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COVID-19 is changing consumer coffee habits

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Home has become ground(s) zero for coffee consumption during the current COVID-19 crisis, according to a new study.

While Canada’s coffee addicts might argue that they are essential services, the country’s largest coffee chains have either limited access or closed stores entirely as a result of the COVID-19 crisis. That has led to a “big shift” from out-of-home to in-home consumption, according to Field Agent Canada.

In a recent survey of 700 Canadians, more than three-quarters of respondents (79%) identified as regular coffee drinkers. Coffee consumption has remained stable during the pandemic, at an average of 2.4 servings a day.

But while 91% of Canadians were consuming coffee purchased outside the home prior to the enforcement of social distancing rules, that number has fallen to 46% amid social-distancing requirements.

One of the most pronounced changes in at-home consumption has been the rise of instant coffee, with 25% of respondents saying they have used it at home in the past week. It is the biggest segment among respondents who indicated that they have tried new coffee drinks during the stay-at-home period, ahead of cappuccino, drip coffee and lattes.

Tim Hortons is the most frequently used coffee brand at home (13%), followed by Folgers, Maxwell House, Starbucks and Nescafé (all at 8%) and Nespresso and McCafe at 7%. There has been some experimentation among coffee drinkers, however, with 11% of respondents indicating they have purchased another brand because their preferred brand was out of stock.

Ten per cent of respondents said they have purchased a brand that’s more expensive than their usual brand, while 7% said they have purchased a less expensive brand. Twelve per cent said they have experienced longer than usual wait times for online orders.

Not surprisingly, supermarkets were the most common response given to a question about where respondents had purchased coffee for home consumption (35%), followed by Costco (26%), Walmart (23%) and drug stores (7%).

Six per cent of respondents said they have purchased a new coffee machine since the crisis began, with drip coffee, Nespresso and K-Cup machines the most popular new purchases. Coffee is a $6.2 billion business in Canada, according to the Canadian Coffee Association and, along with water is the most commonly consumed beverage among adults.

Originally published at Canadian Grocer. 


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B.C. steps up emergency response to COVID-19 with co ordinated supply chain plan

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British Columbia invoked extraordinary emergency powers Thursday to protect consumers from profiteers and to maintain the steady supply of goods and services for those who need them during the COVID-19 pandemic.

The powers will also unify provincial response efforts while taking an inventory of public spaces that could serve as possible COVID-19 pandemic treatment facilities.

Premier John Horgan said the measures are required to ensure the flow of essential goods and services and support B.C.’s fight against the novel coronavirus, which has resulted in 14 deaths and infected more than 650 people.

“The steps we’ve taken today are unprecedented,” he said at a news conference. “This is not a drill, it’s a pandemic.”

Horgan said the powers under the Emergency Program Act are required to add more force to recent orders by B.C. provincial health officer Dr. Bonnie Henry, who has instructed people to self-isolate for 14 days if sick or recently returned from travel and practise physical distancing.

“Today, we believe we are on the right track,” said Horgan. “If we need to do more we will.”

Public Safety Minister Mike Farnsworth said the emergency orders will support efforts by Henry and Health Minister Adrian Dix to reduce the numbers of infected people.

“Listen to Dr. Henry,” he said. “Dr. Henry’s orders are not suggestions or good advice, they are the law.”

Municipal bylaw officers will be permitted to enforce orders limiting the size of gatherings and business closures, Farnworth said.

The government is also looking to use vacant convention centres and other large community spaces for overflow health facilities, he said.

Dix said earlier this week, the province’s cancellation of elective and scheduled surgeries has created space in B.C. hospitals for up to 4,000 patients.

Farnworth said the government has created a supply-chain unit of government and industry advisers that will co-ordinate the flow of goods and services by land, air, marine and rail. He said aircraft currently not flying due to global travel restrictions could be used to make deliveries of supplies.

Farnworth said the resale of food, medical supplies, personal protective equipment and cleaning products has also been banned.

Passenger and car-ferry services will be cut to minimum service levels and support for critical services for vulnerable people will be increased to stock food banks and provide shelters, he said.

The order also suspends the many community states of emergency already in place to avoid a patchwork response to the pandemic, said Farnworth, adding the suspension does not apply to Vancouver, which has its own community charter.

“It’s very much a co-operative effort,” he said. “It does give us some considerable power, but again, it’s all about planning for the long term as well as the immediate needs.”

Vancouver announced the opening of two emergency response centres in the city’s downtown to create additional space for homelessness people. It says the centres are operating on a referral basis to help reduce the spread of COVID-19.

“We understand this is an unprecedented use of our community centres, but deploying them in this way is critical to try to prevent the spread of the virus and mitigate the demand on our health-care system,” city manager Sadhu Johnston said in a news release.

Farnworth declared a provincial state of emergency on March 18, the day after Henry declared a public health emergency on March 17.


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Millennials represent opportunity for c-store retailers

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Millennials (individuals born between 1980 and 2000, or those who are currently between the ages of 18 and 38 years old), in Canada are mighty in size, but data suggest they’re spending less than their size suggests they should.

According to Statistics Canada, Millennials account for 10.1 million consumers across Canada, representing 27.5% of the total population. Despite the big numbers, however, this generation accounts for just 12% ($13.2 billion) of the country’s fast-moving consumer goods (FMCG) spending. The upside for manufacturers and retailers, however, is that Millennials lead all generations in dollar spend per trip.

So why are they shopping less? Partly because of their increased trips to restaurants, as studies show Millennials led other age cohorts in trips per capita to restaurants. Canada now has an abundance of restaurant options with eclectic cuisines, which makes dining out a desirable and easy alternative to cooking at home.
The news isn’t all bad, however. Even though Millennials make fewer trips than other shoppers, they spend more per trip than any other generation. Millennials spend $55.45 per trip, up $2.11 from last year, and more than $7 above the national average. In addition to shopping trip differences, Millennials shop in different stores and tend to prefer dollar, drug and convenience stores more than the average shopper. In fact, millennials are 103% more likely to shop in the convenience channel than the average Canadian.

But as Millennials shop less, manufacturers and retailers need to work to pull them back into the store. One strategy involves identifying what Millennials are seeking outside the store and finding ways to meet those desires in store. For example, by offering ready-to-go meal kits and a variety of deli-prepared foods from different cultures in store, convenience retailers can provide a new shopping experience that encourages consumers to spend on items they might otherwise purchase at other out-of-home channels, like restaurants, in a quick and easy channel.

Providing a full-service offering with a great experience to a customer within a small store format can be challenging. First, small format stores should continue to defend the areas that differentiate them from large format stores – their convenient location, customer service and the quality and range of foods to ‘eat now’. Raising the bar on areas like offering more of a range to meet their customers’ needs, high quality fresh food, fast checkouts and ease to shop quickly are also ways to compete more closely with large format stores.

With dwindling time, and the increasing interest in health and wellness, convenience stores are well positioned to empower consumers to become their perceived selves and provide convenient, healthy options. By focusing on the needs of the convenience consumer, while staying true to the core offering of the channel, manufacturers and retailers in the convenience channel can not only maintain growth but flourish at a time of market disruption.

The convenience channel is also well positioned to meet the needs of consumers looking to top up quickly. Convenience stores therefore need to focus on the reasons that shoppers come into their stores for these trips. By honing their offering to become the obvious choice every time someone needs milk, their morning coffee or a great snack for the road, convenience stores will win the trip over other channels.
As the Canadian convenience retail landscape evolves, the road is filled with new and unique opportunities to align with consumers’ growing interest in quick trips and new product offerings. Convenience retailers that provide consumers with a variety of high-quality, convenient prepared foods will help ensure that consumer dollars, and especially the all-important Millennial dollar, stay in the c-store.

Isabel Morales is the manager, consumer insights for Nielsen Canada.

 

 


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U.S. consumer watchdog agency probes 6 more vaping firms

Federal consumer watchdogs have ordered Juul and five other vaping companies to hand over information about how they market e-cigarettes, the government’s latest move targeting the industry.

The announcement Thursday from the Federal Trade Commission comes amid a nationwide crackdown on e-cigarettes as politicians and health authorities try to reverse an explosion of underage vaping by U.S. teenagers.

The FTC said in a statement it wants to “better understand” vaping sales and promotional practices, including e-cigarette give-aways, online influencer programs and marketing on college campuses. Those techniques are also at the centre of several state and federal investigations into whether Juul’s early viral marketing efforts helped spark the surge in teen vaping.

Last week San Francisco-based Juul announced it would cease all advertising of its small, discrete vaping devices. A company spokesman said Thursday in a statement: “We will fully co-operate and are focused on earning the trust of regulators, policymakers and other stakeholders.”

Federal law prohibits traditional tobacco companies from numerous sales tactics, including giving away cigarettes, sponsoring sports events and advertising on television, radio, public transportation and billboards. But those laws don’t apply to e-cigarettes, which first launched in the U.S. in 2007.

More than one in four high school students report vaping in the past month, according to the latest government survey data. Top health officials have called the trend an epidemic that risks addicting a generation of young people to nicotine.

Besides Juul, the government is also seeking information from R.J. Reynolds Vapor Company, Fontem US, Logic Technology Development, Nu Mark and NJOY. Regulators want to review company materials beginning in 2015.

Besieged by criticism, Juul announced a series of surprise concessions last week: halting all advertising, pledging not to lobby against a planned federal ban on vaping flavours and replacing its CEO. Juul already faces multiple investigations from Congress, the Food and Drug Administration and several states attorneys general.

The privately-held company controls nearly 70 per cent of the U.S. retail market for e-cigarettes and became a cultural phenomenon on the success of its high-nicotine, flavoured pods.

Most experts agree that e-cigarette vapour is less harmful than cigarette smoke because it doesn’t contain most of the cancer-causing chemicals in burning tobacco.

The recent outbreak of lung illnesses mostly involves people who say they vaped THC, the high-inducing chemical found in marijuana. Still, health inspectors have not ruled out any products and are encouraging Americans to avoid vaping until they determine the cause of the illnesses.