Retailers have an opportunity to capture more sales of “Free-From” products as consumers increasingly view them as healthy alternatives to more traditional fare.
Gen-Y consumers in particular — and especially Millennial-aged mothers — are interested in products with “clean” labels and foods that lack certain additives and ingredients. This generation of shoppers equates “health” with simpler product formulations and Free-From claims.
“Overall, consumers perceive foods with any Free-From claim to be both healthier and less processed, thereby meeting two of the industry’s largest trends head-on,” Mintel said in a recent report on consumer preferences around Free-From foods.
The report found that for these younger shoppers — and for shoppers with children in the household in general — the elimination of chemically complex or unnatural ingredients was even more important than the addition of healthy ingredients.
The study found that 60% of Millennial consumers (age 18-38) agreed that they “worry quite a bit about harmful ingredients” in the food they buy. That rate decreases among older age groups. For the oldest consumers studied (age 70-plus) only 35% said they worry quite a bit about harmful ingredients in their foods. The rate was 55% for Generation X (age 39-50) and 46% for Baby Boomers (age 51-69).
Millennial moms were more concerned than Millennial dads, the research found.
When asked why they buy foods with Free-From claims, 50% of Millennial-aged mothers said they wanted to avoid unnecessary ingredients, vs. 30% of Millennial-aged fathers. Likewise, 45% of Millennial-aged mothers said they buy the products because they are healthier, vs. 37% of Millennial-aged fathers.
Not only are Millennials gravitating toward these products, but they are also interested in promoting the ones they enjoy, retailers say.
“We find that Millennials are very specific about the brands and the products that they love, and they champion those products,” said Rachel Shemirani, VP of marketing, at San Diego-based Barons Markets.
Barons is known for its curated selection of gluten-free offerings.
When it comes to selecting gluten-free products, Millennials tend to do extensive product research online, and then become devotees of the brands that meet their needs, Shemirani explained.
Following Millennial gluten-free enthusiasts on social media can help retailers stay on top of product trends, she said.
“They are the talking about the products they really want,” she said.
Scott Owen, grocery merchandiser at PCC Natural Markets, Seattle, said that although the company doesn’t track purchases according to consumer demographics, he agrees that younger consumers are more likely to speak about about their ingredient concerns.
“Younger shoppers do seem to be more vocal in their concerns about what is in their food, particularly specific ingredients, or — in the case of animal products — animal welfare concerns,” he said.
Interest in GMO-free
The Mintel survey found that among all consumers, interest in products free from genetically modified organisms outweighed interested in all other Free-From claims, including soy, tree nuts and/or peanuts, and eggs.
Susan Viamari, VP of thought leadership at Chicago based research firm IRI, said she believes consumer interest in non-GMO products will be long-lasting.
“I think non-GMO is definitely going to have staying power in the marketplace,” she said. “It’s something we get a lot of questions about, and it’s still very much a growing trend.”
She described a “huge move” toward simpler ingredient lists overall in the CPG space.
“Consumers want to understand what they are eating, or what they are cleaning their house with,” she said.
Speaking at Natural Products Expo East last fall, John Grubb, managing partner at Sterling Rice Group, said retailers have an opportunity to take more control over communicating a health message to consumers as manufacturers struggle to keep pace with these growing consumer demands.
“There’s a real gap between what consumers are asking for and what is primarily in the center of the store,” he said.
Grubb noted that Sterling Rice Group’s research has found a shift toward more mainstream interest in Free-From foods.
“Things that used to be ‘fringy’ features of diet — such as gluten-free, free from allergens, and non-dairy milk — these are no longer bundles two standard deviations from the mean,” he said. “Now you have mainstream consumers who are not necessarily the proactive health and wellness seekers who are consuming these products, in many cases as a treatment for a disease or a condition. So, that’s a very significant change in that regard.”
Grubb said he expects more activity in promoting these trends among retailers.
“I would expect retailers to take things into their own hands more and more,” he said.