It’s rare that trends happen in a vacuum and have no effect on broader markets or categories. And when we look across the U.S. brick-and-mortar retail landscape, recent data from Nielsen’s Total Food View highlights how consumers’ desire for health, wellness and convenience are driving growth across the store.
While the foundations of these trends remain steadfast, they are evolving. And that means fast-moving consumer goods (FMCG) businesses in every area of the store, from dairy to deli to bakery, need to evolve as well.
For example, frozen meats were the original source of convenience in grocery stores. Over time, prepared foods stepped up and have developed into an increasingly prominent and important contributor in terms of on-the-go convenience. As prepared areas gained traction, rotisserie chickens and pizza flooded deli counters. But over time, once again, consumers sought out greater variety as palettes blended. Today, health and wellness are center stage, and competitive offerings abound both in and outside of the market’s retail walls.
To meet demand, retailers began offering sushi stations and rolls, which were met with rapid success. Today, poke bowls—even stations—along with unique combination plates, are providing complete meal solutions to complement and/or compete with the rise of meal kits. They’re also fueling sales growth. While traditional sushi sales have slowed from the 12% it averaged each of the past three years, poke bowls and poke stations, often complemented by Negiri or other sides, posted dollar sales growth of 9% for the 52 weeks ended June 30, 2018.
And with the recent implementation of new menu labeling requirements from the FDA, which provide transparency to the consumer through nutrition facts and calorie counts, options will evolve further within prepared foods. For the calorie conscious, the new labeling could inspire green growth, as we’ve seen sales increases among deli prepared vegetables, salads and lettuce salads over the past year.
But menu labeling changes aren’t the only dynamic influencing health and wellness trends. Diet trends also play a role in the products shoppers are buying, and rising interest in keto and paleo diets have augmented a new protein craze—a factor that’s giving a boost to specific products that denote their protein power. For example, dollar sales of dairy items touting protein claims have increased 12%, a marked growth relative to the department’s overall 0.7% growth.
Plant-based diets are another recent trend, and plant-based alternatives are emerging as viable options across all areas of the store, from salty snacks to dairy yogurts and milk. They’re also meeting consumer needs, as just under 40% of Americans say they are trying to increase the amount of plant-based foods they consume. Today, almost 15% of food and beverage sales come from products that sustain a plant-based diet. And in some instances, providing growth in categories that are declining overall. For example, sales across the yogurt category were down 3% at the start of April 2018, but plant-based yogurt sales were up more than 30% on a year-over-year basis.
But what role does health and wellness play in more indulgent categories? While Americans are striving to be healthier, they also love a good snack. But in many cases, U.S. consumers are just as mindful about transparency in the snack aisle as they are elsewhere in the store. Products with specific claims are growing at faster rates than those without claims, and clean-label trends, which focus on excluding certain undesirable ingredients, are making their way into snacks.
For example, sales of clean-label refrigerated cookie dough are up 20% in the 52 weeks ended June 30, 2018, and sales of clean-label baking mixes are up 40%. These growth figures could prove inspiring for the fresh bakery area, which appears to be an open field opportunity for clean-label offerings.
Trends can transcend department walls as they offer sources of competition or inspiration for innovation. It’s critical to understand the holistic picture to develop a comprehensive consumer management strategy. And with the rapid evolution of trends, the ability to act on current trends while identifying and preparing for emerging ones is crucial for a pipeline of success.
The insights in this article were derived from the following sources:
- Nielsen Product Insider, powered by Label Insight
- U.S. Homescan Panel Protein survey, April 2017
- Nielsen Retail Measurement Services