Reimagining Health and Wellness Presented by Laurie Demeritt, CEO, The Hartman Group Reimagining Health and Wellness
© 2013 The Hartman Group, Inc
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Hartman Group Overview About The Hartman Group
The Hartman Group is a consumer culture consultancy serving consumer packaged goods companies, retailers, and organizations in foods and beverages, foodservice, personal care, pharmaceutical, technology, shopper marketing and other businesses that comprise the consumer marketplace. Powered by primary qualitative, quantitative and trends research we know how consumers live, shop and use brands, products and services within the contexts of real life. We specialize in understanding how consumer attitudes, lifestyle and behaviors lead to purchase. We are an organization of more than 40 dedicated, curious and driven social scientists, marketers, numbers geeks and
designers committed to one goal: your success. Reimagining Health and Wellness
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Presentation Overview Evolving Food Culture and Changing Eating Occasions Health and Wellness Today
Expressions of Health and Wellness • Fresh, real, less processed • Organic
• Sustainable
Retail Landscape Parting Thoughts
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Evolving Food Culture and Changing Eating Occasions Reimagining Health and Wellness
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Who We Are as a Nation Has Changed Today •
70% of U. S. households have no children under the age of 18, down 23% since 1960
•
28% of U.S. households are single person households
•
The U.S. has the highest percentage of single-parent families among developed countries
•
46% of primary shoppers are men
Tomorrow
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By 2015, those aged 50+ (Baby Boomers and Silent Generation) will represent 45% of the US population
•
By 2015, Millennials will comprise over 1/3 of adults in the US
•
By 2050, the Hispanic population will double from 16% in 2010 to over 30%
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American Culture At Large Is Changing Too
TRADITIONAL CULTURE Status Quo: Utilitarian
CONSUMER CULTURE Distinction: Experiential
REIMAGINED CULTURE Creative Consumption: Imagination
clear societal roles
families are democracies
families as a social network
belief in rules, hierarchy
relativist & transient values
values in flux
class-based identity
lifestyle-based identity
malleable identity
focus on basic needs
focus on experience & desires
focus on creation
production drives economy
consumption drives economy
co-design, customization
quality as uniformity
quality as distinctions
quality as self-expression
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And, Therefore, Food Culture is Shifting
PAST Planned, Rational, Utilitarian
PRESENT Distinction, Specialization, Authenticity
S O M B E R , S E R I O U S , U N I F O R M , P R E D I C TA B L E ,
R I C H E X P E R I E N C E , Q U A L I T Y, D I V E R S I T Y,
F U N C T I O N A L , R E L I A B L E , E F F I C I E N T,
ADVENTURE, PLEASURABLE,
ECONOMICAL
BEAUTIFUL
PACKAGED/PROCESSED
FRESH/LESS PROCESSED
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The influence of food culture and changing demographics in the U.S. are impacting how, when and what consumers eat. Using OCCASIONS as the lens through which to view these changes is the best way to capture, leverage and capitalize on the opportunities. Occasions include: Who: what person(s) were involved When: circumstance or time period (routine snack, holiday dinner) Where: the place of consumption (at home, office, on the go) What: the key needs relevant to the occasion Why: the emotional stakes of the occasion Cultural perspective: instrumental, savoring or inspirational Reimagining Health and Wellness
© 2013 The Hartman Group, Inc
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Eating Occasions are Numerous and Differentiated
1.INSTRUMENTAL AFTERNOON SNACKS 9.9% 2. SAVORING DINNERS 9.4% 3. INSTRUMENTAL LUNCHES 9.1% 4. INSTRUMENTAL BREAKFASTS 9.1% 5. INSTRUMENTAL DINNERS 9.0% 6. SAVORING AFTER DINNER SNACKS 7.0% 7. INSTRUMENTAL MORNING SNACKS 6.5% 8. INSTRUMENTAL AFTER DINNER SNACKS 6.3% 9. SAVORING LUNCHES 6.1% 10. SAVORING BREAKFASTS 5.4% 11. SAVORING AFTERNOON SNACKS 5.0% 12. INSTRUMENTAL EARLY MORNING SNACKS 4.6% 13. INSTRUMENTAL LATE NIGHT MEALS 4.3% 14. 15. Source: Hartman Eating Occasions Compass, 2012 ; N= 14,697
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SAVORING LATE NIGHT MEALS 3.1% SAVORING MORNING SNACKS 2.6% SAVORING EARLY MORNING SNACKS 2.5% © 2013 The Hartman Group, Inc
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Occasions Tell Us That…..There are Now More Snacks Than Meals Snacking has risen from 49% of all eating occasions in 2010 to 53% of all eating occasions in 2012. Snacking:
• Is no longer infrequent • Is no longer just for children (55% of all Millennials eating occasions are snacking vs. 52% of Boomers eating occasions are snacking) • Is no longer just about indulgence (56% wanted something healthy for their last snack occasion)
• Is no longer just taking place in the afternoon (after dinner snacking has increased 54% in the past three years and pre-breakfast snacking has increased 15%) Reimagining Health and Wellness
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Occasions Tell Us That…..Many Consumers Now Eat Alone 46% of all adult eating occasions happen alone, with nobody present. This is a 7% increase from 2010.
40% of all adult meals (not just snacks) are eaten alone. 31% of adult alone-eating is about savoring, a higher quality food experience.
Eating alone: • Has become as normal as eating together • Allows for a new way of eating that is customized and personalized • Allows for new types of connectivity with others
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Occasions Tell Us That…..Immediate Consumption is Increasing Fewer than half of the trips to the grocery, club and mass discount stores are pantry stocking trips (and the meaning of “stock up” shopping has changed among consumers). Immediate Consumption (consuming the product within an hour of purchase) drives nearly 1 out of 10 adult eating occasions. The largest adult immediate consumption occasions are: • Instrumental afternoon snack • Savoring dinner • Instrumental lunch
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More than three-quarters of all eating occasions involve some prepared food
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We are Becoming a Nation of Eaters
From cook…
…to eater
EVERYONE EATS! We have become a culture of Intentional Eaters. Intentional Eaters are actively involved in food. Food is part of everyday life and is a definition of who we are. As cooks we: • Shopped for ingredients • Engaged in more planning • Did more pantry stocking • Shopped for familiar foods
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As eaters we: • Shop for meals and snacks • Are more spontaneous • Do more fill-in shopping • Shop for new and unique foods
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This Shift is Affecting the Traditional Meaning of Loyalty
Loyalty is changing for stores • Consumers prefer stores where they can always find unique products to eat • Non-food commodity items become less important • There isn’t the same reliance on pantry staples and ingredients • Over time, consumers are increasing the number of stores they shop for food and beverage Loyalty is changing for brands • Consumers who think of themselves as eaters will try a new brand just to have something different • Eaters are more brand agnostic than cooks Reimagining Health and Wellness
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Eaters Have Influenced the Rise of Private Label and Specialty Brands
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Health and Wellness Today Reimagining Health and Wellness
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Wellness in Now Seen as “Positive” Rather than “Perfunctory” C O N S U M E R S M O V I N G T O WA R D T H I S M O D E
POSITIVE, EXPERIENTIAL | CONTEMPORARY + GROWING
VITALITY
TAKING CARE
PREVENTATIVE
LONG-TERM
PROACTIVE
INDULGENCE
EXPERIENCE
FUN
ILLNESS
CRISIS
TREATMENT
QUICK FIX
REACTIVE
MEDICINAL
HAVE TO
BORING
P E R F U N C T O R Y | D O M I N A N T M O D E O F T H E PA S T C O N S U M E R S M O V I N G AWAY F R O M T H I S M O D E Reimagining Health and Wellness
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Wellness Has Become Quality of Life
Consumers have a vision for how they want to live and even what they don’t want life to be like Individuals are unique in what that vision may entail, how forwardlooking those aspirations are (today, tomorrow, 30 years?), and to what extent they intentionally make choices to achieve that quality of life “To me the point of doing these things now is to be able to live the kind of life I want later. I want the freedom to enjoy my family, do things important to me, be independent.” Reimagining Health and Wellness
Above reflects a consumer’s explanation of what living well means to her © 2013 The Hartman Group, Inc
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Emotional Wellness is Becoming Paramount
“Not being ill” has decreased to number 5 from number 2 in 2007. Consumers are focusing slightly less on illness and more on other meanings of wellness
Q10/Q15. To me, health and wellness means … Base n=2928-2007; 2744-2010.
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There is important overlap between health and wellness and indulgence in several categories
Product Freshness cues Unique flavor profiles Premium cues
HEALTH & WELLNESS
Integrity of ingredients Narrative
INDULGENCE
Usage Occasions Moderation Balance Pleasure
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Wellness Segmentation
13%
62%
“Wellness is a comprehensive lifestyle. It’s physical, emotional, spiritual. And being preventive and proactive about things.”
25%
─ Shelley, Core Consumer
“For my lifestyle, I want to spend less time in the car.” ─ Kevin, Mid-level Consumer
“I have to laugh every single day.” ─ Bethany, Periphery Consumer
Core is the smallest segment and most intensely involved - early adopters, trendsetters, evangelists
Mid-level is the majority of consumers and not as intensely involved with or committed as Core consumers though they exhibit some attitudinal and behavioral characteristics of the Core
Periphery is where consumers least involved in Wellness reside.
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The Core Wellness Consumer Leads the Trends
Periphery Price Convenience Brand
Purchase Criteria
Mid-level
Core
Experience, Expert Opinion Fun/Enjoyment Quality
Opportunity (The Periphery borrow quality cues from the Mid-level)
Strategic Implication
Add value beyond Price, Convenience
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Authenticity Sustainability Knowledge Quality
Trends
(The Mid-level is influenced by the Core)
Combine pragmatic sensibilities with Core aspirations and quality distinctions
Track their dynamic values and behavior due to their influence on future market trends
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The Meaning of Wellness Becomes More Sophisticated as Consumers Evolve
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There are Significant Differences in How the Segments Make Food Choices
Q55. When shopping at a store for food, how important are the following features to you when deciding which product to purchase? (Top-2 box: Extremely/Fairly important). Bases: Overall (n=778), Core (n=104), Mid-level (n=560), Periphery (n=114). 2011. Reimagining Health and Wellness
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Consumers are continuing to invest more in fresh wellness product categories than any other categories
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Day-to-Day Concerns are Triggering Attitudinal Change Among Younger Cohorts
“Right now I’m getting my MBA at night and working full-time and trying to fit in time for my friends. Just juggling everything is my big challenge right now, not really physical ailments.” ~Dan, age 30, Mid-level Consumer
Q18: What caused you to change your views on health and wellness? Base: consumers that changed their views on what health & wellness means n=1404. 2010
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The Internet Has Become the Principal Source of Wellness Information internet sites dedicated to health information (e.g., WebMD) product label
28%
doctor books/magazines friend/other relative
immediate family member tv/radio newspapers advertisements
internet sites not dedicated to health information (e.g., Wikipedia) pharmacist store display
none of these
57%
36% 37%
31% 30%
36%
30% 28% 27% 25% 32% 25%
20% 22% 22% 19% 16% 19% 18% 14% 13% 16% 18% 22% 16% 14% 15% 15% 13% 10% 13% 12% 10% 21% 24%
45%
34%
42%
Core consumers over-index on all the top sources of information. The Periphery are more likely than others to listen to friends and relatives if they utilize any sources at all.
Core Mid-level Periphery
Q36. In the past 3 months, which of the following information sources have you used to learn more about health and wellness? Bases: Overall (n=1,713), Core (n=217), Mid-level (n=1,198), Periphery (n=298). Reimagining Health and Wellness
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Wellness Category Adoption is Cumulative as Knowledge Grows Categories are not simply replaced, but added to those presently and habitually used
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Specific Food Attributes Ladder to Health Benefits Ingredients added for special health benefit (e.g., added calcium or fiber)
64%
Higher in nutrients (e.g., protein, fiber, whole grains, Omega-3, etc.)*
61%
Ingredients I recognize
60%
No trans fats
60%
Lower in calories (due to fat, carbohydrates or sugars)
57%
Lower in salt
57%
Made with simple, real ingredients
56%
Made with natural ingredients
54%
Absence of artificial ingredients
50%
Absence of artificial sweeteners (e.g., aspartame, Splenda, saccharin)
49%
No high fructose corn syrup
48%
Absence of preservatives
46%
Absence of artificial flavors
45%
Absence of artificial colors
41%
Shorter list of ingredients
41%
Absence of ingredients I'm allergic to (e.g., gluten, nuts, dairy) Made with local ingredients
36% 33%
Made with seasonal ingredients
32%
Made with organic ingredients
32%
* Complete survey item read “Higher in nutrients (e.g., protein, fiber, whole grains, Omega-3, probiotics, vitamins, minerals)” Q56. How important are the following attributes to making a FOOD PRODUCT good for your HEALTH AND WELLNESS? [Top-2 box (Extremely/Fairly important) in 5-point scale.] Bases: Respondents assigned to food or company category: Consumers in general (n=1,160). 2011.
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The Nutrition Facts Panel is the Key Indicator of Health Benefits
Q50. Earlier, you indicated that you get health and wellness information from product labels. On what occasions do you use the following kinds of information to judge the healthfulness of products when shopping for food and beverages? Bases: Respondents who have used product labels to learn more about health and wellness in the past 3 months. Overall (n=570), Core (n=99), Midlevel (n=387), Periphery (n=84). 2011.
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Consumers are INCREASING Various Ingredients in Their Diets
Slow and steady growth: Fiber and calcium Continuing to rise: Whole grains and protein Rising stars: Vitamin D and Omega 3
Q32. Please indicate whether you DELIBERATELY avoid/reduce or add/increase any of the following ingredients or nutrients in your daily diet. – add/increase. Base n=2744.
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Top Ingredients that Consumers AVOID
Cholesterol
61%
Saturated fat
61%
Trans fat
58%
Sodium/Salt
56%
Preservatives
50%
High fructose corn syrup (HFCS)
50%
MSG
49%
Artificial flavors
47%
Artificial colors/dyes
44%
Aspartame (e.g., Equal)
44%
Saccharin (e.g., Sweet N' Low)
44%
Refined sugar
41%
Caffeine Sucralose (e.g., Splenda)
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39% 32%
Q32. Please indicate whether you DELIBERATELY avoid/reduce or add/increase any of the following ingredients or nutrients in your daily diet. Base n=2744.
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Food is Used to Prevent Many Health Conditions but its Reliance is not as Strong for Treatment Food Used to Treat
Food Used to Prevent Diabetes
58%
Diabetes
Overweight
57%
Overweight
High cholesterol
56%
Digestive disorders
48%
Cancer
46%
Heart or cardiovascular…
42%
Food allergy/sensitivity
42%
Eating disorders
42%
High blood pressure
41%
Memory/mind health
28%
Osteoporosis
27%
Hyperactivity
Auto Immune Disorder
24% 22%
Menopause difficulties
21%
Sensitivity to irritants
20%
ADHD
32% 59%
High cholesterol
30%
Digestive disorders Cancer
27%
10%
Heart or cardiovascular…
21%
Food allergy/sensitivity
45%
Eating disorders High blood pressure
Memory/mind health Osteoporosis Hyperactivity
48% 15% 18% 10% 17%
Auto Immune Disorder
12%
Menopause difficulties
11%
Sensitivity to irritants
11%
ADHD
Food is still relied upon for certain obvious issues
9%
18% Q21. Are you treating or preventing these health conditions with food? Base: Consumers that are preventing or treating health condition (n varies from 235 for ADHD to 1667 for High cholesterol).
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Expressions of Health and Wellness Reimagining Health and Wellness
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The Meaning of Food Quality is Evolving
The trend toward fresh, real, less processed foods is a historical process
trends
Cultural
Consumers were in pursuit of … Reliability
Health & Wellness
Efficiency
Experience
Uniformity
Authenticity
Predictability
Distinction
1950s / 1960s expectations
FACTORY-MADE represented Quality
Quality
Consumers are now in pursuit of …
Big brands delivered convenience, consistency, affordability and safety through mass produced food.
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Now REAL and FRESH represents Quality There is a cultural shift toward products that are not perceived as factory made.
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The Perimeter of the Store is Resonating with Consumer Health Aspirations
Consumers link the processed foods found in the center aisles with: • Weight problems • Various health conditions (e.g., diabetes)
• Behavioral problems (e.g., ADD, energy crashes) • Food allergies
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Consumers look to a wide range of signs as they evaluate freshness and quality Common industry understanding of fresh:
Consumer understanding of fresh:
Fresh foods are those in their most natural state without any processing or preservatives, and minimal, if any, packaging.
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Product Cues are Becoming More Important than Specific Ingredient “Call-outs”
What’s in it?
Negatives, positives, uniqueness
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How’s it made?
Processing, production stories
How’s it packaged?
Ingredient list, packaging materials and imagery, store placement
Who made it?
Origin and producer narratives
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Cues: What’s In It Absence of negatives No artificials, preservatives or “chemicals” • No trans fats, hydrogenated oils • No HFCS •
The following are important when I shop for healthy foods…..
Presence of positives/inherently health Organic, seasonal, local • Complex carbs, protein, fiber, whole grains • Low sugar, “good” fats • No GMOs •
Unique varietals Heirloom products • Heritage meats •
Source: Healthy Eating Trends.. Q19: How important would you say each of the following descriptions is to your household when shopping for healthy foods? Think about what really matters to you when reading labels and product descriptions. – Top-2 box scores on a 8-point scale ranging from 0=“Don't know/Never heard of this” to 7=“Extremely important to healthy food shopping.” Base n=1501. 2009.
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Cues: How’s It Made Known processing method • “Something I could make at home” • Descriptive words such as simmered, steamed, etc.
Minimal processing • Product retains more of its “real” ingredients and flavors
Unique production techniques tell a story of how a product “came to be” • More care went into producing the product • There was a “human touch” as part of production
• “Hand picked”, “specially selected”, “harvested when ripest”
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Cues: How’s It Packaged/Where’s It Placed
Ingredient list Short • Recognizable •
Packaging • • •
See through packaging Images of raw ingredients Close-in expiration date
In-store • Perimeter store placement • Refrigerated section
Source: Wellness Lifestyle Insights: Q29: Please read each statement and indicate how well it describes your own behavior regarding shopping for food and beverages. – Describes me well and describes me somewhat (n= 2744). 2010.
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Cues: Who Made It Want to understand who is behind a product •
Believable/trustworthy
•
Actual people involved in production
•
Values relevant to their lifestyle
•
Inspiration!
Geographic origin narratives also provide points of distinction and quality for products •
Certain categories of products “should” come from only specific growing regions
•
“Local” (subjective in nature)
•
Terroir/provenance
Narratives must include three key elements: • Transparency – the story must be true/verifiable • Raison d’etre – there must be a compelling reason for why the product came to market • Emotional hook – the story must resonate with consumers at an emotional level, not just a functional level Reimagining Health and Wellness
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Today, about three quarters of U.S. consumers purchase organic food/beverage products
Q7. How often have you used organic foods or beverages in the past three months? If you use some organic products more often than others, please indicate the greatest frequency. For example, if you used organic milk daily and organic fruit occasionally, choose daily. Base: All respondents (n=1,569).
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Organic is primarily understood as pertaining to what happens to food at origin (e.g. the farm, the plant, the animal) 64% 64% 62% 65% 65%
Absence of pesticides
60% 62% 54%
Absence of herbicides
62%
57% 59% 64% 56%
Absence of growth hormones
61% 59%
No artificial flavors-colors-preservatives
All Organic Users
56%
Core
59% 58% 55%
Inner Mid-level
51%
Outer Mid-level Periphery
55%
59% 57% 55%
Absence of antibiotics 48%
54% 62% 55% 52% 50%
Absence of genetically modified foods
48% 52% 49% 49%
Absence of food irradiation 44%
Q3. From the following list, what properties do you think are implied or suggested by the term "organic"? Bases: Respondents who used organics in past 3 months (n=1,120), Core (n=250), Inner Mid-level (n=261), Outer Mid-level (n=428), Periphery (n=181).
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Natural is primarily understood as what happens to the food after it is grown (e.g., processing steps, production additives)
No artificial flavors-colors-preservatives
53% 53% 49%
Absence of growth hormones
45%
47%
Real
42%
48%
46% 48% 42% 43%
43% 44% 43% 46%
Absence of pesticides
44% 43% 42% 45%
Fresh
Absence of antibiotics
40% 41%
53%
51%
All Organic Users Core
50%
Inner Mid-level Outer Mid-level
50%
Periphery
49% 50%
45% 46% 46% 42% 40% 45%
Absence of herbicides
53%
45%
46%
Absence of genetically modified foods
57%
50%
41%
Pure
56% 56%
41%
50%
44% 42%
Q2. From the following list, what properties do you think are implied or suggested by the term "natural"? Bases: Respondents who used organics in past 3 months (n=1,120), Core (n=250), Inner Mid-level (n=261), Outer Mid-level (n=428), Periphery (n=181).
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Despite the growing significance of natural foods, consumers remain unconvinced by natural as a marketing term
•
Consumers view “natural” as a subjective rather than objective term: There are no agreed upon criteria for what it means.
•
Consumers believe that anyone can put the word “natural” on their product, regardless of what it contains.
•
Even as the Organic label becomes diluted, it retains more meaning on packaging because consumers know there are regulations that back its use.
!
Consumers are highly suspect of the natural label on packages.
Natural is a marketing ploy everybody knows labels don’t mean what they say. Sometimes I feel like these companies think we’re all stupid.” – Mark, Seattle
When formulating truly natural products, consumers will be most receptive to messaging that does not rely exclusively on the word “Natural.”
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Organic and natural produce, meat and dairy absorb most household organic dollars 28%
Fruits and Vegetables
53%
33%
13% 12% 26%
Meats, Poultry, Fish and Eggs 8%
52%
28%
12%
24%
Dairy Products
49%
24%
11% 10%
21%
Cereals and Grain Products and Bakery Products 6%
42%
25%
8%
All Organic Users* 20%
All Other Food
9% 7%
5%
10%
42%
21%
Core
Inner Mid-level 19%
Non-Alcoholic Beverages (other than Dairy or 100% Fruit/Vegetables Juices)
Core and Inner Mid-level consumers spend far more on Organic and Natural products than do the Outer Mid-level or Periphery segments
21%
37%
Outer Mid-level Periphery
* All organic users who purchased organics in past 3 months. Q16. What portion of the last 30-days spending in each category was spent on organic, natural, or hormone-free foods and beverages? Bases: All respondents who purchased organics in past 3 months (n=1,036), Core (n=250), Inner Mid-level (n=261), Outer Mid-level (n=382), Periphery (n=143). Source: Organic and Natural 2012 survey (fielded July 2012).
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Organic users are most willing to try fresh fruits and vegetables as they enter into the World of Organics Example: 24% of organic users tried organic fresh vegetables first and 55% included them as one of the 1st five organic categories they tried
Fresh vegetables
50%
Fresh fruit
% Organic Users
40%
Milk
30%
Eggs Yogurt
20%
Juice
Red meat
Breads White meat Cheese
10%
0% 1st categ. tried
Among first 2 categs. tried
Among first 3 categs. tried
Among first 4 categs. tried
Among first 5 categs. tried
Q19. Thinking back to when you first tried organic products, what was the [first/second/third/fourth/fifth] category of organic products that you tried? Base: All organic users who purchased organics in past 3 months (n=1,036). Source: Organic and Natural 2012 survey (fielded July 2012)..
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Retail Landscape Reimagining Health and Wellness
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Consumers are Constantly in Shopping Mode
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Culture is Changing How We Shop for Food
Planning is hard when we eat in the moment according to our moods, whims and ‘schedules’. Even when plans are made [lunch is brought from home] we’re likely to upgrade for a better offer because food is everywhere, enticing us. We are shopping up & down the food chain [from Aldi to Trader Joe’s, Walmart to Whole Foods Market].
More than 50% of “trips” to shop for food/beverage involve going to 2+ stores.
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Successful Retailers are Evolving from Mere Editors to Curators
The fastest growing banners can be seen as curators. Either because of limited selection (Dollar General, Aldi) or high quality product selection (The Fresh Market, Whole Foods Market). Reimagining Health and Wellness
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All Channels are Relatively Low in Consumer Satisfaction
grocery
dollar
club
mass
drug
% Shopped last month
92%
61%
46%
74%
78%
% Satisfied with last trip
56%
44%
45%
54%
47%
GROCERY PERFORMS BEST. Grocery is one of only two channels in which the majority of consumers were satisfied with their last trip. Despite this, there is certainly room for improvement. DOLLAR DISSATISFACTION. Shoppers often disappointed in the quality for the price and often cannot find what they need. CLUB DISSATISFACTION. Shoppers concerns about waste/spoilage and how to store large quantities continue to grow. DRUG DISSATISFACTION. Shoppers tell us that they are tied to their drug store because of their prescriptions/insurance, but are not particularly happy with the overall shopping experience. N=1,900; Club n=665; Dollar n=901; Drug n=371; Grocery n=968; Mass n=909 Reimagining Health and Wellness
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Club and grocery are home to the stock-up trip; drug and dollar trips gravitate toward immediate consumption trips
Trip Mission
grocery
dollar
club
Stock-up
47%
23%
50%
42%
29%
Fill-in
25%
23%
23%
21%
21%
Event-based
12%
8%
8%
14%
6%
Immediate Consumption
11%
21%
8%
7%
24%
mass
drug
CONSUMERS CLAIM that they still go on their weekly or monthly stock-up trips to grocery, club stores and, increasingly, mass stores but during the week the stock-up trip needs to be supplemented with fill-in trips to a variety of different channels, depending on needs, occasions, forgetfulness and, in the case of immediate consumption, hunger and thirst. According to IRI, all outlet pantry stock-up trips have declined by 1.1% of channel $ sales and quick trips have increased by 1.2% (2008 vs. 2011). For your most recent trip to a (insert selected channel), what made you initially decide to go on this trip? N=1,900; Club n=665; Dollar n=901; Drug n=371; Grocery n=968; Mass n=909 Reimagining Health and Wellness
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The New Value Paradigm Traditional
Current
(functional)
(functional + emotional)
Price
Price
Quantity
Quantity
Convenience
Convenience Quality Price Experience Experience Lack of Waste Quantity
Consumers are now transitioning to a more purposeful and emotional perspective on value, and are asking themselves the following types of questions: •
Is this item really necessary?
•
•
Will my family actually use / consume / eat / drink this item?
Will the item in question last a long time? Will I get a lot of use out of this item?
•
Will I enjoy using/consuming this item?
•
Will the item meet my taste/efficacy/quality standards?
•
Will I be able to avoid throwing t he item in question away unused?
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The Impact of the Recession
What has changed: • More pronounced evidence of channel shifting
• More orientation to promotional strategies • Dining out less often so looking for “restaurant quality” meals at grocery stores
What hasn’t changed: • Consumers are not radically changing their food and beverage preferences » They are making trade-offs, but not leaving entire categories
• Consumers are not abandoning their interest in high quality food experiences » For example, wellness product attributes are currently a sign of product quality and are interpreted by many consumers as getting good “value” for their money
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Consumers “Channel Surf” for Value
THERE IS NO ONE VALUE CHANNEL, each channel has a unique value proposition that taps different dimensions of the New Value Paradigm. Consumers assess value at channels on a category-by-category basis. • Fresh departments create quality halo; premium offerings allow for distinction. • Service, safety, cleanliness, proximity, atmosphere and opportunities for discovery.
QUALITY EXPERIENCE
grocery
PRICE RELEVANCE
dollar
• Ability to procure basics at bargain-basement prices; deeply discounted national brands. • Sizing, format options allow buying-as-needed and caters to individual or family use.
QUANTITY QUALITY
club
• Routine commodities in bulk sizing allow purchase of national brands at notable price per unit. • Fresh departments provide quality comparable to grocery at a compelling price.
mass
• Everyday low price (EDLP) across categories; large selection of private brand. • Competitively priced national brands set bar for quality.
PRICE QUALITY RELEVANCE QUALITY
drug
Reimagining Health and Wellness
• Sizing and format options in many categories, including grab-n-go food caters to individual use and immediate consumption. • National brands reflect familiar quality among personal care and OTC.
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Grocery is the Key Channel for Wellness Product Purchase
The Core is more likely to seek H+W in specialty and natural food channels
Q37. Which of the following kinds of stores do you regularly shop (i.e., at least 4 times a month) for health and wellness products? Bases: Overall (n=1,713), Core (n=217), Mid-level (n=1,198), Periphery (n=298). 2011.
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Produce is a Key Driver for Grocery Store Choice Large selection of healthy fresh/perishable foods such as fruits, vegetables, lean meats
56%
Large selection of personal care products
40%
Large selection of over-the-counter (i.e., non-prescription) medications
39%
Signs or labels at shelf indicating products’ nutritional value
36%
Large selection of vitamins and minerals
36%
Large selection of healthy prepared foods
34%
Large selection of natural and organic products, fresh and packaged
33%
Special section of the store for natural and healthy foods, beverages and products
32%
Pharmacist who supports complementary healthcare practices (e.g., naturopathy)
31%
Large selection of specialty supplements (herbals, probiotics, etc.)
30%
Health and wellness information oriented to prevention rather than treatment
28%
Health and wellness information to treat/manage specific health conditions
28%
Seamless connection between an in-store pharmacy and the rest of the store
27%
Availability of in-store health services such as flu shots, cholesterol screenings, etc.
25%
Health and wellness information tools on its website
24%
Healthy cooking "how-to" information (recipes, techniques, etc.)
23%
Health and wellness education programs about specific health topics*
23%
Health and wellness education programs about general health management Large selection of magazines and cookbooks relevant to my lifestyle
Healthy cooking "how-to" classes/demonstrations
22% 20% 19%
* Complete survey item read “Health and wellness education programs about specific health topics (e.g., weight management, diabetes, heart health)” Q75. How important are the following in-store features to making the [food] store a health and wellness destination for you? (Top-2 box: Extremely/Fairly important). Base: Respondents assigned to food store category: Consumers in general (n=1,298). 2011. Reimagining Health and Wellness
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Parting Thoughts •
Demographic shifts are changing the landscape of America – consider targeting some of the “new” households (single person, no kids, etc.)
•
Food culture is evolving at break-neck speed – look at the “margins” to identify the next trends
•
New eating occasions are emerging – explore the snacking occasions where health is a top concern
•
Wellness is about far more than health – target emotional concerns as well as physical
•
Fresh, real, less processed is a long-term trend in how consumers are describing their food goals – leverage the appropriate category cues to position your product in this space
•
As consumers shop more and more channels for food, retailers need to determine what their value proposition is (it’s not just about lowest price) and how they can become curators in the categories that matter to consumers
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