2Copyright2017 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. WELCOME The formula for growth is simple. There’s really only three levers youcan pull: fnd new buyers, get your buyers to spend more, and/or raiseprices. But, talk to most retailers and fast-moving consumer goods (FMCG)companies today and they’ll tell you that growth is increasingly hardto fnd. Our population is growing at the slowest rate since the GreatDepression. For many categories across FMCG, we’re actually in adefationary environment. And for many consumers, they’re spendingtheir dollars elsewhere.So, it’s no surprise that the total FMCG and retail pie doesn’t appear tobe growing at all. But we’re not facing a slowdown. What we’re beingforced to grapple with is a systemic change to where, how and whyconsumers are shopping.But, the good news is, there are new consumers entering the market.Many of those consumers are willing to pay a premium for what mattersto them. So, how do we turn those factors in our favor and create realgrowth That’s why I’m excited to share this report with you. We’ll followconsumers’ dollars and help you understand why these new channels,services and brands are winning. And what’s more, we’ll give you asense of what you can do to respond. CHRIS MORLEY PRESIDENT, FMCG AND RETAIL NIELSEN 3Copyright2017 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. CONTENTS OVERVIEW ... 4 E-COMMERCE ......... 5 RETAIL .........11 TOTAL STORE .........15 HEALTH & WELLNESS ........19 RESTAURANTS & FOOD SERVICE . 23 MULTICULTURAL ....26 CONCLUSION ........ 29 ENDNOTES..304Copyright2017 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. OVERVIEW Remember when business was just a little simpler Back before media andretail platforms and channels had really fragmented. Back before digitaldisruption had really taken hold. We’re not talking about decades though.Can you remember back just a few years It used to be that a rising tide raised all boats across FMCG and retail.When growth was abound, we all benefted. Over the last few months,there are many signs that the tide has washed back out to sea as growthhas all but dried up.But, the tide is still rising. It’s just being much more selective about whichboats it’s lifting.In some ways, this is nothing new. Just three years ago, the smallest 10,000or so companies drove half of the growth across food and beveragecategories. At the same time, the largest ten companies contracted. Butthe pace of change is unlike anything we’ve seen. Today, the only food andbeverage growth that remains is from that long tail of companies.1 We seesimilar dynamics play out across the entire FMCG and retail landscape. Over the last few years, the FMCG retail landscape has expandedtremendously. The emergence of new platforms like meal kit andrestaurant delivery services, and the expansion of deep discount, freshand convenient retail formats have given consumers more choice thanever. It’s nearly impossible to cast a net wide enough to capture all of thisfragmentation. But if you do, looking across all of these channels, a fundamentallydiferent view of the landscape emerges.Look at the growth across the traditional retail landscape including UPCand random weight products. Add to that growth from emerging fresh,convenience, club and discount retailers. And fnally layer on emergingonline channels and the “doom and gloom” story about an industry in perilshows moderately healthy growth once again. 1Nielsen Answers, Total U.S., 52 weeks ending May 27th 2017 vs. year-ago, and 52 weeks ending May 31st, 2014 vs. year-ago,UPC-coded, Based on manufacturers selling at least $100,000 per year 。。。。。。