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Greater Food Brand Loyalty is Linked to Food Transparency

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According to a retail food study, consumers showed a higher incidence of brand loyalty to food products that generate a deeper connection via transparency. As much as 75% of shoppers are more than ready to switch brands when confronted with a product that has a more detailed label. The new study shows that shoppers are getting more demanding when it comes to food transparency.

Inside the Report

The report was developed by the Food Marketing Institute (FMI) with the purpose of outlining how shoppers define transparency and how it influences their food buying behavior. The report is known as The Transparency Imperative. According to the CMO, “We titled this report The Transparency Imperative because as we executed the research to bring the key findings of our 2016 studies current, we see clearly that transparency is only becoming more important to consumers.”

The paper looks deeply into the behavior and attitude within shoppers who are health-conscious as well as those who are digitally-active. It also looks into the response of consumers across different ages.

Targeting these varied consumer demographics, the study offers various and needed steps that brands should look into to further show their commitment to transparency; to track the ever-changing scenario of consumer preferences; to meet the ever-increasing expectations of food-buyers; to comprehend the exact needs of essential groups of buyers; and to transmit data over and beyond the list of ingredients.

The Results Show Brand Loyalty for Transparent Brands

 

As much as 86% of the correspondents agree that food retailers and manufacturers that provide a gateway to easily look-up their products’ ingredients definitions are easy to understand and complete—would lead to greater trust from them.

Further, a staggering 80% commented that they would definitely be more loyal to a brand that offers a significant amount of data on their products, more than what’s usually contained in the product label.

Lastly, more than half of the correspondents, 54% to be exact, would pay more for products with this included information.

Defining Transparency

According to Generation X and Baby Boomers, transparency is directly linked to nutritional information, ingredient descriptions, and a complete list of ingredients. Millennials, on the other hand, have a more detailed expectation when it came to transparency. Aside from what the older generations have listed, they are more likely to focus on fair trade and labor practices, animal welfare, descriptions of ingredient usage data, claims and certifications as well as allergen information.

Health-Conscious Shoppers Committed to Transparency

As much as half of the households in America have an individual who follows a health-related diet. Making these households more likely to put a significant importance on transparency. In fact, as much as 89% of shoppers are more likely not to buy a food product when the label is not sufficient to meet their needs.

Further, households that have children have an increased tendency to lean toward transparency. As much as 87% of these households use their smartphone while grocery shopping to check product information while in store.

All these findings point to advocating transparency by food brands can lead to better consumer relationships, brand loyalty and profits. Natural food brands should look for simple ingredients that help create a transparent, clean label. Learn more about GrandFusion fruit and vegetable powders to add real vitamins and minerals to your products.

Watching The Moving Target On Consumer Preferences

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For several years already,  consumer preferences have placed importance on their health and wellness. In the recent American Bankers’ Association annual convention, Todd Hale noted that while people want healthy foods, they also want to indulge. Fortunately, there is a growing trend of healthy indulgent categories. For instance, favorite comfort foods such as pies and other specialty desserts have experienced growth according to Nielsen data.

Retailers Take Advantage of the Desire for Freshness

There is an increasing desire for consumers to eat sweet goods that are fresh. Most consumers prefer fresher products, and this fact is used as an advantage by retailers. Food manufacturers use specialized packaging on cakes, cookies, and donuts. Moreover, they also place these products around the store so that consumers can easily access them and not just go to the center store anymore to get them. Another strategy that retailers do is to use technology such as television screens to showcase their indulgent offerings.

Retailers know that consumers who are not afraid to indulge are likely to gravitate towards eating healthy. Jones-Barber from Dawn’s Bakers Truth noted that with the changing trend of people wanting to eat healthily, it is the role of food manufacturers and retail companies to deliver products that are healthy and also satisfies the indulgence of consumers.

Today’s Consumer Preferences Driven by Transparency and Truth

Aside from eating healthy, consumers also demand transparency and truth. This is the reason why many food manufacturers including Kroger are now jumping on the bandwagon for organic brands that come with clean labels. Consumers are now opting for food products wherein they know what they are made from or where they come from.

To date, there is a multitude of food manufacturers that create products with clean labels. Health-conscious individuals are also leaning towards products with a clean label because they are deemed healthier as they don’t contain preservatives, additives, and synthetic color and flavor.

Health and Wellness is a Moving Target

While it is easy to say that food manufacturers should focus on creating healthy products, it is often considered by food manufacturers as a moving target. The thing is that the term “health and wellness” can mean different things to different consumers.

Food manufacturers still need to define what their consumers think about “health and wellness.” Consumer feedback is essential for food manufacturing and retailers to address the needs of their consumers. This is the reason why there are so many products like trans-fat-free, sugar-free, and other ingredients that make a particular product more appealing to health-conscious consumers.

The ever-changing preferences of consumers make food manufacturers adapt to the ever-changing needs thus creating a wave of food trends along the way and demanding innovation from food manufacturers. And because it is a moving target, it can move quickly to new challenges and trends are created now and then.

Inspired by www.foodbusinessnews.net

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Scott Gottlieb’s FDA Will Continue to Push Food Transparency Measures

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Reading Time: 3 minutes

With the focus on deregulation by the Trump administration, many food industry experts worried that the newly appointed commissioner of the FDA, Scott Gottlieb, would roll back pending changes to nutrition labels and consumer information. However, at a recent conference, Gottlieb made it clear that the FDA is going to continue to push for food transparency with Nutrition Facts, labeling, and definitions playing a significant role in the agency’s new nutrition innovation strategy.

Improving the Health of Americans Through Food Transparency

At the National Food Policy Conference in Washington, D.C., Gottlieb let everyone know that the nutrition innovation strategy is meant to improve the health of all American regardless of socioeconomic status.

“Our challenge is to help create more healthful choices and foster inovation and competition, and also make these choices more afordable.” – Scott Gottlieb, FDA Commissioner

A study found that 20% of American deaths in 2015 could be attributed to poor dietary factors. Gottlieb made sure to emphasize the importance of research and facts on everything his agency does. He said that clear science-based information is the central pillar of the work we do at the FDA and is essential to helping drive better consumer choices.

Nutrition Facts Labeling Updates

 

Gottlieb indicated that the new Nutrition Facts labeling initiative is of the utmost importance, but he wants to make sure it is right. He wants to roll out the new label with a consumer educational campaign to help the average American better understand how many calories they should be consuming each day.

On top of the new label, he promised to handle the definition of “healthy” and “natural” for labeling. A core definition of “healthy” is critical to help consumers better understand what they are buying. The new definition will consider nutrient content. Consumers also want more clarity on “natural” which has never been defined by the NDA. While Gottlieb did not offer up much on this definition, he did indicate that it will need to be science-based.

Streamlining the Labeling Process for Food Manufacturers

Gottlieb believes the regulatory labeling process is currently too lengthy and time consuming for food manufacturers. He has added to his docked to streamline the labeling process to modern times. He wants it to be easy for consumers to understand the health benefits of a product.

He wants to make it easier for the food companies to clean up their labels. Interestingly, he used vitamins as an example since they typically appear by their chemical name on the ingredient statement. We believe it should stay this way as most of these vitamins do not come from whole food sources and are chemically derived. Our GrandFusion products concentrate these natural vitamins from fruits and vegetables and as a result, allow products to use a much cleaner ingredient statement.

Conclusion on Gottlieb’s Remarks

The FDA is overall in good hands with this Trump appointee. He is committed to pushing forward all of the Obama-era regulations and making decisions on scientific fact. He believes some of the processes in the FDA are archaic and need updating to work faster in today’s environment. It will be interesting to see all the changes that move forward under Scott Gottlieb’s leadership.

Inspired by www.fooddive.com

Top 7 Food & Beverage Industry Predictions for 2018

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Reading Time: 4 minutes

What can we expect for the year 2018? What do you think the food and beverage industry will bring to our dining tables this year? You may have a lot of questions, but one thing is for sure, delicious and healthy improvements are in the forecast. Concentric, a leading marketing and branding agency, curated the top seven food and beverage industry predictions for 2018. Let’s take a look!

1 – Instagrammable Food Packaging

Is it “Instagrammable?” If it is, then most likely the food or beverage product will be shared by thousands, if not millions, of people on social media. Free and instant exposure—and this makes it a good selling point for manufacturers. Concentric expects to see an upsurge of carefully organized breakfast bowls that may be too appealing to destroy. And of course, brands would delve into the heightened aesthetics of their packaging.

2 – Light Snacking

Small, frequent feedings have been a slogan of a lot of diets which has led to the rise in snacking. Shoppers’ search for light snacks has been in full swing for the past few years. This year will be a bit different with food manufacturers rolling out “light” snacks and drinks, instead of the outdated and overpowering flavors. Food and drink producers are now geared for lighter tasting options like floral enhanced waters, less sweetness, less alcohol, and lighter ABVs as a whole.

3 – Exotic Flavors

More and more US consumers are embracing various ethnic flavors. As the American palate becomes more and more accustomed to International dishes, newer flavors are being introduced in the market. Think in the lines of za’atar, harissa, tahini, falafel, and pita to name a few.

4 – Plant-Based Still Going Strong

While this trend is nothing new, the innovation and technology behind this growth are evolving. The direction of going plant-based is growing by leaps and bounds with introductions like plant-based egg substitutes and veggie burgers. Also, think of foods in the lines of jackfruit and zoodle pasta dishes.

5 – Natural Processing

 

A lot of diets debuted in the past few years totally eliminated processed foods in the diet. So, this may not be new but naturally-processed foods will be a big hit in 2018. We are slowly evolving into the mindset of “less is more.” And this is the niche where smaller companies can explore and seize opportunities by being able to deliver naturally-processed, no-preservative, and higher quality food.

6 – Sustainability and Sourcing

We’ve heard a lot of phrases like farm-to-fork, farm-to-plate, sustainable sourcing, local sourcing, fair coursing, etc.—all these means sourcing and sustainability practices. The food industry is reducing their footprint while making food fresher longer and saving money. It is seen that the food industry is looking into kelp and seaweed for a more nutrient rich and sustainable food option.

7 – Transparency

This has been an age-old fight between consumers and producers, but it is seen that in 2018 food manufacturers are more than ever going to strive harder for brand and food transparency or else risk losing their market. 2018’s consumer is more probing and meticulous when it comes to their food than ever.

Final Thoughts on Predictions

2018 is going to be an important year for the food and beverage industry. Many of the new products and reformulations have been in the works over the past 18 months and their launches will be critical. Be on the lookout for products utilizing multiple trends mentioned above to attract consumers. A variety of products with GrandFusion launching in 2018 will pair plant-based and light snacking trends together. These superfood snacks will pack a nutritional punch from GrandFusion’s plant-based vitamins without impacting the flavor or texture. Interested in learning more? Download our GrandFusion R&D Resource Kit.

CFI Finds Only 33% of Consumers Trust The Food System

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Reading Time: 2 minutes

The Center for Food Integrity (CFI) released a new study, A Dangerous Food Disconnect: When Consumers Hold You Responsible  But Don’t Trust You, that looks at some damaging statistics on the food system. First and foremost, the study revealed that 33% of consumers do not trust the food system, which is down from 47% in 2017. This is alarming and further supports the movement by food companies to be more transparent and create products with simple ingredients.

Food Companies Placed Last on List of Most Trusted Information in the Food System

The new CFI study is important because it showcases the disconnect between what consumers think and what food companies across the industry are actively doing to ease their concerns. On the list of most trusted sources for food safety information, food companies ranked dead last with food regulators taking 8th on the list, and farmers ranking 3rd on the list. Surprisingly, family and physicians ranked as the most trusted sources of food safety information.

 

Roxi Beck, Director of the CFI, believes food companies have to further their mission of product transparency. She suggests inviting consumers to the farms and manufacturing facilities to build more trust. She also suggests large CPG companies be wary of touting their large size and global scale as it often viewed as a warning sign to consumers today. The small brands are taking advantage of this and winning big time.

Investing in Transparency Efforts and Technology

Multiple food companies and suppliers in the food system are looking at new blockchain technology to lead the transparency effort. Companies like Cargill have tested blockchain to allow consumers to trace their Thanksgiving Turkey back to the farm it was raised on. This is a step in the right direction.

Other companies are looking for ways to better tell their brand stories to lead transparency efforts. Marketing teams across food brands are selling this hard up the ladder because they know how important trust is to purchase decisions and long-term brand loyalty. The bottom line will grow as food companies and their brand focus on building more trust with consumers.

Inspired by www.fooddive.com

Small Manufacturers Are Experiencing Large Growth

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Although almost $3 billion in losses took place in U.S. retail during the first quarter because of a shift in the timing of Easter as well as changing consumer preferences, growth is not impossible. Contrary to what the numbers show, a few small food and beverage manufacturers are thriving during an unexpected time. Only five years ago, the largest food and bev manufacturers represented one-third of all dollar sales. However, to date, they account for only 31%, and smaller manufacturers (which exceed $100,000 in sales annually) have gained the two percentage points of market share, valuing at about $2 billion. Currently, nearly 16,000 companies, which make up the smallest manufacturers, are responsible for 19% of dollar sales and are also experiencing over half of the growth (53%).

For Full Article and Results From Nielsen, please visit: http://www.nielsen.com/us/en/insights/news/2017

Transparency is Now Key to Consumer Approval

Research put into the shift of growth in the U.S. retail industry shows that transparency is winning. Small manufacturers place a significant portion of their focus on health as well as the need to provide a transparent environment for consumers. At the same time, they do well to maintain an exceptional price point that retailers love!

Clean Labels Gaining Popularity

A “clean label” refers to a product that does not contain any artificial sweeteners, preservatives, colors, and flavors, as well as antibiotics and hormones in beverage and food categories. These products also typically make marketing label claims on their packaging to entice consumers.

As shown in a worldwide ingredients survey conducted by Nielsen, consumers have a tendency to keep a close eye on the details of products―actually, nearly three-quarters of survey participants said they felt positively toward businesses dedicated to honesty regarding their product sourcing; 68% were willing to spend more money on beverages and food free of ill-favored ingredients; 64% of the diets of consumers forbid specific ingredients. The longing for clean labels stems from the growing desire for company transparency.

 

Clean label products are now responsible for 30% of sales in the market, which has grown by 5.6% over the last five years. Small manufacturers dominate large competitors regarding clean label sales and growth. This past year has shown that small manufacturers sold the most share of clean label products in comparison to their other sales. Small manufacturers led with 40% of their sales coming from clean labels, followed by middle-sized manufacturers at 38%, private-label manufacturers at 27%, and lastly, large manufacturers at 24% of their sales coming from clean label products.

Small manufacturers take the lead in premium price tiers as well. Recently, premium-priced sales made up 44% of small producers’ sales, a significant difference when compared to the premium price of the sale of large manufacturers, recorded at 39% and below.

During the last five years, both medium- and small-sized manufacturers have upped their distribution throughout regions, resulting in a greater amount of space inside stores. Out of the roughly 900 beverage and food items that have been stock on store shelves since 2013, 88% came from medium- and small-sized companies. Retailers are giving small manufacturers an opportunity to sell their products to customers more frequently than ever before.

Increasing Sales with Promotion

Due to a larger variety and connection to real consumer desires, smaller and private manufacturers are finding sales success while also spending less on the promotion of their offerings. Larger corporations, on the other hand, have spent much more money than average on trade promotions. As of April 2017, sales based on advertising are accredited to 40% of large manufacturers’ sales, compared to 27% of small manufacturers’ sales.

 

As the demand for clean label products increases, more and more people will be willing to buy them, whether or not there are promotions. To adapt to the smaller manufacturers taking advantage of this trend, retailers and marketplaces must provide more space in order to account for the consumer demand. The long term success of this trend is still undefined. We will see how large brands respond. The most consistent way to adapt for large companies is through the acquisition of small manufacturers.

Inspired by www.nielsen.com

Clean Labels: From Trend To Movement

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Today’s consumer is more interested in eating fresher and cleaner foods. Industry experts have noticed that many food companies have adopted the movement for cleaner foods.  Companies like Campbell’s Soup and PepsiCo have implemented food transparency through clean labeling. There is also a rise in food start-ups applying clean labels with their new products.

Chief Marketing and Innovation Officer, Suzanne Ginestro from Campbell Soup, noted that modern consumers are moving towards cleaner labels, transparency, as well as opting for products that are healthier and have ingredients that are easier to understand. People want transparency on all kinds of products from household cleaning supplies to electronics. Consumers just want to know what is inside the products they are using.

Why Transparency And Clean Labeling? 

So why are people so particular about clean labeling and transparency? Becky Frankiewicz from Quaker Foods North America indicated that consumers want to have more choices and this can only be achieved if they know the ingredients of the products they are buying.

While clean labels promote companies to indicate all ingredients on their labels, it does not mean that they should only focus on healthy ingredients yet. Companies have adopted the clean label movement to prove that they care about their consumers and their products. It also enables consumers to make informed decisions about their purchases.

Some food manufacturers still include ingredients that will make their products more palatable and that means using fat and sugar. The clean label is there to educate consumers about the types of ingredients utilized in the product. It is all about giving customers access to different food choices.

Clean Label: Trend or Movement?

What started out as a fad has become a movement that will surely stay. Today, many food startups have found success in introducing healthier foods and beverages to consumers. Large food companies are also capitalizing on the opportunity by introducing healthier product choices to their customers. Executives from large food manufacturing companies noted that the clean label movement had pushed brands to go back to their old business practices.

For instance, the 140-year old company Quaker Foods first started using fresh ingredients and developed ways to package their products so that it is easier for the consumers who live in urban places to enjoy healthy foods—similar to those living on the farm.

From trend to movement, clean labels are here to stay. Brands that focus on delivering healthy food with simple ingredients will win, plain and simple. Don’t be surprised to see more acquisitions of small, successful brands over the next five years as large companies like PepsiCo try to a secure a competitive advantage in this evolving space.

Inspired by fortune.com

Food Product Transparency Impacts Purchase Behavior

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Consumers today are smarter, as they demand food product transparency when it comes to items they buy in the grocery store. The request for transparency is influencing the evolution of the food industry as it requires many food manufacturers to provide consumers accurate and detailed product information.

According to the 2016 Label Insight Food Revolution Study, most consumers value the transparency of goods since it forms some of the data points that they consider when making a purchasing decision. The report also indicated that most consumers do not trust the information provided because of the way many brands deliver it on their products. The study was conducted by Label Insight, a global leader in providing SaaS data solutions to empower the transparency between food brands and consumers.

 

What Did The Food Revolution Study Cover?

The study surveyed more than 1,500 consumers and identified how they made different food choices. The survey also covered consumer expectations from the food manufacturers in providing the product information. Recently, many users have developed high expectations when it comes to the transparency of ingredients in the food that they consume.

CMO of Label Insight Patrick Moorhead indicated that the high demand of food product transparency from the consumers is pressuring the industry players and even small food manufacturers to finally provide the information that the consumers require—not only to create better spending decisions—but also to avoid customer confusion and highlight many opportunities that food manufacturers have in innovating their products.

 

Why Is There a Need for Food Product Transparency?

Food product transparency solves different issues not only within the food manufacturing industry, but also to their consumers. The most important reason for transparency is to eliminate customer confusion. Label Insight’s report revealed that 81% of the consumers admitted to consumption of packaged food products that contained ingredients they do not recognize.

Confusion also affected the purchase decision of many consumers. In the study, 94% of the respondents admitted that they did not know the ingredients in their food, which makes it difficult to make an informed decision. In fact, 83% mentioned that companies that provide food product transparency are more valued by consumers which, in turn, promotes consumer loyalty. Consumers are more likely to switch to brands that provide detailed information on their products.

 

The Repercussions

Many retailers are pressed with high demands from consumers in terms of providing food product transparency. Food manufacturers cannot simply ignore such demands as many see their customers turning to their competitors. This movement presented many opportunities for emerging brands to gain a chunk of the market and secure loyalty from the dismayed or discouraged consumers.

Brands are always in a position to develop ways to improve the long-term relationship with their customers. Food product transparency is another form of the clean label movement, and it is essential to success over the next ten years.

Inspired by bizjournals.com