and
• Products delivering health and safety at an affordable price.
4
6. 6
Source: Stats SA, 2013.
Expenditure patterns
0
10
20
30
40
Lower 2 3 4 5 6 7 8 9 Upper Total
Percentage
Income deciles
Food and non‐alcoholic beverages
Alcoholic beverages and tobacco
Clothing and footwear
Housing, water, electricity, gas and other fuels
Furnishings, househould equipment and routine maintenance of the dwelling
Health
Transport
Communication
Recreation and culture
Education
Restaurants and hotels
8. Food affordability in South Africa: Price remains important
8
Cost of NAMC
Food Basket in
2010, 2011 and
2012 prices for
each item
Sources: For 2001
from Jacobs, 2009.
StatsSA & AC Nielsen
(2005, 2013)
Food groups and items 2010 2011 2012
Bread and cereals
Loaf of brown bread 700g 7.06 7.70 8.45
Loaf of white bread 700g 7.88 8.65 9.46
Maize special 5kg 16.64 17.71 26.95
Rice 2kg 21.41 20.42 21.51
Beef brisket - fresh per kg 45.26 51.34 57.55
Whole chicken - fresh per kg 28.29 29.37 32.20
Fish (excl tuna) - tinned 425g 12.12 11.33 12.08
Dairy and eggs
Full cream milk - fresh 1ℓ 8.55 6.78 9.38
Eggs 2.5 dozen 34.45 33.58 35.79
Fruit
Apples - fresh per kg 12.13 13.28 13.55
Bananas - fresh per kg 9.69 10.27 11.00
Oranges - fresh per kg 7.39 7.14 7.87
Vegetables
Potatoes - fresh per kg 9.25 9.87 9.03
Tomatoes - fresh per kg 14.73 9.15 9.86
NAMC food basket 396.43 418.82 451.08
9. How do we create consumer
awareness of potatoes?
9
NUTRITION TABLE
FOR LABELLING
PURPOSES
12. Price and income is simple to
measure. However the
impact of awareness on SA
consumers can only be
measured over an
extended period
Measuring marketing results
17. Potatoes and sport
17
The Comrades Marathon
• Approximately 20 000 runners
• 90 km endurance race
• Potato South African (11 potato fuel
stations along the route)
• Potatoes has become known for
preferred carbo-loading food for
endurance races
• Also involved in other endurance sport
e.g. soccer and cycling.