Jennifer Dennis, Ph.D.

Purdue University

CONSUMER FOOD TRENDS FOR THE NEXT TEN YEARS AND WHAT THEY MEAN FOR YOU

OPINIONS, ATTITUDES, AND INTERESTS

•  We turn to one food fixation after another

–  1985 sugar –  1986 caffeine –  1987 salt –  1990 cholesterol –  1994 fat –  2003 carbohydrates

Source: NPD Group

Individual Influences: - Perception - Motivation - Learning - Attitudes - Personality

Personal Influences: • Age and gender • Income • Life stage • Lifestyle

Situational Influences:  Time of purchase  Time available  Mood  Shopping environment  Persons accompanying

Social Influences: < Culture / sub-culture < Social Class < Reference groups < Influential

Choice

Consumer Behavior Decision Model

FOOD CONSUMPTION AND SPENDING TO 2020

•  Consumers will demand:

•  New food products

•  New packaging

•  More convenience

•  New delivery systems

•  Safer nutritious food

Source: USDA ERS, Food Review: Vol 25(1)

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INCOME, AGE, RACE, AND EDUCATION ARE MAJOR FACTORS

•  Higher Incomes

•  Aging Populations •  Changes in age distribution will have a bigger effect on per capita food

expenditures

•  Older people tend to eat away from home less frequently than younger people

•  Fruits, vegetables, fish and pork will increase

•  Higher Educational Achievement •  Shifts in consumption expected to occur with income growth

•  Influx of Ethnic Populations •  U.S. Hispanic population is expected to grow

7

Population in millions

Hispanic Population in the United States: 1970 to 2050

*Projected Population as of July 1

Projections Census

Source: U.S. Census Bureau, 1970, 1980, 1990, and 2000 Decennial Censuses; Population Projections, July 1, 2010 to July 1, 2050

8

Percent Hispanic of the Total Population in the United States: 1970 to 2050

*Projected Population as of July 1

Projections Census

Source: U.S. Census Bureau, 1970, 1980, 1990, and 2000 Decennial Censuses; Population Projections, July 1, 2010 to July 1, 2050

ASIAN POPULATION •  $254 Billion in buying power

•  Younger than the average market

•  30.1 years

•  Average household size is larger than other groups

•  3.8 Asian Households vs. 3.2 for Americans

•  Cultural preference for multi-generational households and fueled by immigration

•  Social Status

•  Image is important

•  Highest household income of any group

•  $10,000 higher than non-Hispanic Whites

•  $22.000 higher than Hispanics

WHAT MAKES YOU FEEL COMFORTABLE

•  Place identity

•  Congruency between a consumer’s self-identity and consumption setting

•  Ethnic consumers evaluate their place identity by assessing verbal and non-verbal cues in a consumption setting

•  It is not just about what you sell….what does it mean in relation to their self-identities

Source: Journal of Business Research, 2007

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Source: USDA ERS Fruit and Vegetable Consumption, 2004

Source: USDA ERS Fruit and Vegetable Consumption, 2004

FOOD PRICES

•  Continue to see rising food costs based on higher costs of fuel, feed, packaging, food safety

•  Higher demand for exports

•  Consumer food costs can decrease by:

•  Using less meat and seafood

•  More non-meat ingredients

•  Whole-wheat pasta, brown rice, vegetables, etc.

Current Economic Indicators

January 04, 2012 (Close of Day)

Indicator Value

US GDP Growth, % 1.81

US Inflation, % 3.41

US Unemployment % 8.60

2011 AND 2012 CPI ESTIMATES

•  CPI for all food is projected to increase 3.25 to 3.75 percent.

•  Food-at-home (grocery store) prices are forecast to rise 4.25 to 4.75 percent

•  Food-away-from-home (restaurant) prices are forecast to increase 2 to 2.5 percent.

•  Cost pressures on wholesale and retail food prices due to higher food commodity and energy prices, along with strengthening global food demand, have pushed inflation projections upward for 2011.

•  Price levels in 2012 will hinge significantly on several macroeconomic factors such as weather conditions, fuel prices, and the value of the U.S. dollar (an indicator of global demand).

GENERATIONAL SEGMENTS

BABY BOOMERS

•  Control 52% of spending on food by 2015

•  Largest food purchasers and influencers

•  Food and beverages with health benefits

•  Wider aisles and lower shelves

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All All Baby Boomers Younger Boomers (47-55)

Older Boomers (56-65) All Baby Boomers

Base: internet users aged 18+ 2,000 622 340 282

% % % % Index*

Have health insurance or a health savings account 73 76 77 74 104

Cook healthy meals from scratch 67 71 70 72 106

Take vitamin supplements 64 68 66 72 108

Look for healthier menu options when dining out 61 64 65 63 105

Eat at least three servings of fruit/vegetables a day 53 56 56 55 105

Exercise regularly (at least three times a week) 53 51 55 46 96

Purchase foods fortified with vitamins 52 52 55 48 99

Seek to include foods in my diet that I believe will enhance my wellbeing, such as super fruits

51 50 50 50 99

Avoid eating processed food 41 42 44 40 103

Eat/drink organic food/beverages 38 31 34 28 82

Limit consumption of or completely avoid meat 28 29 26 32 101

Smoke 23 21 22 20 92

Meditate 20 18 17 20 91

Practice yoga, Pilates, martial arts (tai chi, aikido, etc.) 15 10 11 9 67

Visit a complementary or alternative medicine practitioner (such as an acupuncturist or other alternative health care provider)

11 9 11 7 85

Figure 49: Baby Boomers’ diet and lifestyle behaviors, by younger/older Boomers, August 2011 “Thinking about your diet/lifestyle in general, which of the following do you personally do?” * an index of 100 = average adult aged 18+. Indices of 110 and above and 90 and below are considered significant. An index of 110 indicates Baby Boomer respondents are 10% more likely than the average adult to have chosen the response. An index of 90 indicates that Baby Boomer respondents are 10% less likely than the average adult to have chosen the response.

FARM TO FORK

•  Male Shoppers

•  41% of men are cooking at home

•  Extreme Home Cooking

•  Eating at home to save money

•  Making the most out of the least

•  Buying Local

•  Blogs and social media help tell the story

SOCIAL NETWORKING TIDBITS

•  Google.com/alerts – what are people saying about you

•  Nearbytweets.com – tweets by subject •  Nearby Tweets makes it simple to find twitterers nearby (or anywhere for that matter)

by your location and the last 50 tweets near you

•  Listorious.com – search for users and lists

•  Hootsuite – web based platform where you can manage all social media accounts

•  Can manage most accounts

•  facebook, twitter, linkedin

•  Can create a search for people using terms or keywords

•  Can pre-schedule content (time management)

•  Where is your smart phone technology?

QUESTIONS