Taste, price, and convenience are not the only deciding factors for purchasing food. A study by Deloitte, the Food Marketing Institute, and the Grocery Manufactures Association (GMA) found a host of other influences that are increasingly becoming common.
The study, entitled “Capitalizing on the Shifting Consumer Food Value Equation” found that roughly half of Americans surveyed (51 percent) weigh “evolving drives” of health and wellness, safety, social impact, experience, and transparency in their purchasing decisions in additional to the traditional drivers of taste, price, and convenience. This shift provides both challenges and opportunities for manufacturers and retailers, the report said.
In each region of the United States studied–Midwest, Northeast, South, West,–the divide between consumers with traditional drivers versus those whose drivers are evolving are all roughly half, with the Midwest having a slight majority for consumers with traditional drivers (51 percent) and the West leading with a slight majority in consumers adapting new drivers (54 percent). Age group and socioeconomic class was not a fragmentation force in the divide between traditional and evolving drivers.
“Contrary to conventional wisdom, it is not just the millennials or the most affluent putting these evolving drivers in the mix,” said Jack Ringquist, principal, Deloitte Consulting LLP and global consumer product leader.
“Our research reveals that the preference for these attributes does not differ by generation, income level or region, but is pervasive across these groups. The U.S. consumer has changed in a fundamental and impactful way, and people’s preferences are becoming even more fragmented than the food industry may have anticipated,” Ringquist said.
The study also showed a shift in the way people think about food safety. Americans no longer define the concept of food safety based on near-term risks to their health. Instead, 74 percent of consumers believe that a definition of food safely limited to “one that will not cause any immediate, physical harm” is insufficient. Consumers now link health, wellness and transparency with their definition of safety, and include factors such as free from harmful ingredients (62 percent); clear and accurate labeling (51 percent); and fewer ingredients, processing and nothing artificial (42 percent).
As consumer tastes change, so does the market environment. A Credit Suisse report said that the top 25 branded food manufacturers lost 3.5 percent market share from 2009 to 2013. In addition, consumer trust, as reported by Deloitte’s 2014 Social Media Survey, found that consumers are 3.4 times more likely to harbor negative sentiment about food companies than a cross-industry average.
The “research clearly highlights a seismic shift in what consumers expect from the food industry. And, these changes will require a response of equal magnitude from retailers and manufacturers to help meet consumers evolving needs,” the report concluded.
For further information about the study, click here. For the complete study, click here.
