Is it time to redefine your product portfolio? You bet it is!

 

Valerie Oswalt, president of Campbell Snacks, spoke at Groceryshop, which was held September 19-22 in Las Vegas. She shared that over the past two years, Campbell’s eliminated 577 SKUs, which was 16% of its portfolio. 

“This allowed us to free up line time to innovate and provide excitement,” she said, referring to the company’s efforts to be active in the limited-time-offering space. “LTOs are about providing an elevated experience. Think of them as the core product with a plus.” 

At that same meeting, c-suite executives from almost all retail chains, along with a fair share of CPG brands, were put in the hotseat for 10- to 20-minute interviews to share insights and plans for the future. To read about “Three CEOs forecast the future of retail,” link HERE.

My ongoing meta-analysis of consumer research confirms a message I communicated again and again as a keynote speaker at the QCS Purchasing Cooperative Annual Conference in San Diego earlier this week. And that is that consumers want to be in control and right now they are focusing on controlling how they spend their food dollars. They are in the process of “Redefining Value,” per Innova Market Insights’ Top-10 Trends for 2023. With budgets stretched and supplies under strain, brands need to be flexible in action and open in spirit to connect with consumers.

Today’s shoppers are increasingly exploring money-saving strategies, such as choosing lower-cost items and cooking from scratch. But they remain determined to sample new experiences, ensure personal well-being and support planetary health. There is more pressure on brands and manufacturers to deliver value while still meeting these wider public expectations. 

“Redefining value throughout the food and beverage industry will lead in 2023 as consumers seek brands that listen, understand and respond to their core values,” according to Lu Ann Williams, global insights director at Innova Market Insights. “They want brands that provide quality, trust and confidence via their product formulations, communications and wider sustainability actions.” 

It is paramount that you understand where your customers draw the line on compromise when it comes to value. As the cost-of-living crisis continues, brands can achieve success through actions that combine economic benefits with clear health and sustainability goals, according to Williams.

“Consumers’ expectations of brands are probably higher than ever,” said Andrew Wardlaw, chief ideas officer at MMR Research. “Every purchase your customers make is going to be more scrutinized than ever, and expectations from your product are most likely to be higher than at any other time. 

“Brands must think about strategies that help build the more distinctive, less substitutable product experiences of the future,” he said.

The number-two trend according to Williams is “affordable nutrition.” Shoppers are turning their attention to simple but nutritious foods that are affordable. Key behaviors include buying in bulk, opting for private labels, cooking from scratch, reducing spending on luxury items and purchasing fewer items. Consumers are actively looking for affordable ways to maintain a healthy diet, offering brands many opportunities to test their capabilities to new limits. To meet the nutritional, environmental and economic demands of consumers, manufacturers must innovate to extract maximum value from raw materials and the production process.

“The cost of living in a crisis is incredibly difficult, but consumers are seeking a revival of that feeling of awe and wonder that has been lacking for the past couple of years,” said Jennifer Creevy, food and drink director at WGSN. “Disrupt and break the design laws for your brand.”

That brings us to the new narrative on plant-based foods. And this really should not be too new to you if you read my blogs on a regular basis. 

“The rapid rise of the plant-based sector has hit some roadblocks, necessitating a refocusing on consumer demands for high-quality, flavorsome products,” said Williams. “No longer merely a mimic, green gastronomy will blossom as a standalone sector in 2023, giving brands significant opportunities to diversify and expand. Consumers still want to see improvements in taste and texture, but there is a huge appetite for culinary creativity and worldwide flavor profiles.”

That rapid rise can be blamed on the pandemic. The two trends that were just gaining mainstream momentum at the beginning of 2020—plant based and keto—were put into fast-track mode because of consumers’ need to control something, anything. 

“The pandemic amplified loneliness,” said Eve Turow-Paul, author of “Hungry: Avocado Toast, Instagram Influencers, and Our Search for Connection and Meaning,” and executive director of Food for Climate League, at the Plant Based World Expo in New Your City in early September. People are looking for control. And food is a way to belong to a community.”

In case you were unaware, Merriam-Webster added 370 words in September 2022. While not legal from a regulatory perspective, addition to the dictionary suggests that these terms have become mainstream.

Merriam-Webster explained the addition. “When many people use a word in the same way, over a long enough period of time, that word becomes eligible for inclusion.” 

One of the words is “plant based,” which is defined as being made or derived from plants; consisting primarily or entirely of food (such as vegetables, fruits, nuts, oils and beans) derived from plants. Another is oat milk, which is defined as a liquid made from ground oats and water that is usually fortified (as with calcium and vitamins) and used as a milk substitute. Soy milk has been recognized for a long time by Merriam-Webster. 

What does this mean for dairy processors? Well, for starters, it’s time to embrace the fact that plant-based is here to stay, and “milks” are a point of entry for consumers into plant-based eating and a part of every retailer’s lineup, according to Meghan Barton, director of frozen for Kroger.

While they are here to stay, the new narrative on plant based is that brands must support the environment. It’s no longer enough to just be animal free. The plant-based heroes of today and tomorrow are transparent about nutrient density, sourcing, water use, carbon footprints, supply chains and much more.

To read more about how to stand out in the plant-based crowd, link HERE to an article I wrote for Food Business News. 

Register HERE to hear Williams present all of Innova Market Insights’ Top-10 Trends for 2023. The webinar will take place Wednesday, November 9, 2022, at 10am EST.