According to a report released last week by consumer research platform Attest, about 60% of Americans are struggling to afford food as price hikes intended to offset inflation limit what they can buy. , in what quantity and where they do it.
Realizing that many consumers feel stuck and facing volume shortfalls, FMCG manufacturers and retailers are rethinking their marketing strategies, with some opting for more promotions and others playing the long game and maintaining prices stable even if they lose market share in the short term. .
In this episode of FoodNavigator-USA’s Soup-To-Nuts podcast, Todd Fellerman, chief commercial officer of Attest, shares the findings of the consumer research company’s report released September 13: “Coping with Food Insecurity : a guide to changing consumer behavior for F&B brands and retailers.’ It explains who is struggling to afford food, how it affects their purchasing habits and loyalty. It also sheds light on how people of all socio-economic and regional levels approach cooking in today’s economic environment and what they look for from brands as they balance both their budgets and their lifestyles. more and more loaded. And finally, it offers tips for attracting and retaining consumers in today’s landscape.
Inflation May Be Slowing, But Food Prices Aren’t Falling
According to data released last week by the Department of Labor, consumer prices for food eaten at home in the United States increased 0.2% in August from the previous month – somewhat slower than July’s 0.3% month-over-month increase, but a reversal from July’s 0.3% month-over-month increase. slight decrease in flat rates from one month to the next since February.
These numbers, while still not what most would like, are well below last summer’s double-digit year-over-year increases – suggesting the economy is slowly recovering while the costs of raw materials and inputs moderate slightly. But, as Fellerman points out, there is a lag in the response to inflation across the landscape, including when it comes to consumers’ paychecks and the prices they see on store shelves.
“Where overall inflation appears to be slowing, we found that when it comes to paying at the pump to pay at the grocery store, many consumers are still struggling and, overall, people are having to make these difficult things. choices,” he said.
Shoppers are buying less food, sacrificing nutrition for calorie density
Fellerman says that for grocery shoppers, these difficult choices often focus on less quantity and lower quality foods.
“(Consumers) are finding that their dollar isn’t going as far at the checkout, and they’re trying to find a way to (stretch it),” Fellerman said, adding: “The other interesting thing we found in research shows that nutrition for some people in certain segments of the United States is becoming less and less important because they say, “I don’t want to be interested in nutrition.” I’m just trying to find a way to keep that food on the table as often as possible.’
While Attest’s research shows the impact of inflation and rising food prices is hitting consumers across the board, with less than half of the population saying they can afford to eat comfortably, Fellerman notes that the brunt of the impact falls on Generation X and less affluent buyers.
Based on these findings, Fellerman advises brands and retailers to tailor their marketing and promotional efforts to regions and generations. For example, Attest suggests in the report that Millennials, who have the highest purchasing frequency, are most responsive to in-store promotions, while more affluent shoppers who are willing to visit multiple stores to find deals will respond good for coupons.
Consumers continue to eat at home and get inspiration from videos
Fellerman notes that consumers tightening their food budgets for grocery stores and FMCG brands has the benefit of more people cooking at home and cooking from scratch, creating opportunities for retailers and manufacturers to interact with buyers around the pleasure of cooking.
“We’re actually seeing that cooking at home (is) something that almost all Americans – socioeconomically and regionally – are doing, and that’s positive in some sense,”» said Fellerman.
Fellerman says one of the best ways for retailers and food brands to tap into consumers’ joy of cooking is to use digital recipes and video tutorials on platforms like TikTok to teach consumers how to use products and prepare pleasant meals at home.
Additionally, it highlights the power of prepared foods as a way to attract younger shoppers who feel time-strapped and older shoppers who have more income.
Offer inspiration at your fingertips
In this regard, Fellerman also advises brands and retailers to make recipes accessible not only from a technical perspective, but also financially, which could involve incorporating ways for consumers to extend a meal or prepare something nutritious but also affordable.
It also recommends that brands diversify where they advertise and offer promotions to encourage consumers to shop across channels and purchase at dining locations where they might not otherwise have their purchases before.
To learn more about how the economy is influencing consumer behavior and how retailers and brands should in turn adjust their innovation and marketing strategies, visit askatest.com and view the full published report this week: “Coping with food insecurity: a guide to change.” consumer behavior for brands and F&B retailers.