The ever-fickle consumer may be even more difficult to predict in 2009, given the dismal state of the economy and the seating of a new administration.
The ever-fickle consumer may be even more difficult to predict in 2009, given the dismal state of the economy and the seating of a new administration in Washington, D.C. Yet, predictions of consumer buying behavior run rampant, particularly when it comes to food choices. Many consumers are reportedly trading down from premium products to discounted, value-based options-a trend likely to affect commodity-type products more so than specialty, custom items.
Still, brand loyalty goes a long way. A study of supermarket shoppers recently released by Precima, a Toronto-based retail analytics firm, indicated only 32 percent of consumers had switched from their favorite brands to value brands during the economic crisis. As a result, it is important for grocers to understand what brands are important to consumers, the study suggests. In addition, this statistic underscores the priority bakers should place on ensuring their brands are foremost in consumers' minds.
The Precima survey also estimates fewer than half of the consumers who switched from favored brands to value brands will continue to do so after the economy improves. Here again, bakers should not focus on the negative, but search for opportunities. Easy for me to say, I realize, but there are always avenues to explore.
Seeking out potential areas for cost savings became more of a priority than ever last year during unprecedented rises in commodity and fuel prices. Many packaged goods manufacturers resorted to small reductions in package sizes in an effort to lower costs, without alerting the customer to any significant product changes. This trend in reduced packaging aligns with the larger push toward reducing waste, particularly in this new era of sustainability.
Yet cost reduction isn't the only way to entice consumers to your brand, as a value-added approach might be just as effective. Adding functional, healthful ingredients to baked products is driving consumer demand and appears to be a trend with staying power. Not only are consumers seeking products with fewer so-called “negative” ingredients, but they are reportedly searching for those with added healthful benefits.
Traditional baked products appeal to consumers' need for comfort during tough economic times. One source predicts a demand for “old fashioned kid favorites,” such as peanut butter folded into brownies. Other potentially trendy comfort-baked foods include cheesecake and shortbread desserts, as well as natural, wholesome baked products made from locally sourced ingredients.
Although our current economic climate is filled with uncertainty, hope remains for the baking industry. Fortunately, price isn't everything as consumers continue to base shopping decisions on quality and brand loyalty.