What Consumers Really Want from Food Companies

Consumers tastes in food have changed dramatically—creating tremendous opportunities for food and grocery innovators while punishing traditional packaged food processors.

The global processed food and beverages industry is dominated by a handful of multinational corporations. Among the leaders are Unilever, Cadbury Schweppes, Kraft Heinz, Mendelez International (formerly part of Kraft), General Mills and Nestlé. Unilever, for example, estimates that 150 million people per day purchase its products, ranging from Knorr soups to diet meals, in 150 nations around the globe.

However, the soaring success of innovative new companies that provide alternatives to tired, old traditional foods is turning the global food industry upside down. Today’s consumers have changed, and the food industry is being forced to follow.

Consumers are worried about nutrition, the source of ingredients, the effects of chemicals on their bodies, and in particular, the safety or health values of the food they give to their children. In nations and regions containing middle to upper-income consumers, this is nothing less than a food industry revolution in the making.

Many new companies have arisen to take advantage of these trends, and they have often seen tremendous growth. Amy’s Kitchen, for example, a relatively new company focused on frozen dishes, makes products positioned as organic and vegetarian, and sometimes “light & lean.” Packages contain symbols denoting certified kosher, soy free, lactose free, gluten free, light in sodium or low fat, depending on a particular item’s attributes. The company’s ingredients are non-GMO, which appeals to many consumers.

Perhaps the most successful large company focused on taking advantage of these trends is Hain Celestial. It has a goal of growing to $5 billion by 2020, by continuing its rapid acquisition of smaller food companies that satisfy today’s consumer interests.

And, the most newsworthy newcomer at the moment is Beyond Meat, which recently launched its stock IPO and is riding the rapidly growing popularity of vegetarian fare with its Beyond Burger and Beyond Sausage high-quality meat substitutes. In fact, vegetarian menu items and processed foods are gaining significant market share in stores and restaurants.

Today, food companies are in full combat mode, redoing recipes and reducing long ingredient lists, while purchasing aggressive younger companies that better suit today’s trends, and attempting to evolve their marketing to appeal to the evolving interests of consumers. Many consumers prefer foods that do not include a high number of chemicals, flavorings and additives. Consequently, foods that feature fewer ingredients overall are highlighting that fact on packaging, instead of burying ingredient lists under mandated nutritional information (e.g., CB’s Nuts Peanut Butter with one ingredient only). Kraft, for example, is removing synthetic colors and artificial preservatives from its mac and cheese products. A long line of restaurants and food companies have announced that they are migrating to using chicken and other meats that have not been raised on feed that uses certain antibiotics. Tyson has announced it will no longer feed its chickens with human antibiotics. Hershey is removing artificial ingredients from its milk chocolates. This isn’t merely a trend, it’s a mass migration of packaged food firms struggling to plug big holes in their leaking ships.

Consumer-Driven Trends in Food and Beverages

1) Reduced sugar content
2) A growing avoidance of artificial sweeteners
3) High demand for organically-grown fruit, produce and grains
4) High demand for whole grains, “ancient” grains and heirloom-style vegetables
5) Demand for humane treatment of farm animals (cage-free chickens, free-range grazing animals)
6) Growing demand for dairy-free food and drink substitutes, such as soy milk and almond milk
7) Demand for locally-sourced foods and farm-to-table produce
8) A continuing backlash against genetically modified crops and ingredients
9) Demand for fresher foods in general, with fewer chemical additives such as preservatives
10) Demand for craft beers, artisanal alcoholic beverages and gourmet wines
11) Increased market for healthier snacks, “functional” foods or foods with nutritional benefits
12) Lower consumption of soft drinks, with waters, teas and juices as alternatives
13) Strong demand for gourmet coffees
14) Reduced demand for highly processed, packaged foods (e.g., more consumption of home-cooked oatmeal instead of packaged cereals)
15) Reduced interest in restaurant menu items that appear to be based on highly processed, unhealthy, frozen or chemically-treated ingredients
16) High demand for low-carbohydrate menu items in restaurants
17) Growing avoidance of certain foods, such as gluten, peanuts, shellfish or soy, due to perceived intolerance or allergies
18) Demand for increase food safety procedures
Source: Plunkett Research, Ltd.

Plunkett’s Food Industry Almanac 2019

Everything you need to know about today’s food industry!


Available to Plunkett Research Online subscribers
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Publication Date: March, 2019 | Price: $379.99
Printed ISBN: 978-1-62831-487-8
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