eric le blanc, vp of marketing, deli, tyson foods - consequences of failure

Consequence of Failure:What happens when things go wrong

Eric Le Blanc,Tyson Foods, Inc.

A light-hearted romp through our worst fears and nightmares

• Why it’s critical to get things right: surely this is obvious, right? Right?

• Don’t try this at home—though the data suggests you already may

• The morning after—I’m never doing THAT again!

360 Degree Competition

Dinner without a plan

70% of shoppers decide TODAY what’s for dinner TONIGHT

27% only decide what’s for dinner when hungry or prompted

The decision to purchase PF is typically made before the shopper enters the store (67%)

Source: Tyson On the Go Foodservice Study, 2014

The battle is won or lost before the consumer ever crosses the threshold

• Supermarket Prepared Foods is NOT top of mind in the 4:00 dilemma

• It ranks third in the consideration set, behind QSR and pizza

• In most cases, Supermarket Prepared Foods is not driving awareness outside of the store

• And…


The battle is won or lost before the consumer ever crosses the threshold

The single biggest driver to future visitation is satisfaction with the previous experience

How should we feel about that?


What failure looks like:

• 41% of shoppers report a problem in their prepared foods shopping experience in the past 90 days

• Of these, 53% will stop shopping the retailers for a period of time

Source: Consequence of Failure Study, 2015

Incidence of ProblemsGeneral Deli Issues 42.9%

Product Issues 46.7%

Staffing Issues 22.2%

• General Deli Issues: long wait time, products weren’t ready, products weren’t available or were difficult to find, deli wasn’t sanitary

• Product Issues: product didn’t appear fresh, wasn’t tasty, wasn’t of good quality, was overcooked/dry, was undercooked

• Staffing Issues: staff wasn’t knowledgeable, helpful, or friendly; staff was rude

Source: Consequence of Failure Study, 2015

10

Impact of a problem on satisfaction:

Prepared Foods Shopping Experience

Overall shopping experience

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0%

55.3%

82.4%

47.9%

65.1%

% of Shoppers Reporting (Top three box)

Problem No problem

Source: Tyson Consequence of Failure Study, 2015

Satisfaction with the prepared foods shopping experience AMONG DELI PREPARED FOODS SHOPPERS lags their satisfaction with the whole store shopping experience!

11

Impact of a problem on likely to recommend:

Likely to shop

Likely to recommend

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0%

80.9%

77.4%

56.6%

50.6%


Problem No problem


Given that the consumer has so many choices for convenience meals, retailers cannot afford this negative impact on the pre-shop decision-making process

12

How satisfied are you with:

Prepared Foods Shopping Experience

Overall shopping experience

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0%

32.2%

43.8%

46.6%

57.4%

22.2%

34.3%

% of Shoppers Reporting (Top two box)

Worst Best Industry


13

Problem Areas

Staffing Issues

Product Issues

General Deli Issues

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0%

22.2%

46.7%

42.9%

13.5%

33.8%

32.7%

43.5%

63.8%

63.8%

% of Shoppers Reporting

Worst Best Industry


14

Drivers of purchase intent:Problem vs no problem

Like the convenience

Frequently purchase

I like the quality

Likely to purchase next time

My friends and family enjoy

I am proud to serve

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0%

78.9%

50.7%

75.0%

61.6%

70.2%

66.4%

58.9%

37.2%

45.6%

43.7%

45.0%

41.4%


Problem No problem

#1 driver of purchase intent


Deli prepared foods shoppers who have experienced a problem show drastic reductions on all drivers of purchase intent: This reduction is a strong negative impact on pre-shop attitudes and behaviors

15

Drivers of purchase intent:By type of problem


Frequently purchase

I like the quality



I am proud to serve

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0%

78.9%

50.7%

75.0%

61.6%

70.2%

66.4%

53.7%

41.3%

42.6%

41.7%

42.3%

40.2%


General Deli Product Staffing No problem



While generally speaking, all types of problem negatively impact purchase intent, the most pronounced effect is a result of product problems; deli shoppers appear to be somewhat more tolerant of “general deli issues”

16

Staffing Issues

Staff was rude

Staff was not friendly

Staff was not helpful

Staff was not knowledgeable

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0%

22.2%

46.7%

7.3%

6.2%

10.0%

33.8%

2.6%

2.1%

43.5%

63.8%

15.9%

17.4%


Worst Best Industry


17

Change in store visitation as a result of staffing issues

Permanently

For a long period of time

For a short period of time

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0%

6.8%

9.4%

38.5%

3.6%

2.2%

14.3%

14.3%

28.0%

69.2%


Worst Best Industry


18

Considering staffing issues…


Frequently purchase

I like the quality



I am proud to serve

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0%

43.9%

37.2%

38.7%

37.7%

36.9%

37.3%

64.3%

68.8%

58.7%

68.8%

68.8%

59.5%

28.0%

16.0%

12.5%

9.1%

25.0%

18.2%


Worst Best Industry



19

Product Issues

Product quality was poor

Product taste was poor

Breading was not crispy

Product was overcooked

Product did not appear fresh

0.0% 5.0% 10.0% 15.0% 20.0% 25.0%

7.4%

7.5%

10.5%

12.4%

12.6%

2.6%

2.9%

5.3%

4.9%

4.9%

14.9%

16.3%

18.4%

20.3%

21.3%


Worst Best Industry


Cook to proper temperature and follow holding procedures to eliminate major product issues

20

Considering product issues, how likely are you to:

Visit

Recommend

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0%

45.2%

40.0%

61.9%

68.4%

26.2%

22.0%


Worst Best Industry

No product issue : 48.5%

No product issue : 51.6%


As with staffing issues, the greater negative impact is on likelihood to recommend

21

Considering product issues…


Frequently purchase

I like the quality



I am proud to serve

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0%

44.3%

31.8%

32.1%

32.5%

31.3%

29.4%

60.6%

48.9%

51.5%

54.5%

54.5%

48.5%

31.1%

21.3%

19.7%

21.3%

21.3%

19.5%


Worst Best Industry



22

Change in store visitation as a result of product issues

Permanently



0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%

3.5%

6.9%

25.5%

1.6%

2.3%

6.1%

5.7%

19.7%

35.1%


Worst Best Industry


23

General Deli Issues

Deli was not sanitary

Products were difficult to find

Products were not available

Products were not ready

Long wait time

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%

3.3%

4.7%

13.4%

9.9%

24.4%

0.8%

0.8%

5.4%

4.3%

14.5%

8.7%

13.0%

18.3%

18.8%

35.4%


Worst Best Industry


24

Considering general deli issues, how likely are you to:

Visit

Recommend

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0%

51.1%

47.1%

78.8%

75.8%

36.2%

29.8%


Worst Best Industry


The shopper appears to be somewhat more forgiving of general deli issues, suggesting issues like long lines are an un pleasant though expected feature of the shopping experience

25

Considering general deli issues…


Frequently purchase

I like the quality



I am proud to serve

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0%

50.8%

37.4%

43.8%

41.4%

44.2%

40.4%

63.6%

55.6%

57.6%

58.1%

62.9%

56.5%

33.3%

28.3%

23.6%

35.8%

32.1%

28.3%


Worst Best Industry



26

Change in store visitation as a result of general deli issues

Permanently



0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0%

3.3%

4.4%

22.4%

1.6%

3.8%

8.5%

4.4%

8.1%

42.9%


Worst Best Industry


Conclusions

• The battle for the prepared foods visit is won or lost OUTSIDE of the store

• Problems happen FAR too frequently and the consequences can be severe far beyond the prepared foods area of the store

• The ability to execute may be the single most greatest competitive point of difference

Implications

• Drive awareness– Elevate your place in the 4:00 consideration set

• Train store associates for:– Product knowledge– Customer service principles

• Control product– Availability– Cooking time/hold time

Thank you!

eric le blanc, vp of marketing, deli, tyson foods - consequences of failure

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