Consumers aren’t eating as well as they’d like, and this is an opportunity, according to a new report by Nielsen. In fact, while sharp sales growth has occurred in fresh foods (up $4.6 billion), organics (up $925 million) and foods that support plant-based diets (up $982 million), the reality is that there is still opportunity for growth in consumer packaged goods (CPG), the report suggested.
Research by the firm found that the gap between the intention to eat better and action to do so isn’t from lack of trying.
“Nearly all (99% of) Americans have purchased a low-fat food or beverage item this year, but households only do so about twice a month. Similarly, U.S. homes are only buying organic, sugar-free and high-protein foods about once a month in each case,” the report said.
Statistically speaking, Nielsen said a dark cloud looms over eating patterns in America. In 2018, one in five Americans was considered obese, and one in nine homes lacked access to enough food at some point in the year. Perpetuating these problems, nearly one in four (23%) people admit to never or rarely exercising.
Despite the ongoing struggle, two-thirds of Americans said their eating habits have changed over the last five years. This shift in behavior could be monetized, Nielsen said, but added that it is only valuable if manufacturers and retailers can fulfill consumer intentions with available products.
“Consumer intentions like these can help manufacturers and retailers spot gaps in ways products are not meeting evolving consumer needs, so they can close them,” Nielsen noted. “Our research confirms that consumers, particularly younger ones, have a new set of expectations for food products.”
Still, there’s no single definition for what constitutes healthy food today, and Millennials, in particular, have indicated that health is not the sole factor driving changes in eating habits, the report relayed.
“Millennials are most likely to define healthy eating in practical ways, whereas surveyed Boomers, Greatest Generation consumers and even Gen Xers indicate their eating habits are more heavily guided by health maintenance or specific health conditions,” Nielsen reported.
For example, the report said Millennials think about healthy eating more holistically than other generations, placing rising importance on food for the mind.
“More so than any other cohort, Millennials feel healthy eating isn’t just about nutrition and diet; they believe it extends to mental wellness, stress management and saving both money and time. Millennials are two to three times more likely than the oldest generations to change their eating habits in order to manage mental health, finances and time,” the report said.
Translating these ideals into products on the shelf is a tall order to fill, though, according to Nielsen. “To put it simply, consumers, especially Millennials, want to buy foods that work ‘harder’ for them and their lifestyles.”
As such, Nielsen said the values and desires that drive consumers' lives make for a seemingly impossible equation companies must solve: How can people save time and money while maintaining good overall health, mental strength and stress management?
To help solve the equation, Nielsen broke down the behaviors surrounding food affordability, time savings and products that promote healthy lives and minds.
Americans are drinking -- not just eating -- their snacks, and beverages can help bridge the gap to time savings with healthier eating. In fact, beverages are among the top-trending consumable categories today, and while things like value-added water and energy beverages may not be the most filling when it comes to a snack occasion, for many consumers, drinks aren’t typically intended to serve as a meal replacement. More so than many other reasons, three in 10 Americans say they are more likely to drink beverages “as a way to revive or sustain energy levels.”
Mental health and stress management are another part of the "impossible equation," according to the report, “and it’s not just beverages that are innovating to bridge the gap to healthier eating in America. The future of food is grounded in uniting the health of the body and the mind.”
Improvement in consumer awareness and care for mental wellness means that companies need to prioritize mental health just as much as they do physical health in encouraging dietary changes, the firm recommended.
However, even foods that save time or improve mental health must be reasonably priced, Nielsen said.
“This is an ultimate barrier to closing the gap between what Americans want to consume and what they actually end up buying. Consumers won’t try what they don’t believe they can afford,” the report said.
Packaged frozen and shelf-stable produce, for example, is well positioned to capitalize here, Nielsen noted, adding, “Companies playing in this space need to exploit the wallet-friendly nature of these options and inspire meal occasions using back-of-the-freezer or pantry produce.”
Manufacturers and retailers also have an opportunity to promote the price efficiency of certain fresh meats as healthy protein options. Nielsen relayed that trendy and convenient protein sources like jerky (25 cents/g), nutrition bars (20 cents/g) and nuts (13 cents/g) may suit on-the-go consumers, but they are sold at 6-12 times the price per gram of chicken, pork and turkey (2 cents/g, respectively).
“For the 55% of Americans who prioritize high protein content when deciding what to buy, this message of protein price accessibility could draw renewed attention to traditional meat-based goods," the report said. "Distracted by power messaging about nutrition bars or meat snacks, many consumers could be swayed by re-education on the protein content actually in a serving of fresh meat, for example.”
According to the report, companies must tackle concerns directly and consistently in order to lower barriers to entry with healthy food consumption. Americans have expressed that price matters most when it comes to future food and beverage consumption.
“For both initial trial and long-term adoption, careful price management can make all the difference between landing in a basket and staying on the shelf,” Nielsen reported.
Research has found that one-third of Americans (33%) will prioritize price when it comes to what they consume over the next five years. Additionally, 75% of Americans believe getting the best price on a product is the most important.
“This isn’t ‘new’ news, but it’s interesting to see where consumers are and are not willing to splurge as well as gain insight into the product details that ground these preferences,” the report added.
Nielsen said the message is clear for food companies: Price is the dominant driver of food purchases unless there are other factors to consider.
“With the exception of alcoholic beverages, a sizable share of Americans are likely to base their food purchase decisions predominantly on price. The gap between intention and action for healthier eating boils down how brands can force the consumer habit to consider health-oriented attributes, too,” Nielsen said.
The firm also found that monitoring sugar intake will be top of mind for 23% of Americans over the next five years, noting, “When we look at the top diet preferences across the nation, lowering sugar and adhering to diabetic diets are among the top 10. Americans want sugar-controlled diets, and companies (even in confectionery) need to help, not hurt, these habits.”
As such, brands that can get ahead of consumers’ dietary improvement goals can foster behavior that moderates intake to healthy portions that both consumers and companies can benefit from, Nielsen said.
“For confectionary, soft drinks, desserts and other related categories, now is the time to encourage health-minded consumption of indulgent products. Consider expanding or optimizing your offerings with portion-controlled pack sizes for sweets. We know consumers like to indulge in sugary products, so improving the way Americans do so will help the both consumer and the company,” the report said.
Overall, Nielsen said the foods that will boost and not break consumer goals will win by bridging the gap to healthier eating in America.