Consumer Trends for 2009
12/30/2008
Source: Food Processing
www.foodprocessing.com

By Diane Toops, News and Trends Editor

Health and wellness concerns were the overriding theme for 2008, and most consumers made a sincere effort to improve the eating habits of their families, albeit not always successfully.

As we head into 2009, the uncertainty of the global economic crisis is of great concern to all. At home in the U.S., now officially in recession mode, insecure consumers are worrying about their jobs, cutting back on their spending and assembling and eating more meals at home.

Fortunately for them, the cost of food is declining. U.S. food prices recently benefited from the plunge in corn, soybean and wheat prices (down about 50 percent) and the falling cost of energy – used to process, package and transport foods (down about 66 percent from record levels). But consumers could still wind up seeing a 4 percent increase in their grocery bills next year, according to the USDA.

Hope and optimism about the economy are seemingly in the air following the election of Barack Obama. So the question on all our minds is whether the economy will temper healthier consumer behavior and new product development from food companies as they grapple with prices and profits, or will American optimism and new-found confidence help to turn the tide. According to Chicago-based Mintel (www.mintel.com), there are five major ways consumers will adapt and businesses can thrive.

• You are in control: Consumers are more confident and demanding about how they live their lives and spend their money. Even in recession mode, they’ll want to stay in control of their choices wherever they can. They will seek out products and services that give them exactly what they want, when they want it, especially as their budgets tighten. And the Internet will be key, showing people every option available, giving them the power to demand more, while also allowing them to influence others through user reviews and feedback.

“Those companies that give consumers precisely what they want or give them the freedom to customize their purchases will do well,” says Joan Holleran, Mintel’s director of research. “Companies that fail to do this will see consumers walk away.” Baby Boomers will be of particular interest to businesses. Companies will move beyond traditional “old age” products and services to ones that embrace the active, healthy lifestyles of many older consumers.

• Simplify and purify: Faced with fast-paced modern life, consumers will continue to seek convenience and simplicity. As people take control of their everyday lives, they will also demand that companies communicate with them honestly and openly. From understandable ingredients to clear company practices, consumers want complete transparency when it comes to the products they buy.

Old-fashioned skills such as cooking at home and gardening will become increasingly popular. As an added benefit, these home-based activities will also help people stretch their budgets further.

Manufacturers will focus on clear ingredient labels and product, positioning fresh, clean and pure as essential values. “Brands that can communicate what they really stand for and show how they can make life easier will earn consumers’ trust and loyalty,” says Holleran. Additionally, with people “cocooning” in their homes to save money, companies will create better products for dining, relaxing and entertaining at home.

• Rebuilding trust: Today’s consumers have high standards and will demand value for money, as well as consistently high levels of quality, safety and service. Crumbling economic markets, food scares and toy safety problems have fueled an era of doubt and insecurity. And so in the coming year, people will seek out trusting, open relationships wherever they can. People want to know all about the products they buy, from where they were sourced to how they were manufactured. They will cling to the long-standing, nostalgic brands they know and love, looking

Look to the Future
Two ingredients could come and go in 2009 … stevia and salt/sodium, respectively.

Stevia-based sweeteners won an FDA non-objection in mid-December. Some are calling the extract from the South American plant the “holy grail” of sweeteners: It’s natural sweetener, it tastes like sugar and it has no calories. It’s been in use for years in South America and Japan, but most of Europe, like America, has not yet approved its use in processed foods and beverages.

U.S. approval appears certain. Look for European approvals in the not-too-distant future.
Reduction of “bad ingredients” will continue be a consumer priority, and the battle still rages against sodium. The food industry already has been removing or lowering salt from soups, breads, chips, baby foods, kid’s foods, juices, frozen foods and sauces. Some 663 products claiming “reduced sodium” were introduced in 2007, vs. 449 in 2006, and another 402 rolled out in the first nine months of 2008, according to Tom Vierhile, director of Datamonitor’s Productscan Online (www.productscan.com), Naples, N.Y.

It’s notable that Campbell Soup Co.’s reduced-sodium soups rang up some $650 million in retail sales in 2008, vs. $100 million in 2003. According to Lisa Walker, Campbell’s vice president of innovation, the lower-sodium soup line was deemed the top-selling new food product introduction of 2007 by IRI. Even Chicago-based Morton Salt responded to consumer desires by rolling out Salt Balance, a blend of salt (sodium chloride) and potassium chloride, with 25 percent less sodium than regular salt.

Lowering sodium is the real key, and there are more ways to do that than simply reducing the amount of salt. For instance, ICL Performance Products (www.icl-pplp.com), St. Louis, offers two grades of its leavening agent, Levona Opus and Levona Brio, allowing formulators to replace a key ingredient, sodium acid pyrophosphate, with calcium acid pyrophosphate.Now it helps food processors create products with less sodium -- and it adds calcium.

Nevertheless, there is at least one source calling for government intervention. “High sodium content is the single greatest problem in the American diet,” claims Michael Jacobson, executive director at the Center for Science in the Public Interest. “It’s welcome that some companies are lowering sodium, but what’s really needed is a government initiative.”