Taste Matters

Nutritious or not, consumers still want their enjoyment foods

CHICAGO -- Despite the influx of health-focused food and beverage products produced each year for retail-store shelves, U.S. consumers are still spending one-third of their consumer packaged goods (CPG) food and beverage budget on products consumed for pure enjoyment rather than nutritional value.

According to a recent study by Information Resources Inc. (IRI), Americans' strong desire for taste, indulgence and variety has sustained spending and consumption of certain enjoyment food and beverage categories.

The report, [image-nocss] titled The Enjoyment Factor: Consumers' Unwavering Demand for Taste, Indulgence and Variety, delves into the movement of this marketplace, which has seen heightened spending on these categories.

There are substantial opportunities to grow 'enjoyment category' spending, said Janet Eden-Harris, executive vice president and global chief marketing officer for Chicago-based IRI.This latest report provides a rich analysis of enjoyment-category trends as well as implications for the marketing of healthy/nutritional products.The report empowers manufacturers and retailers with the visibility to see new trends and take immediate action to capitalize on current and emerging opportunities to improve performance.

According to the report, 43% of consumers place taste above health benefits in the purchase decision process, signaling the requirement that healthy foods must meet or exceed taste expectations in order to increase share of consumer spending and consumption.Additionally, the study reveals growth potential within the enjoyment-food and -beverage sector as today's consumers are reportedly striving to balance their diets with indulgence of desserts and snacks.

Demographically speaking, households with children spend more on enjoyment products than those without, due to larger household sizes. Moreover, baby boomers and older generations allocate much more of their spending on enjoyment categories than Generation Xers and echo-boom adults, with the disparity in spending driven not by health concerns but by difference in the types of enjoyment products consumed, such as higher-priced wine and spirits for older adults and lower-priced salty snacks and carbonated beverages for the younger generation.

In terms of channel selection, drug stores and mass merchandisers, which hold an above-average share of the enjoyment marketplace vs. total food and beverage, represent a sizable competitive threat to grocers across these categories and a potential upside for enjoyment-product manufacturers.The report also encourages retailers to make certain that their enjoyment category product mix is in alignment with their core consumers' preferences, as there appears to be major generational differences in the channels consumers choose to purchase their enjoyment foods and beverages.

To read the full report, please click here.