Consumer trends drive change

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In order to optimize business performance over time, you must track consumer trends. It doesn’t matter what you produce or where you fall in the food-value chain, consumers direct change. 

Recent examples of consumer-directed change include:

  • White meat of chicken. In the late 1970s, as fast food/quick-service restaurants started to become a force in the foodservice market, their two primary chicken products — nuggets and chicken-breast  sandwiches — led poultry breeders to start breeding for birds with a higher proportion of white meat.
  • Single-serve flavored milks. In the past couple of years, the popularity of single-serve-packaged “grab and go” beverages has finally reached the dairy case. Although the trend was signaled at least a decade earlier, the explosion of new flavors and package formats has only hit the dairy market recently.
  • Cheese. With the popularity of high-protein, high-fat, low-carbohydrate diets, cheese and other dairy products are poised to benefit. The NPD Food Group estimates that as many as 25 million Americans follow a low-carbohydrate diet.

     The table below illustrates how just a few foods have been affected by recent shifts in consumer spending because of the popularity of low-carb diets.

The latest trend
If you stop and think about it, you can probably come up with several consumer trends developing right now. The one capturing enormous media attention (and given recent litigation, the full attention of those in the food / beverage manufacturing and service sectors), is the rising level of obesity in the U.S. population. 

Obesity is a disease, defined by an imbalance between energy intake and output with the accumulation of large amounts of fat. The Centers for Disease Control and Prevention report that 44 million U.S. adults can be classified as obese (according to the body mass index). Obesity rates have increased by 74 percent since 1991.

In addition, the number of small children who are overweight has doubled since 1980; for adolescents, the number has tripled. Based on data from the Centers for Disease Control and Prevention, more than 15 percent of children aged 6 to 19 are overweight.

The choices that consumers make drive all change in the food industry. And, some would argue that it has been consumers’ demand for quick, on-the-go foods — which the food industry developed to meet demand — that has lead to our ever-increasing waistlines.

To see the connection between consumer trends and the impact on producer profitability, take a look at the egg industry. Recently, egg sales have benefited from the advent of the Atkins Diet and America’s obsession with low-carb diets — fueled, in part, by our increasing number of overweight people. And the price for eggs, a cheaper source of protein than beef, hit a $1.40 per dozen in mid-December — a 20-year high. However, this isn’t the first time the egg industry has seen a consumer trend drive change in the industry. About 30 years ago concerns about cholesterol battered egg sales.  

Stay well-informed about consumer tastes and trends. It can have a dramatic impact on your future success.

Laura MacPhail, Principal with the Hale Group, Ltd. Boston, Mass.



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