Packaged Facts Reports Stable Growth in the Natural Food Industry

Modern consumers are no longer driven only by the price and taste of food. With most consumers seeking healthy foods, their shopping behaviors have also changed. Today, American consumers consider safety, experience, social impact, transparency, as well as health and wellness when it comes to purchasing food. This is the reason why organic and natural foods are a growing niche in the food industry.

According to the report titled Natural and Organic Foods and Beverages in the US (5th edition), most consumers value the transparency and eco-conscious models of how their foods are made. Opting for natural and organic foods fulfill the needs of the customers.

Research Director of Packaged Facts, David Sprinkle, noted that this new behavior of consumers resulted in the rise of the organic and natural foods market. Packaged Facts estimated that the industry would earn $69 billion by the end of this year. This is 11% higher than the sales from last year.

The Industry Shift to Organic And Natural Foods

The growth of the organic and natural products has outpaced the sales of conventional food items. It is forecasted that the growth will be up to 70% from 2016 to 2021. This is the reason why big food manufacturers are shifting towards the natural and organic food niche. They hope to achieve this by overhauling their products or creating a new portfolio in the hopes of attracting consumers who lean towards natural and organic foods.

But what most big companies do not realize is that integrating organic and natural foods to their established brand can be quite challenging. While the market for organic food products is rising, it still has big shoes to fill. Conventional companies might find it difficult to look for clean ingredients because the suppliers are not quite there yet.

Big Food Companies Making Changes

Although there are some challenges present, investing in the natural and organic food niche is worth it. In fact, many big companies have seen stark improvements in sales after jumping into the natural and organic bandwagon.

For instance, Campbell Soup Co. announced to remove all artificial flavors and colors in its products by the end of 2018. Other companies that have plans to remove its artificial colors and flavors include Mondelez, General Mills, Mars Inc., Kraft Heinz, and Hershey Co. On the other hand, companies like WhiteWave Foods have pledged to use only organic ingredients in their products.

The food manufacturing industry has come a long way from using artificial flavors and colors in the past to using only natural ingredients. As consumer behavior continues to lean towards clean ingredients and healthy foods, the other main food manufacturing companies will follow suit–an action that will not only benefit food manufacturers but consumers as well.

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Trendsetter Foodies Define Trends Shaping Natural Food

Millennials are now the spotlight in the food industry. Brands and marketers are interested in their thoughts on the ingredients that could become the next big, natural food trend in the industry.

While conducting any study or survey regarding food trends, the “Trendsetter Foodie” group is supposed to be the most important as their choices could be game changers in future.  Packaged Facts has released a report that shows how millennials make up the single largest section of the Trendsetter Foodie population at 36% while baby boomers stand at 32%, which isn’t a wide margin. Food companies and retailers should take note of these figures because both of these demographics will influence the next big trends in natural food.

Trendsetter Foodies – Millennials and Boomers 

Millennials are young and have lower earnings, which means their buying capacity is less than older shoppers. The report said Trendsetter Foodies have a household income either below $50,000 or above $150,000. Millennials rule the roost in the former group while baby boomers the latter. But then again, if the general or non-Foodie population is taken into account, boomers and millennials have more or less similar choices regarding food. It is an interesting trend spotted among boomers which include anyone between the ages of 50 and 69 in the report. They are probably female, non-Hispanic white, live in relatively small households in smaller cities, towns or rural areas, and might not be employed full time. Even though calories aren’t their only concern, they are more likely to go on a diet on an ongoing basis to lose weight. Boomers don’t prefer gourmet, foreign and heavily spiced foods as compared to millennials. Unhealthy foods and those with artificial additives are a strict no-no for them.

A Wake-up Call for the Food Industry

Brands and retailers will do well to remember this vital segment of the market while messaging and designing food products. Trendsetting boomers and millennials like organic food but marketing items preferred by boomers, at first, could be more beneficial. As for retailers, implications for in-store messaging are a possibility just like targeted sale specials meant for boomers via weekly flyers. Millennials are essential but not the sole determining factor of natural food trends.

To put it in a nutshell, we can’t predict which way natural food trends will sway, which makes it all the more necessary to study and analyze the data correctly before significant decisions are implemented.

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