• The Acheson Group

Evolving Consumer Values Changing the Game for the Food Industry

Updated: Nov 22, 2018


Evolving Consumer Values Changing the Game for the Food Industry

Historically, consumers have made food-purchasing decisions based on traditional value drivers: taste, price, and convenience. While these continue to be important, a new report, Capitalizing on the shifting consumer food value equation from Deloitte Consulting in collaboration with the Food Marketing Institute (FMI) and the Grocery Manufacturers Association (GMA), shows there are evolving values that are changing the game for the food industry.


Because these evolving values extend across regions, ages and incomes and are of vast significance to everyone in the food chain, this week’s newsletter focuses not just on the report – compiled from a survey of 5,000 consumers, interviews with 40 food industry, and FMI, GMA and Deloitte research – but on its significance to the food industry.


The Evolution

The evolving drivers cited in the report include health/wellness – “good for you” foods (nutrition as well as factors such as organic, natural, etc.); safety (food safety as well as accurate labeling); social impact (e.g., fair treatment of workers, local sourcing and involvement, environmental responsibility, etc.); and experience (at retail as well as brand engagement) – with transparency wrapped around it all, based on consumer desire for widespread access to information about their food – in real time.


But even while consumers are seeking open transparency by food providers, they have an unprecedented ability to access and share information through social media. Which means that if you’re not telling consumers what you’re doing, you can be sure there is somewhere else out there who is – and their version may or may not be the message you want to send, or even be fact. Additionally, it is the consumers who place high value on the evolving drivers who are most likely to use social media and other virtual sources for their brand information. Thus, it can be seen that these consumers are gathering their information about a food, a brand, and the industry from virtually anyone – except the industry itself. This is particularly true of Millennials, and – no surprise – 43% of them say they don’t trust large food manufacturers.


Another study finding of which the industry should take particular note is that of the increasing influence the retailer has on consumer purchases. This is especially important for large business, as it is the 25 largest U.S. food and beverage manufacturers who are seeing the lowest annual growth (average 1.0%), with faster growth being seen by smaller brands (4.9%) and private brands (4.0%).


The Impact

So what can – and should – the industry be doing to tap into this evolution and counter its negatives? To address some of the evolving values found to be important in today’s consumer decision making, the food industry needs to evolve its own values and actions. For example:

  • 81% of survey respondents said they are willing to pay more for healthier products, with more than one-fourth of respondents willing to pay 10% more or greater. Consider addressing the health/wellness of your product, marketing these aspects, and/or creating new “healthier” versions, even if it means you would have to charge more for the product.

  • 52% agreed with the definition of food safety as “one that will not cause any immediate, physical harm” – but they also felt something was missing in the definition. Today’s consumers see food safety in “a holistic, longer-term perspective,” including nontraditional factors such as clear, accurate labeling and ingredient/source information; limited processing and ingredients – with none being artificial; and even nutritional content – along with being free from harmful elements. Expand your own definition of and focus on food safety to address these areas.

  • Though it is a small group (representing 5% of the population) that considers the social responsibility of a company in making its purchasing decisions, it is a very vocal group with high purchasing power – and it appears to be growing. Expand your company’s social responsibility activities, and toot your own horn so consumers know.

  • Piggyback on the influence that retailers have on consumers by working together to create differentiation in the market. This can help you create a sustainable advantage.

  • At the same time, retailers can increase consumer trust by vetting the products they carry, and, again, making sure this information is easily and readily available to consumers.

  • Drive consumer trust by responding to the demand for transparency. FSMA is requiring that you know more about and validate your supply chain; use that knowledge to develop a consumer-facing story about what is in your food, where the ingredients come from, and how it is made.

Consumer values and purchasing decisions are definitely evolving, but the evolution has been occurring over time, and none of it should come as a real surprise, nor be a significant departure from good business practices as a whole. In fact, a focus on the big picture of transparency can naturally lead to fulfillment of many of the other values. The food industry has long held a closed-door approach to visibility, now is the time to change the game – open the doors; air your best practices; let your voice be heard.

About The Acheson Group (TAG)

Led by Former FDA Associate Commissioner for Foods Dr. David Acheson, TAG is a food safety consulting group that provides guidance and expertise worldwide for companies throughout the food supply chain. With in-depth industry knowledge combined with real-world experience, TAG's team of food safety experts help companies more effectively mitigate risk, improve operational efficiencies, and ensure regulatory and standards compliance. www.AchesonGroup.com

CONTACT US

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