Dive Brief:
- Researchers from the USDA's Economic Research Service and the University of Georgia recoded and defined the food sources used in federal dietary surveys conducted between 1977 and 2012 to be consistent across the decades of survey data. This recoding revealed long-term consumption habits, particularly regarding consumers eating at home versus away from home.
- The percentage of calorie intake consumed from at-home food (such as from grocery stores) fell from 80% in 1977-78 to 65% in 2011-12. Meanwhile, the share of calories consumed from food away from home (FAFH) increased from 17.8% in 1977 to 33.8% in 2006.
- During the 2007-2010 recession, consumers ate more food at home rather than shifting to lower-cost FAFH sources. But once the recession was over, the FAFH and fast food calorie intake made a comeback.
Dive Insight:
It's clear then why convenience and snack-friendly foods and beverages are becoming such a major focus for manufacturers' portfolios and R&D efforts. This spans categories across the industry, well beyond traditional snack foods. A variety of manufacturers have also made strategic acquisitions in these categories, such as Hormel and nut butter snack maker Justin's.
Healthy snacks and convenience foods, such as packaged salads and meal replacement beverages, are especially benefiting from consumers' demand for convenient products.
When cost is a factor, as it was during the recession, consumers tend to choose at-home food over eating out. This demonstrates the importance of grocery store products remaining competitively priced compared to each other and FAFH sources. Smucker recently announced its second price reduction for U.S. retail coffee brands in less than a year after facing significant backlash and sales declines when the company increased prices to in 2014.
Balancing competitive pricing with profitability may also be a challenge as manufacturers switch out certain ingredients for better-for-you and more natural alternatives that may carry a higher price tag. However, surveys from Nielsen and Consumer Reports found that consumers would be willing to pay more for "healthier" and natural foods.