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CHICAGO, Feb. 10, 2010 - The consumer packaged goods (CPG) industry has done a commendable job of responding to consumers' intensifying drive for value. As illustrated in the IRI Times & Trends Report: "Price, Promotion & Merchandising: Balancing the Call Between Value and Price Relief," efforts to bring value and price relief to consumers have increased during the past year. Pricing and merchandising strategies have been at the center of these efforts, with pricing-cutting becoming common practice, and display activity rebounding from a multi-year slide. The latest IRI report explores these current and emerging trends that define CPG marketer attempts to serve and satisfy consumers in a recessionary period.

"In the midst of it all, an interesting conundrum has arisen for marketers," says IRI Shopper Marketing and Innovation President Thom Blischok. "Today's shoppers are approaching promotional fatigue. They want more than temporary price relief; they want value that is here today and will remain tomorrow."

Given the complex nature of the economy and the turmoil that has been seemingly omnipresent during the past two years, tomorrow is not all that easy to predict. One issue is commodity and CPG prices. Analysts seem fairly certain that the country's recent deflationary period is coming to an end. At the same time, it is very unlikely that the drastic price increases experienced during the last few years, such as the 15.9 percent increase in shelf-stable seafood, the 13.9 percent increase in margarine/spreads and the 13.6 percent increase in rice, will occur. Tomorrow's CPG prices will fall somewhere in between.

Consumers have undergone a stark metamorphosis during the course of the recession, with the home once again becoming the nucleus of daily living, and self-care becoming the mantra for health, beauty and home care. The meaning of affordability has become much broader and deeper. For instance, 92 percent of consumers think overall quality is an important factor in product selection, while 87 percent consider price and 83 percent choose products they trust, according to an IRI consumer survey.

The CPG industry has reached a critical juncture. Going forward, pricing and merchandising strategies will play an increasingly critical role in providing value to shoppers. Targeted programs based on sound consumer knowledge are a recipe for growth and for building loyalty with shoppers.

The most successful strategies will be those that address consumers' pre-planned shopping behaviors. Even though the economy is showing signs of improving, 73 percent of shoppers make a shopping list before going to the store, 61 percent of shoppers look at store fliers and 53 percent of shoppers stock up on certain items because they are on sale. These numbers have changed very little since late 2008, when the recession was in full swing. So, CPG marketers need to connect with shoppers in the home. Messaging must be relevant and persuasive. In-store efforts must close the loop, ensuring that decisions made at the shelf are favorable.

"Change is continuing to occur at an alarming rate," adds Blischok. "Marketers must remain vigilant and strive to anticipate the evolving needs and wants of consumers. Innovative and well-executed marketing strategies will be the hallmark of best-in-class CPG companies in the coming year."

About the Report

The IRI Times & Trends Report: "Price, Promotion & Merchandising: Balancing the Call Between Value and Price Relief," is available from IRI, the leading global provider of consumer, shopper, and retail market intelligence and insights for the consumer packaged goods (CPG), retail, and healthcare industries. The findings of this report were compiled based on IRI Shopper Insights Advantage, IRI In-Store Solutions Suite, IRI Controlled Store Testing, IRI Price Advantage and IRI Trade Advantage. To download the special report, visit http://us.infores.com/page/news/times_and_trends.

About Information Resources, Inc.

IRI is the world's leading provider of consumer, shopper, and retail market intelligence and insights supporting 95 percent of the FORTUNE Global 500 consumer packaged goods (CPG), retail and healthcare companies. Only IRI offers the unique combination of integrated market information, automated and predictive analytics, innovative enabling technologies, and domain expertise. With IRI, leading retailers and manufacturers are able to quickly discover breakthrough insights driving smarter decisions and actions across the enterprise for breakthrough results. Companies around the world depend on IRI for improved productivity, stronger brands, and dramatic revenue growth. For more information, visit http://us.infores.com.