STiR coffee and tea magazine

34 STiR coffee and tea / Issue 6, 2019 (December / January 2020) Massimo Zanetti packaging line to appeal to consumers. As a result, the manufacturers are in- vesting resources to better understand what consumers want – predictive capabilities – and then delivering those expectations to the marketplace. "What you're really seeing is a change in speed to market on items that are trending upward," Dockery said. "There are some really interesting things that have come into the market We're see- ing an increase in some pour overs. We're seeing an explosion of ready-to-drink products that is by no means an emerging trend, but the cold brew is relatively new, and it didn't take any time at all for retailers to have cold brew offerings within their portfolio." A pre-recession sales bump? Another IRI report, however, prompted differing reactions. The research firm's Consumer Connect Survey, also released in November, indicated that overall private brand dollar sales grew 3.8% this year. That's twice the rate of national brands. Dockery and Campanella held different views of one con- clusion in the report that stated while 57% of consumers say their financial health is good, concerns for a possible economic downturn or recession are prompting them to increase savings and spend wisely as precaution. The survey looked at shopping behaviors by income and generation. All income and generational groups strongly en- dorsed the concepts of buying private label and lower-priced brands to save money. At the same time, consumer savings increased 4% in the third quarter compared to a year ago. That increase also fell across all income and generational groups. The IRI research is conducted at the end of each calendar quarter. "While shoppers across generations and income groups in 2019 are undoubtedly more price conscious, they are turning to private label because of their positive perceptions of the value," said Joan Driggs, v.p. of content and thought leadership for IRI. "Shoppers are buying private brands because it makes them feel good to save money without sacrificing taste, selection or qual- ity. The improved consumer perception of private label value is having a growing influence on store choice, with many leading retailers offering premium private label selections." Campanella agrees with the conclusion. "I totally do, both as a consumer and as someone in the private label industry," he said. "Our private label customers' coffee is up year-on-year. Some are up quite a bit, other are up slightly. Some of the national brands are starting to suffer. I don't know that it is recession driven but things don't feel as good as you read sometimes [in government economic reports]. The reports are strong, but I think consumers have become more sophisticated. There's not much a national brand can do to make their single-ingredient product better." Dockery, on the other hand, says sales increases during a re- cession are common in the private label industry. He's skeptical about linking recession fears to additional sales. "We have never had a pre-recession bump," he said. "We always have had a recession bump and post-recession we've seen a slight decline overall in private brand sales. After the last recession, we maintained the bump post-recession. So, I don't put any credibility into an observation that consumers are tight- ening their belts by converting to private brand in anticipation of financial struggles ahead." mon for most baskets. We produce whole bean, ground and single service and we're seeing that growth across all those seg- ments." Dockery sees the same trend as retailers put additional resources toward marketing their own private brand products. "They have recognized for some time that private brand is a differential advantage they have versus their competitive set," Dockery said. "So, they're highly motivated to offer the right assortment with an appropriate focus on innovation." Retailers increasingly are turning to manufacturing partners such as Club Coffee and Massimo Zanetti in search of new ways

• Cover