Food Macro Trends
Trends in food can be a fickle thing – some are multiyear in duration, some are fads, which are here today, gone tomorrow. They can be classified as either “macro” or “micro,” the definition of which is influenced by both duration and underlying consumer motivation (or mindset) toward the trend. As a general rule, micro trends tend to be specific and of short duration (one to two years), whereas a macro trend is multiyear, more general in scope, and is the motivation for the consumer’s mindset. Macro trends also tend to demonstrate a bit more overlap with each other versus micro trends. For example, compare the low carbohydrate (Low Carb) macro trend versus the Atkin’s Diet micro trend from the mid 2000’s – Low Carb was (and, to some extent, still is) a consumer mindset that influenced most purchase decisions, whereas the Atkin’s Diet was a shorter term, specific application of that trend.
With that background in mind, one of the most prominent macro trends influencing consumer behaviors today is a distrust of big food companies. In the most general sense, the term Big Food refers to the collection of very large industrial packaged food producers, wielding large influence over market dynamics and public policy – companies such as PepsiCo, Kraft Heinz, General Mills, Nestle, etc. Big Food has gained this influence over the past 50 to 60 years alongside the rise of the large, central supermarket that has been driven by “middle aisle” sales of packaged foods. That dominance is being challenged today as consumers’ trust in Big Food is eroding due to a number of factors, some of which have evolved into macro trends themselves:
- A growing awareness of the link between health and food: Whether real or perceived, purchase trends indicate that shoppers are moving away from the “middle aisles” and more towards the perimeter. In the May 21, 2015 article in Fortune magazine, Special report: The war on Big Food, “the idea of ‘processing’—from ancient techniques of salting and curing to the modern arsenal of artificial preservatives—arose to make sure food didn’t make us sick. Today many fear that it’s the processed food itself that’s making us unhealthy.”
- Supply chain and manufacturing transparency: Take the biotech labeling issue, as an example – despite regulators and established scientific organizations declaring the safety of such modifications, consumers still wanted information via the packaging that indicates the presence of such ingredients. This resulted in the passage of the National Bioengineered Food Disclosure Law.
- Product and ingredient simplicity: Availability of information via the internet and social media has led consumers to question the need for the unpronounceable chemicals they see on labels of packaged food, believing that simple, understandable ingredients are fundamentally healthier.
- Lack of consumer belief in brand authenticity, mission, and/or purpose, especially from Millennials: Amanda Topper, a Food Analyst at Mintel (the world’s largest market intelligence agency), states in an October 29, 2015 report, “With growing distrust and a greater desire for transparency from food manufacturers, Millennials want brands to form a genuine, authentic connection with them and brands should recognize the impact Millennials have on their businesses.” Stated simply, the rise of Millennials’ influence has demonstrated a clear link between personal philosophy and the food they are willing to purchase.
- Access to and influence of social media: Increased social media use has led to online conversations about what to eat and what to avoid. This has led to the ability of self-proclaimed food experts/advocates to create enormous movements cultivated by connection to their personal food philosophies.
Big Food has taken notice of the macro trends, as evidenced by corporate acquisition strategies evolving away from building larger economies of scale to drive down cost of goods. Today, there is increased strategic focus on acquiring smaller brands operating in non-traditional sectors – natural, organic, etc. In addition, new brands are bringing something to Big Food beyond their product credentials – the DNA of the food entrepreneur, which includes both management and operational agility to respond to consumer demands, as well as a clear and obvious focus on their mission.
Consumers’ distrust of Big Food is a macro trend. In fact, consumer purchase behavior indicates that the trend is actually accelerating.