Consumers’ values are changing

Consumers are becoming increasingly discerning when it comes to the types of food products they purchase and are eager to know about food provenance, ingredients and the impact buying a product will have on the environment.

Markets are adapting, partly because they want to be more responsible, but also because they are being driven to do so by consumer demands.

Key areas where this is evident are in the areas of labelling, organics and the environment including sustainability and waste.

Grace Binchy, Insight and Innovation Specialist at Bord Bia, says that as part of the organisations PERIscope study, it was revealed that consumers find packaging and labelling hard to understand and navigate.

“Consumers are trying to eat healthier and they are looking for companies to facilitate them in that. 46 per cent of Irish consumers are often confused as to what they should eat to stay healthy. Checking nutritional labels is important to six out of 10 people but the language is often unclear for consumers.

“Packaging aesthetics are also changing – with packaging becoming increasingly cleaner, minimalist and simple in line with better ingredients in some cases,” she says.

Consumers view claims as important, 61per cent check claims but they are hard to understand as is food labelling. The challenge to business owners is to try to improve the language to make it as clear as possible. For “healthy” products it might say that the product is “raw”, or “only has five ingredients” but the product could actually have more sugar in it than its perceived less healthy competitor.

In terms of organic, in 2003 only 40 per cent of people have “ever bought organic”, in 2017 that figure increased to 71 per cent, a “significant increase” Binchy says.

“We’re seeing a growing range of organic produce and pricing has probably come down in some categories with growth in demand helping this.”

Consumers are saying they are more conscious of environmental issues when it comes to choosing products, with one in two preferring to buy green if possible. Eight out of 10 are checking for country of origin while quality symbols are important to consumer too with 75 per cent checking for these.

Environmental awareness has evolved for a number of reasons – at a local level government initiatives such as the Green Schools programme; Race Against Waste and on an international level and from a media perspective people like Al Gore and Sir David Attenborough are championing the cause as well as many others in the world of fashion like Stella McCartney.

“We have seen something that was the concern of a niche few becoming more mainstream. In line with that we are also seeing a rise in veganism and alternative proteins. Protein producers are going to have to look at their supply chain processes and behave in a more responsible way. Consumers are increasingly scrutinising what goes on behind the scenes of businesses and are able to scrutinise in a way that they haven’t in the past thanks to the technology that is now there to facilitate that,” she says.

While consumers are changing, not just their attitudes towards food at an astonishing rate, it's also clear that they are shopping differently, David Meagher, Head of Agribusiness at KPMG, says.

“Affluence, digitisation, health, nutrition and sustainability are all informing consumer choices. For example – smartphones will become many customers’ primary shopping tool. Retailers who don’t get this right may struggle. If you’re a supplier to a retail organisation that gets left behind in this space – the implications are significant,” he says.

Meanwhile, the evolution of co-ops into global food and nutrition businesses illustrates the fact that they need to evolve in order to survive. He says they are unrecognisable from even a decade ago.

"Your product mix needs to meet the changing needs and concerns of your customers. So for example, last year we saw Danone acquire WhiteWave for €12.3 billion to increase their exposure to plant-based alternatives and the organic food market."

Values that drive food industry consumption are changing according to Michael McMahon, Senior Manager Strategy and Operations at Deloitte.

A report carried out by them in recent years looked at the traditional value drivers such as price, taste, convenience and then emerging value drivers, including health and wellness, safety, social impact, experience and transparency. “From this it emerged that the new drivers are just as important to consumers as the more traditional ones,” he says.