Author: Mintel Group Ltd.
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Perimeter of the Store - US - June 2014
Scope and Themes
 
What you need to know 
US perimeter of the store categories sold $296 billion in 2014, up from $257 billion in 2009. Sales are forecast to reach $346 billion by 2019, driven by consumer demand for fresh and healthy foods and fresh, convenient prepared foods. Consumers’ shifting focus to the perimeter of the store to find these types of foods is impacting the way they shop for groceries and the way retailers allocate space dedicated to the perimeter. Consumers shop more frequently, spending more time during shopping trips at the perimeter of the store and less at the center. Grocery stores are expanding their perimeter departments, and an increasing number of nontraditional grocers, most importantly mass merchandisers, are providing perimeter foods and services to attract customers.

This report features analysis of these factors, as well as in-depth examination of the following:

●	Where consumers are most likely to shop for perimeter of the store foods such as fresh meat, fresh produce, and dairy products
●	Attitudes toward grocery specialty counters (such as meat departments, service delis, and in-store bakeries), including the importance of personalization and customization
●	Attitudes toward foods found at the perimeter, with an emphasis on how retailers can meet consumer demand for freshness, health, and convenience with these foods
●	Marketing strategies of leading grocery retailers

Definition 
The perimeter of the store, as defined for this report, includes food categories typically found along the interior perimeter walls of supermarkets, grocery stores, and most supercenters. All retail sales of the specified items are included even though differences in store layout may mean that not all stores (particularly food retailers that are not traditional grocers) position these items along the store perimeter. The following segments are used in this report:

●	Meat, poultry, fish/seafood: Includes fresh and frozen. Processed meats, meat products, and meats included in processed food are excluded.
●	Fresh produce: Fresh fruits and vegetables, including bagged salads. Frozen and canned produce are excluded.
●	Milk, dairy, eggs: Fresh dairy and non-dairy milk, cream; butter; cheese (natural, processed, cream cheese/spreads, cottage cheese); fresh eggs. Yogurt, margarine, and other fats/oils are excluded.
●	Bakery: In-store baked breads/rolls only. Packaged loaf breads, rolls, refrigerated bread dough, and cakes/pies/desserts are excluded.
●	In-store deli prepared foods: Freshly prepared foods such as entrées, sandwiches, appetizers, salads, sides, trays, dips, desserts, soups, spreads, etc.

This report builds on the analysis in Mintel’s Hispanics and the Perimeter of the Grocery Store – US, February 2014 and Blacks and the Perimeter of the Grocery Store – US, February 2014. Related reports include:

●	Hispanics and the Grocery Store Experience – US, December 2012
●	Grocery Retailing – US, February 2014
●	The Food and Drink Shopping Experience – US, February 2013
●	In-store Bakeries – US, March 2013
●	Dairy and Non-dairy Milk – US, April 2013
●	Grocery Pricing and Promotion – US, June 2013
●	Lunch Meat – US, June 2013
●	Butter, Margarine and Oils – US, August 2013
●	Yogurt and Yogurt Drinks – US, August 2013
●	Red Meat – US, September 2013
●	Cheese – US, October 2013
●	Fish and Seafood – US, October 2013
●	Fruit and Vegetables – US, October 2013
●	Poultry – US, November 2013
●	The Private Label Food Consumer – US, November 2013 

Value figures throughout this report are at rsp (retail selling prices) excluding sales tax unless otherwise stated. 

Data sources
Sales data
●	Market Size and Forecast and Segment Performance: based on Information Resources Inc., InfoScan Reviews; Bureau of Labor Statistics, Consumer Expenditure Survey; IDDBA/Perishables Group; Progressive Grocer’s Consumer Expenditure Study/Mintel

Consumer survey data
For the purposes of this report, Mintel commissioned exclusive consumer research through GMI to explore consumer consumption of/attitudes and behaviors toward the perimeter of the store. Mintel is responsible for the survey design, data analysis, and reporting. Fieldwork was conducted in April 2014 among a sample of 1,908 adults aged 18+ with access to the internet.

Mintel selects survey respondents by gender, age, household income, and region so that they are proportionally representative of the US adult population using the internet. Mintel also slightly over-samples, relative to the population, respondents that are Hispanic or Black to ensure an adequate representation of these groups in our survey results and to allow for more precise parameter estimates from our reported findings. Please note that Mintel surveys are conducted online and in English only. Hispanics who are not online and/or do not speak English are not included in the survey results.

Mintel has also analyzed data from EMS (Experian Marketing Services), using the Simmons NCS (National Consumer Study) and the Simmons NHCS (National Hispanic Consumer Study).

The Experian Marketing Services, Simmons NCS/NHCS was carried out during November 2012-December 2013 and the results are based on the sample of 23,689 adults aged 18+, with results weighted to represent the US adult population. 

While race and Hispanic origin are separate demographic characteristics, Mintel often compares them to each other. Please note that the responses for race (White, Black, Asian, Native American, or other race) will overlap those that also are Hispanic, because Hispanics can be of any race.

Abbreviations and terms
Abbreviations
The following abbreviations are used in this report:

BBQ | Barbecue
BFY | Better-for-you
CPI | Consumer Price Index
FDA | US Food and Drug Administration
GMO | Genetically modified organism
ISB | In-store bakery
NACS | National Association of Convenience Stores
NHCS | National Consumer Study/National Hispanic Consumer Study (Experian Marketing Services)
rsp | Retail selling price
USDA | US Department of Agriculture

Generations are discussed within this report. They are defined as: 

World War II/Swing generations | Members of the WWII generation were born in 1932 or before and are aged 82 or older in 2014. Members of the Swing Generation were born from 1933-1945 and are aged 69-81 in 2014.
Baby Boomers | The generation born between 1946 and 1964. In 2014, Baby Boomers are between the ages of 50 and 68.
Generation X | The generation born between 1965 and 1976. In 2014, Gen Xers are between the ages of 38 and 49.
Millennials * | Born between 1977 and 1994, Millennials are aged 20-37 in 2014.
iGeneration | Born between 1995 and 2007, members of iGen are aged 7-19 in 2014.
Emerging generation | The newest generation began in 2008 as the annual number of births declined sharply with the recession. In 2014 members of this as-yet-unnamed generation are younger than 7.

* also known as Generation Y or Echo Boomers

In order to provide an inflation-adjusted price value for markets, Mintel uses the CPI to deflate current prices. The CPI is defined as follows:

CPI

The Consumer Price Index is a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.

The CPI and its components are typically used to adjust other economic series for price changes and to translate these series into inflation-free dollars. Examples of series adjusted by the CPI include retail sales, hourly and weekly earnings, and components of the national income and product accounts. In addition, and in Mintel reports, the CPI is used as a deflator of the value of the consumer’s dollar to find its purchasing power. The purchasing power of the consumer’s dollar measures the change in the value to the consumer of goods and services that a dollar will buy at different dates. 

The CPI is generally the best measure for adjusting payments to consumers when the intent is to allow consumers to purchase, at today’s prices, a market basket of goods and services equivalent to one that they could purchase in an earlier period. It is also the best measure to use to translate retail sales into real or inflation-free dollars.

Based on Bureau of Labor Statistics definition.

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