NEAR EAST OLIVE PRODUCTS
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1 NEAR EAST OLIVE PRODUCTS SYRIAN CONSUMER BEHAVIOR
2 Intro IMPORTANCE OF OLIVES & OLIVE OIL IN THE SYRIAN DIET years of cultural significance Used dby 100% of the population Estimated consumption per capita is per year: 55k 5.5kg of olives per person 5kg of olive oil per person
3 Intro IMPORTANCE OF OLIVES & OLIVE OIL IN THE SYRIAN DIET Olive consumption habit: Especially at breakfast In mezzeh As topping (pizza, savory pastries, etc.) Olive oil consumption habit: hbi Mainly used upon mezzeh or breakfast spread Preservation of food Cooking
4 Intro OLIVE OIL VS. EDIBLE OILS Type of oil Qty per year Main usage Soybean oil ~ MT Frying Palm oil ~ MT Ghee Cotton oil ~ MT Frying Sunflower oil ~ Frying, Cooking, salad OLIVE OIL ~ MT Mezzah, Preservation, cooking
5 Intro OLIVE OIL VS. EDIBLE OILS Consumption 16% 24% 24% 16% Soybean oil Cottlon oil Sunflower oil Palm oil Olive oil 20%
6 The Consumer SEGMENTATION Rural Population Urban Population +50 years old 30 to 49 years old
7 The Consumer RURAL POPULATION Most of rural population produces own olive oil Production self sufficient for their consumption Any excess production sold in market Price defined according to acidity Taste not a criteria of quality
8 The Consumer URBAN POPULATION Study segmentation: + 50 years old vs. younger generation Mi Main difference is method of purchase Older generation still accustomed to annual storage. Choose to buy whole year consumption during the season in 16kg tins. Purchase habit changing with younger generation: Limited it purchasing power New houses smaller hence a lack of storage space Impractical usage of 16kg tins (prefer smaller packaging) Nevertheless, expectations and usage of product remains the same among whole Syrian population
9 Behavior QUALITY Three main types available in the market: Extra virgin olive oil Virgin olive oil Ordinary olive oil (still permitted in Syria) No market for pure or pomace olive oil Consumer not concerned with the type Prefer sweet tasting olive oil Consumer misconception that good olive oil is green
10 Behavior PACKAGING Rural population: More than 95% sold in 16kg tins Urban population: Consumers above 50 mainly buy 16kg tins Younger generation tends to buy smaller packaging. Most popular size after 16kg is 5lt and 4lt. 5lt and 4lt are mainly sold in PET rather than tins Consumers prefer seeing product Cheaper than tins In volume, sales of glass bottles are marginal
11 Behavior RECURRING OLIVE OIL PURCHASES (PER CAPITA) Rural population: Acquired once a year during the season Urban population: 63% purchase annually 16% purchase bi annually 10% purchase quarterly 9% purchase monthly
12 Behavior WHO IS THE DECISION MAKER? Rural population decision maker: Male of the household Urban population decision maker: 62% of purchases done by male of the household 22% of purchases done by housewife 16% is done by other family members
13 Behavior PRICE EFFECT Press Press Selling Price Price to consumer 3.00 USD / kg Price to professional 2.76 USD / kg Selling Price Wholesale 3.24 USD/kg Factory 3.50 to 5.22 USD / kg Retail Selling Price Distributor 4.10 to 6.14 USD / kg Consumer Selling Price Retail 4.60 to 7.00 USD / kg
14 Behavior PRICE EFFECT Syrian market extremely price sensitive As a consequence: 84% of sales still done in 16kg tins 84% sold outside of retail sector People prefer to buy big sizes rather than bottles due to Syrian mindset getting more value for their money
15 Sales Channels MARKET SHARE PER SEGMENT 4% 16% 24% Press Wholesale Retail Other 56%
16 Sales Channels DIRECTLY FROM THE PRESS Consumers purchase annually at the press All sales in 16kg tins Three main motivators: Most cost effective method of acquiring ii product Guaranteed no mixing of oils Annual storage habit
17 Sales Channels WHOLESALE Wholesale includes direct delivery to consumer Wholesaler l resells product either in original ii lform, or repacks it under own brand (in 16kg tins or 5lt PET) Consumer motivators: Better prices than retail market Trustworthy link due to personal relationship developed over the years to acquire product
18 Sales Channels RETAIL Smallest segment due to: High availability to anyone outside retail market Steep price difference in comparison to other channels Offers all sizes ranging from 250ml to 16kg tins. Nevertheless, most outlets will carry 2 brands and 2 3 sizes per brand (excluding key accounts which have more selection) Consumer motivators: Easy access Cleanliness
19 Sales Channels DEVELOPMENT OF SALES CHANNELS Drastic change in method of purchase expected in upcoming 10 years: Strong trend dtowards smaller packaging More practical Purchase power problem Purchasing power will continue to decrease Cost of living always more expensive Increase in salary not enough Unemployment problem New regulations will make it harder for wholesalers to sell own olive oil Not allowed to sell white tins in the market New regulations for customer protection will be issued.
20 Sales Channels DEVELOPMENT OF SALES CHANNELS Development of the retail sector Still at the beginning i of the road Modern trade will take over on wholesale Decrease in small shops Consumer enjoy the shopping experience
21 Thank You.
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