Food and drinks firms ‘will have to redefine how they promote goods’

Food and beverage companies will have to redefine the way they promote their goods to ‘older consumers’ if they hope to grow sales this year, according to Leatherhead Food Research.

While many food and drink companies are predicting sales growth in emerging markets, specialist UK-based food sector analyst Leatherhead is warning its industry clients that they may need to revisit their marketing pitch to older European consumers to avoid losing sales in what is for many companies their most lucrative market.

The 55-plus age group is markedly different to the 75-year-old consumer group, it said.

Leatherhead strategic analyst Matthew Incles said that food and drink manufacturers will need to be more accurate in the way they address their core senior age customers. He said global population change patterns are leading to a growth in this older age category, a reality which companies should ignore at their peril.

Mr Incles said: “Health is not the only focus, so too is packaging adaptation and segmented communications that appeal but don’t patronise. We think the time is right to redefine age.

“For the most part, ‘older consumers’ are defined as 55 and above, but are then assumed to have the same needs and wants as those aged 75 and upwards, even though that clearly is not the case.

“Emerging market growth in 2013 — due to rising populations, life expectancies, urbanisation, economic output and consumer spending — will be offset by sluggish European growth.”

The Leatherhead research also suggests that consumers will increase their scrutiny of the use of salt, fat, and sugar in food and drink products, particularly in those products which carry ‘healthy’ claims on their packaging.

Health and wellness will continue to remain front and centre in 2013, with an emphasis on natural products that are additive and preservative free.

As a result, manufacturers will continue to develop natural and clean labels whenever they are able. Functional and “free-from” foods will continue to grow.

Mr Incles said: “Our research shows that consumers want to see proof, verified by independent science, that the product lives up to its promise.

“Achieving this is more likely to be critical to continued market growth.”

In the US, economic output is expected to rise at 2% per quarter during 2013, with a reduction in household debt and rising consumer confidence, the research states.

“However, a rise in food prices will still cause US consumers to be concerned about the cost of food, and it will be essential for manufacturers to market good value.”

Other trends to drive the food and beverage market in 2013 include sustainability, including issues such as energy use, raw material sourcing, the environment, human and animal welfare, waste, and water usage.

Ethical claims will remain important as sales of fair trade have been increasing, as well as claims that demonstrate welfare standards, provenance, and bio-diversity.

Overall, even when money is tight, consumers are not compromising on ethical issues, the Leatherhead research states.

Additionally, consumer perception of ingredients will shape the market as the presence of certain ingredients may increase the value proposition of a product to consumers or likewise damage the value proposition if a consumer has a negative impression of the ingredient. Understanding these perceptions will be key.