- Increasingly, consumers are looking for more than just sustenance in their food and beverages. They want to discover something new and feel like it makes them a part of something bigger, an analyst from Innova Market Insights said at a panel at the Institute of Food Technologists show earlier this month, according to Food Business News.
- The number of global food and beverage launches with a claim that consumers will discover something increased 52% between 2016 and 2017. One in 10 European and North American consumers are driven by novelty and variety when buying food and beverage products, according to Innova Market Insights. Similarly social and ethical claims grew 20% last year from 2016, and packaging imploring consumers to “share” went up 50% from 2016 to 2017.
- “As consumers desire newness and variety, brands are using bolder flavors, bolder colors, novelty flavors, packaging and bringing in that element of surprise that gets consumers excited about the product and gets them buying over and over,” analyst Mindy Hermann said in Food Business News. “It allows people to create social media buzz so they feel like their own personal currency has gone up because they have something interesting and beautiful to share with their friends and family.”
As millennials continue to develop buying power, their tendency to eat out and experience specialty foods increases. According to a recent report by the U.S. Department of Agriculture’s Economic Research Service, millennials spend more than any other generation — around 6% of their food budgets — eating away from home. This pattern is changing the dynamic of the grocery store. Millennials' tastes drive trends in the grocery industry, with their high standards for quality, transparency, and brand stories changing the way that manufacturers are offering products.
In particular, millennials are interested in ethnic cuisine, especially in prepared foods. Looking at the increasing number of people with Hispanic and Asian heritage in this demographic, this should come as no surprise. A fascination for cuisine from other cultures, coupled with this age group's concern for healthy and sustainably sourced foods has led companies to increase their exploration into global flavors. Many are doing so by telling flavorful stories that spark curiosity. Consumers become especially interested in authentic international food when it also carries a health halo.
Industry experts say a larger selection of quality international foods helps retailers compete and attract a bigger shopper base. According to Statista, retail sales of ethnic foods will jump from $10.9 million in 2013 to an estimated $12.5 million this year.
At the same time, millennials also are interested in understanding the story behind a product, and they are willing to pay more for the transparency. A Nielsen survey from 2015 found 66% of millennials said they’re willing to pay more for sustainable products.
Although many consumers are looking for new and sustainable foods for their own enjoyment, many others are doing so to create social cachet. Brand stories and the lifestyles they cater to are a big force on social media, and manufacturers are looking to capitalize on this by encouraging people who purchase their products to share with family and friends both in person and online. Coca-Cola has a long-running campaign that encourages consumers to share the beverage with friends, family and even strangers they create memories with during the summer.
As many struggling CPG companies look for new ways to battle trendy upstarts and reverse sagging sales, there will be a growing focus on product innovation that resonates with the consumer. The challenge for many businesses, as it has always been, is to find a way to stand out from their competitors with a message that resonates with shoppers and leads to a meaningful boost in sales.