For roughly half of consumers today (51%), health and wellness, safety, social impact, experience, and transparency drive their purchasing decisions, said the report, titled Capitalizing on the shifting consumer food value equation.
The new normal
In the report, this shift in attitude and drivers is labelled as “Evolving Drivers,” pushing a “New Normal” in the food industry, providing both challenges and new opportunities for manufacturers and retailers.
In each region of the US studied (Midwest, Northeast, South, West), the divide between consumers with traditional drivers versus evolving drivers are all roughly half, with the Midwest having a slight majority for consumers with traditional drivers (51%) and the West leading with a slight majority in consumers adapting evolving drivers (54%).
Age group and socioeconomic class also wasn’t a fragmentation force in the divide between traditional and evolving.
“Contrary to conventional wisdom, it’s not just the millennials or the most affluent putting these evolving drivers in the mix,” Jack Ringquist, principal, Deloitte Consulting LLP and global consumer products leader, said.
“Our research reveals that the preference for these attributes does not differ by generation, income level or region, but is pervasive across these groups. The US consumer has changed in a fundamental and impactful way, and people’s preferences are becoming even more fragmented than the food industry may have anticipated.”
What’s next for manufacturers and retailers?
Potential implications forecasted by the report include a continued fragmentation of consumer tastes and preferences and the increasing role retailers play in influencing consumer decisions.
As consumers’ tastes change, so does the market environment. A Credit Suisse report said that the top 25 branded food manufacturers lost 3.5% market share from 2009 to 2013. In addition, consumer trust, as reported by Deloitte’s 2014 Social Media Survey, found that consumers are 3.4 times more likely to harbor negative sentiment about food companies than a cross-industry average.
“[The] research clearly highlights a seismic shift in what consumers expect from the food and beverage industry. And these changes will require a response of equal magnitude from retailers and manufacturers to help meet consumers’ evolving needs,” the report’s summary of recommendations said.
“Real transformative change—far more than typical attempts at dabbling with new initiatives—is needed, which in turn will require companies to make difficult choices and significant investments. Given the ongoing nature and trajectory of consumers’ evolution, it’s eminently clear that for retailers and manufacturers seeking growth, doing nothing is simply not an option.”