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Dispensing Strategies: Vending Trends 2008

Vending Trends 2008


February 26, 2008
By Michelle Brisebois

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The times, “they are a changing” and so must we.  This past year saw many cultural shifts in consumer behaviour and most
of these changes do have an impact on the vending industry one way or
another.

The times, “they are a changing” and so must we. This past year saw many cultural shifts in consumer behaviour and most of these changes do have an impact on the vending industry one way or another. Some changes come faster than others but it’s safe to say that if we don’t stay on top of consumer trends – we could find ourselves struggling to make ends meet.  Here are a few key trends to watch over the next year or two. 

Still Green


This trend continues to rule. A 2007 study by Eco Watch reports that 79 per cent of Canadians believe global warming has begun. A healthy 61 per cent of Canadians plan to help the eco-cause by purchasing products with less packaging. Bottled water has come under fire because so many of the plastic bottles end up in landfills. Look for vending options that minimize excess packaging. Your customers will be watching.

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Here’s To Our Health


As people age, health issues become more important to them and let’s face it, the baby boomers are hanging onto their youthfulness with every breath in their bodies. Breakfast bars are replacing traditional candy bars as a firm favourite.

Global Business Insights reports that sales of cereal bars will grow at more than seven per cent per year over the next two years. Beauty products are more natural using “medicinal-like” ingredients. According to the NPD Group, cosmeceutical brands make up approximately 11 per cent of prestige skin-care sales.

Big Bite – Small Portions


As North Americans took a good look at their eating habits, they realized that portion sizes had become excessive. Smaller portions of better quality treats such as gourmet chocolate provide a guilt-free indulgence.
 
The fastest-growing segment of the $23-billion U.S. candy market is “extreme” or “novelty” candy. This is the industry’s name for products with extreme flavours, grotesque or horrific themes, or play value. This may be the influence of the Harry Potter books at work, which feature these types of candies.

No Corny Joke


High fructose corn syrup is a sweetener commonly found in soft drinks and candy. Datamonitor reports that the number of new food and beverage products launched worldwide claiming to contain no high fructose corn syrup (HFCS) nearly tripled in 2007 compared to all of 2006. This trend is partly fuelled by the trend towards healthy eating but it’s also rooted in – well … trends in fuel.

Corn prices have skyrocketed as the biofuel industry turns to the humble ear as a new fuel source.  Food prices rose 10 per cent in 2006, “driven mainly by surging prices of corn, wheat and soybean oil in the second part of the year,” the International Monetary Fund reported this past May.

Look for more products to dump HFCS and look for products with a corn base to rise in price.

Cold For Teacher


It seems that schools have become the battlefield on which the vending war is being waged. The Ontario Liberal government (following Manitoba’s lead) has introduced legislation
to ban trans-fatty foods from school cafeterias and vending machines.

Chocolate bars, potato chips and soft drinks have already been banned from Ontario’s elementary schools. This legislation would see this ban extend to the high school sector as well.
It would be wise for us to be proactive and look for healthy options. Look for vending locations in areas adjacent to high schools as well. I know my kids are leaving the school property in search of tasty food.  Perhaps the government counts these “off-site strolls” as their physical education program?

Going Loonie


When it was at 95 cents, nobody raised an eyebrow. When our dollar reached parity with the U.S. Greenback – consumers raised the roof.

Suddenly, retailers were under the gun to drop their cash drawers and drop them they did. From Zellers to Chapters Indigo, many companies cut prices to keep shoppers in Canada. This has created quite an appetite for a bargain.

Consumers are making their dollars stretch and as a result, they’ll probably be more receptive to “value products.” Make sure your product mix has some value-based items to capture this public sentiment.

Snacking – The New Daypart


Twenty-three per cent of all meals consumed are snacks, compared to 22 per cent for lunch, reported the NPD group in 2006.

It seems that more and more people are beginning to grab something quickly on the run. Foods such as potato chips, cookies, and granola bars are no longer being consumed just in between meals. This trend is being driven by a desire to avoid cooking or any planning (as with brown-bagging something from home).

This bodes well for food vending. Make sure the machines have some healthy
options and energy bars.

Digital Rules


YouTube, iTouch, Wii, the Internet all fall under the umbrella of digital media. This venue is developing so quickly – the possibilities are endless.

Most of the digital signage that has gone into vending machines has been based on the LCD display components. Experiments with touch-screen technology and self-guided video content have proven effective when applied to vending machines, especially when selling electronics such as cameras, wireless phones, and iPods).

Cellphones appear to be a strong conduit for the retail connection. Coca-Cola Japan said that all of its 200,000 machines by the end of 2008 will accept Felicia, contactless credit cards on mobile phones. Coca-Cola has indicated it will arm all its vending machines in Japan to accept payment through mobile telephones, an increasingly popular money option in
the country.

This process will now make it possible to buy any soft drink, coffee, tea or fruit drink in Coca-Cola machines in Japan by holding up a mobile phone to the machine, with the cost of the refreshment going on a monthly phone bill.

It’s only a matter of time before this trend gains momentum here.
Vending is a traditional term for what today’s marketing gurus refer to as “pop-up retail.” The self-serve channel has never been in a better position to benefit from oncoming trends than it is now. It’s simply a matter of getting out in front of the wave.

The numbers at a glance:

  • Cereal bar sales expected to grow seven per cent
  • Fastest growing candy segment is “extreme” or “novelty” lines
  • Food prices rose 10 per cent in 2006
  • 23 per cent of all meals consumed are snacks


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