MADISON, Wis. — The International Dairy-Deli-Bakery Association (IDDBA) finds value has a new meaning for recession-conditioned consumers: quality, convenience, and nutrition are factored into prices, particularly for the meals they’re more frequently preparing at home, according to What’s in Store 2011, the association’s 25th anniversary trends research report. Food retailers and manufacturers are tailoring products to meet the needs of a more sophisticated consumer.
Broad-based economic and social fluctuations are manifest in the dairy, deli, and bakery departments. Through 2014, the most impactful consumer trends are anticipated to be: demand for low prices, health and wellbeing, convenience, sustainability, and food safety and quality. The most important global industry trends, through 2014, are expected to be: rising energy and commodity costs, pricing pressures, innovation and differentiation, sustainability, and supply chain efficiencies. Health concerns are ever-present as food manufacturers and retailers make moves toward nutritious products, portion control, and energy expenditure in step with First Lady Michelle Obama’s Let’s Move! initiative against childhood obesity. At the same time, consumption growth is shifting to Generation X, Generation Y, and Hispanics as Baby Boomers age and U.S. fertility rates stall.
Cheese Facilitates Convenient Meal Preparation, Sparks Interest With Specialty Trends
Sales of sliced, shredded, and crumbled cheese are getting a boost from consumers hunting for convenience. The U.S. is the tenth-strongest cheese consumer in the world, at 32.8 pounds per capita annually. With many consumers planning snacks as part of their daily eating habits, cheese is a popular choice in that niche. In fact, cheese is the most often-consumed deli product in 2010, IDDBA research shows. Sales of specialty cheeses, such as Feta, Fresh Mozzarella, Sharp Cheddar, Queso Fresco, and Pecorino Romano, are growing rapidly. Joining wines, coffees, and chocolate as a gourmet product, small-batch, artisanal, locally produced and specialty cheese also carries a “better-for-you” halo that appeals to health-conscious consumers.
Delis Lighten the Meal-Prep Load With Easy Meals and Healthful Salads
Delis are becoming the bridge between dining out and dining in as time-strapped shoppers shy away from steeper restaurant prices, but still relish high-quality, easy-to-assemble meals. The deli prepared food category has grown to over 50% of in-store deli sales in the last five years. Deli meat and cheese dollar shares have gradually declined, but are strong category mainstays at 24% (meats) and 19% (cheeses) of the supermarket deli business. Shoppers are opting to pick up grab-and-go meals from deli displays, stocked with classic and authentic entrees and sides to ensure a full dinner without restaurant costs or the time it takes to cook. Delis are also encountering demand for healthful salads and vegetables, such as tabbouleh, bean dishes, and roasted vegetables at the service counter, pre-packed in self-service deli, or at olive bars. Exotic fare, such as Middle Eastern, Greek and Asian-inspired foods are also becoming more common fare as demographics continue to change in the United States.
Bakery is Trending Toward the Healthy, the Ethnic, and the Lavish
Trends show healthy breads, ethnic fare, and epicurean desserts are now mainstays of the bakery product lineup. Interest in breads with a healthier profile is accelerating: whole-grain bread consumption climbed 37% from 2009 to 2010, and consumption of value-added bread, such as iron-fortified, high-fiber, and crustless, rose 28%. Artisan breads made with locally sourced ingredients are also popular as they contribute to attributes of freshness and authenticity. Decadent desserts, such as elaborate cakes and cupcakes, have been made even more appealing in single servings and bite-sized portions —which also happen to be simple, easy, grab-and-go options that give customers control of price, calories, and leftovers. Mainstream bakeries are adding international fare, for example, with crusty Mexican bollilos, and Vietnamese bread baked specifically for popular banh mi sandwiches.
Younger Generations Lead Charge; U.S. Hispanic Population Balloons; More Male Primary Shoppers
In the post-recession recovery, Generations X and Y are the consumers predicted to fuel economic growth. Gen X, aged 29 – 45 years, is 62-million consumers strong, with members in their prime earning (and spending) years, and three-quarters of them have young families. Gen Y, aged 10-28 years, has 85 million people and most do not have their own households; therefore, they have higher discretionary income. These generations will lead the spending charge, in contrast with Baby Boomers. Though Boomers, aged 45-63 years, have 82 million people in their ranks, their wealth has decreased significantly, and their mindset is to save rather than spend. They are still a powerful consuming group, though, with the highest discretionary income. Hispanics are the fastest growing ethnic group in the U.S. At 50 million individuals, they’re the country’s largest minority. The top-ten largest U.S. cities have no ethnic or racial majority. America’s diverse melting pot brings with it a new global flavor curve—one that’s part comfort and authentic, and yet out-of-the-box, creative, and bold. In addition, shifting consumer lifestyles have put more men in the shopping aisles than ever before. Concurrently, over 30% of men today are the primary grocery shopper; this compares with 15% in 1985. Men’s average dollar basket size across all channels has increased significantly in the last year—especially in grocery—up 56% at $41.67, compared to $27.49 in 2004. In 2010, women became the majority in the workforce.
Broad Grocery Trends Echo Consumer Focus On Value, Convenience
Shoppers are sharpening their focus on value as far as shopping venue choice, so much that the market share of value-oriented formats, non-traditional grocery (supercenters, mass, wholesale clubs, dollar stores, military) will pass the traditional grocery (supermarkets, fresh format, limited assortment, and super warehouse) channel by 2017. Smaller, convenience-oriented stores will also grow with the influence of several global retailers. Quicker department access (attractive to aging and time-strapped consumers), fresh foods, and shopping services to help customers make healthy food choices will be their hallmarks. Social media sites, such as Twitter and Facebook, are delivering timely information from grocers to shoppers hungry for sales. Email and text coupons on cell phones are also becoming popular means of advertising in the digital age. On a global scale, China will surpass the United States as the largest grocery market leader due to population and middle class growth in the next four years. India, Japan, Russia, and Brazil are other countries that are prominent food grocery consumers.
What's in Store 2011, a 206-page trends report, details consumer and industry trends affecting the dairy case, cheese case, bakery, deli, and foodservice supermarket departments. Its 196 tables, developed in cooperation with leading industry firms and associations, include department sales, per capita consumption, consumer preferences, and random-weight, UPC, and private label sales data. The full report is available from IDDBA. The cost is $99 for IDDBA members and $399 for non-members, plus shipping and handling. Along with the book, readers have access to What’s in Store Online, featuring up to 53 quarterly-updated, downloadable sales tables with random-weight (PLU), UPC, and system 2-coded data. In addition, the Web site offers timely white papers, trends articles, and links to all of the businesses that are referenced in the What’s in Store book. For more information, or to order, call the IDDBA Education Department at 608-310-5000 or visit the organization's website.
SOURCE International Dairy-Deli-Bakery Association
