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This paper sets out to share Bord Bia’s understanding of the global consumer today, the consumer attitudes and behaviours that are likely to continue over the next three to five years, and how the meat industry can use this consumer knowledge to successfully innovate and identify opportunities for growth.
Bord Bia is an Irish government agency established in 1994. Its mission is to drive the success of a world class Irish food, drink and horticulture industry through strategic market development, promotion and information services. Bord Bia works in partnership with the industry to promote and develop markets for commercial advantage.
Bord Bia’s Consumer Lifestyle Trends
Bord Bia has worked in partnership with The Futures Company to identify six Consumer Lifestyles Trends that resonate today and give strong indications of what he next three to five years will entail beyond the recession. These trends come from an understanding of the macro forces shaping the lives of consumers around the world such as social, technological, economic, environmental and political factors, and from an understanding of the on the ground consumer and brand behavior that occurs in response to these drivers. They are supported by empirical evidence including a quantitative study covering 18 markets and 80% of global GDP, and on the ground views from over 40 cities in every continent of the world.
They take in the key drivers shaping consumer lives around the world, such as the rise of new media and communications technology, and the declining trust in government and big business.
The Consumer Environment Today
Knowing and understanding our consumers or end users allows us to better predict and prepare for consumers’ future needs and wants. Consumer trends help companies be more outward-looking, future-focused and act as a catalyst for new thoughts and ideas. Today’s volatile environment means that understanding the consumer has never been more important. Much has changed over the past eighteen months around the world. But is important to consider what is just a function of today’s economic crisis, and what represents a fundamental shift in the way consumers will engage with the marketplace going forward.
The recent experience of frugality will lead to period of penny-pinching and thrift that will define the character and mindset of the marketplace for some time to come. Today, consumers are more considered and constrained in their purchasing behaviour; the emphasis is more on coping. However tomorrow we can expect a more positive environment. Consumer confidence will pick-up and a frugal mindset will wane. More premium opportunities for growth will re-emerge as consumers focus on higher order needs again.
Navigating the challenges of today, and at the same time preparing for the longer term are the two critical challenges facing organisations. Today it is about getting the right message to the consumer regarding your value proposition and avoiding devaluing your brand through fighting just on price and / or cutting quality. Evermore important is getting smart innovation quickly into the market that meets consumers’ needs today.
But we must also plan for the longer term. A critical challenge for all businesses is building genuine lasting value that is relevant for your consumers and customers. You must ensure that you are well placed for growth when it returns and bring new innovation to the market rather than offer incremental improvements.
The Six Trends
Consumer Trend: “I want to stay in control of my busy life and make sure that I am at my best for whatever the day presents”
The first trend is Fluid Lives. As the pace of life continues to accelerate, work and leisure time are blurring and people constantly struggle to meet the demands of the many roles and activities in their daily lives. Economic anxieties have now been added to the challenges of a complex world and busy day. People are increasingly looking for ways to simplify their lives; in today’s world it can be a way to get back in control and free head space for other issues. Consequently, the desire for convenience and simplicity remain, but, solutions are limited by the money people have in their pockets. A need to perform to our best, especially in the workplace, remains. People are looking to show they can survive under the pressure. Taking time for ourselves has become a necessary strategy to keep a sense of balance in life; down time needs to be planned if only for a small moment in the day.
Consumers now take an average of just 13 minutes to prepare a meal at home, a significant difference from the 1983 average of an hour. Time out to re-charging energy levels is increasingly important - a recent study concluded that day time naps produce significant advantages to brain concentration. A short afternoon catnap of 20 minutes will be enough to boost alertness, mood and motor skills.
Convenience is no longer king, were money can be saved people will find a practical solution. According to the Italian farmers’ union Coldiretti, sales of dough to make bread and pizza bases at home are soaring in Italy, as people try to cut down expenses on eating out and convenience foods. Frozen meals gained a 6% value growth in the UK in 2008, as consumers look for cheaper alternatives that allow them to maintain convenience.
Beyond the recession, the desire for greater convenience will re-emerge as more prosperous times return. However, people will have a better sense of what they can do for themselves quickly and cost effectively. A new form of convenience may emerge were people will be prepared to do some of the work themselves. Consumers will want high quality produce available when they need it, and to be able to access it with a minimum amount of effort. Existing technology will play a greater role in saving time: highlighting when temporary stores are in place such as the farmers market; and notifying people when fresh produce is available.
  Consumer Trend: “I need to balance the stresses in my everyday life with experiences that are fun and fulfilling”
As people lead ever busier and stressful lives, they increasingly look for solutions that provide an antidote to the pressures of modern living. Free time continues to be a precious commodity that needs to be used wisely. As the financial crisis continues, people are seeking strategies that change the focus of life back to them, and help them to feel better about the world, reigniting their positive outlook on life.
Whilst people are still seeking to enrich their lives with experiences that excite, push the boundaries and stimulate their senses, the tone has shifted more toward the need for respite, distraction and a little fun in life. Experiences are still highly valued, but, must easily fit into daily life and crucially; be low cost. There is less money for conspicuous consumption. Remy-Cointreau has reported a 7.5% fall in turnover in the second quarter of 2009, reflecting the fall in global champagne sales which have dipped by nearly €10m.
But people still need a way to release pressure and bring some fun back into life. Flash Mobs have become a free and fun way to bring a little laughter back into life. The eighth annual No Pants ride had 1,200 participants in New York and well over 1,000 more in 21 other cities across the globe. Food continues to be a great outlet for creativity, exploration, and play. A new magazine, Eat In, capitalises on the growing UK obsession with home cooking and exploration. Jamie Oliver has also recently published his own Jamie Magazine to encourage experimenting with cooking at home.
The recession may have awakened people to the fact that many of life’s great experiences are often free. Today the home can be a great place to connect with the people that matter in life, and a cost effective place to have fun. Eating out may have to offer more than just the usual restaurant experience.
There are some interesting global examples of this trend in the marketplace - Flash mobs have reached new levels of ambition. A couple are given a surprise wedding reception outside Office of the City Clerk in N.Y. - music, food, drink and guests were all provided. Kellogg’s launched a competition where families were invited to submit photos of them baking something with Kellogg’s cereals. The winning families were decided on those who appeared to be having the most fun. In the US, they call them supper clubs; in GB they are underground restaurants; in Cuba, paladares. They are a cross between a restaurant and a dinner party - like a restaurant, in the sense that you pay; like a dinner party, in the sense that you are in someone's house.
 
Consumer Trend: “I would like products that create less negative impact on the world; I want choices that make me feel good without harming my wallet”
Sustainable Lives is the next trend. Whilst people are increasingly aware of the negative impacts of consumer culture, the welfare of the wider world has become less of an immediate concern. The short-term priority has shifted to addressing the challenges created by economic crisis and issues closer to home.
Companies and brands supporting good causes or with more environmentally friendly approaches remain aspirational, and a desired choice for many were the cost still makes sense. Many people are increasingly shifting their attention toward the issues that impact their local community, pushing the bigger and trickier environmental issues back to the manufacturers and retailers to solve. In some instances, as prices rise, some greener choices have become smart choices; choices that ultimately save money in the long run.
Rising prices have brought home the connection between consumerism and sustainability. A focus on value has meant some positive choices have had to be put on hold. According to data from TNS World Panel, sales of organic produce have fallen by up to a third since the start of the recession. Organic producers are also seeing their share of the grocery market shrink. Charity now has more of a ‘homely’ feel. Buying local is gaining support across the world.
What might the next 2-5 years entail? People will continue to scrutinise companies for the impacts they make, but, will not expect the costs of improvement to be passed on. Less impact will be more important that offsetting impacts: bringing alternative energy into the production process such as factories running on wind power and alternative methods to distribute products like by bicycle are likely to emerge.
Manufacturers are likely to need to take greater ownership of their waste. Ensuring waste can be recycled or recycling for the customer is likely to become more common place. Packaging that is bio-degradable or reducing packaging could be more common solutions. Developing schemes to re-use food wastage, for example as fertiliser could emerge. Supporting local may become stronger shorthand for sustainability and supporting worthwhile causes.
 
Consumer Trend: “I want to be in control of my health and wellness, to manage or improve it through making better choices”
The Quest for health and wellness remains a key consumer trend around the world but is perhaps somewhat different today to what it was five years ago.
As modern lifestyles create new health challenges, maintaining or improving health and wellness has become a well established priority in many people’s lives. As health infrastructures feel the strain of rising demand and falling support, the responsibility for people to find their own path to good health has become more important. New York State has announced plans to tax manufacturers who contribute to obesity, in the form of an 18% levy on non-diet soft drinks.
The economic crisis has shifted the focus of health and wellness toward managing the basics. Staying healthy and avoiding illness is the current priority where the cost of care is high and time out from the workplace may represent a risk. Higher order health needs have been put on hold for a while. An increasingly balanced lifestyle approach is emerging as people seek to take control of their own health. Change4Life is a UK society-wide movement that aims to prevent people from becoming overweight by encouraging them to eat better and move more.
Navigating the choices on offer remains complex, many people are seeking more simplistic and cost effective approaches. Basic nutrition and, more traditional and natural solutions continue to grow in popularity. For the three months that ended December 2008 nationwide retail sales of vitamins and supplements were up almost 10 percent from the same period in 2007. That included a nearly 6 percent increase in sales of Chinese herbal supplements alone.
Beyond the recession, natural and pure will continue to represent a healthier choice. Haagen-Dazs has a new line of ice cream called ‘five’, and each flavour has only five ingredients and no additives or preservatives. As another bonus, they have 30% less fat that the traditional variants.
 
Consumer Trend: “I like to pursue better value, to help maintain my lifestyle and to get the most from the money I have”
The proliferation of choice and information has empowered consumers, allowing them to be more selective in their purchase decisions. Rising economic anxieties and financial constraints have lead to greater scrutiny of the market place, driving a stronger focus on value and a need to make smarter choices. Deciding what is good value has become more complex. The relationship of quality to price remains. However; trust, familiarity, provenance and even wider environmental and social concerns can now form how a consumer sees value.
There is more shopping around and trading off convenience for a better price. Sales at discount retailer Aldi climbed by 15% in 2008 compared to the previous year. M&S’s shift in focus from ready meals and convenience foods to offering a greater range of basic ingredients reflects the increasing shopper desire to do more for them and forego convenience and higher prices.
A changing sense of what represents value means that buying own brand is an increasingly popular consumer strategy for saving money. Many retailers offered dining in solutions - restaurant quality meals for one low price with great wines by the bottle to compliment.
Room for luxury and indulgence remains. Cheaper does not necessarily mean better. Big splurges have been replaced by more considered choices; a desire for discernment is still strong and rarely now expressed by buying the most expensive option. L’Oreal recently reported growth of 5% in like-for-like sales of its lipstick lines. The ‘Lipstick effect’ shows that in a recession sales of lipstick do well, as consumers opt for accessible luxuries whilst cutting out bigger ticket items.
The pursuit of value is likely to remain even after the recession and what represents value will always be more than low price. People will want to deepen their knowledge of production, and even be prepared to get involved in the processes, to get better value and build their expertise. Products that offer a luxury experience will increase in appeal again as prosperity returns. Innovation should focus on adding genuine value and experience to product ranges through the full user experience.
 
Consumer Trend: “I am looking for products and brands that are real and authentic, because they have stood the test of time and remained true to their heritage; they provide me with comfort and reassurance”
As the recession continues, people are looking to the past for stability and reassurance. Uncertainty and harshening times have created a heightened need for brands and products that are trustworthy, open and honest.
A more traditional and down to earth form of authenticity has emerged. The tried and tested are becoming more essential anchor points for consumers, comfort comes from products that have continuity with the past and that have stood the test of time. Old ways offer the real experience and a means to a simpler and more self sufficient lifestyle.
The past offers us something real and a simpler time absent from the superficial excesses of today. There was a 4% increase in the sales of Artic Rolls last year and a 5% rise is predicted this year. Cadbury’s reported sales growth of 5%, which the company attributed to Wispa's renaissance in 2008.
A deepening connection with our food offers both the ‘real’ experience and a means to be more self-sufficient. For every UK allotment plot there are 30 people waiting to get their hands on one – providing evidence of our recession-fuelled enthusiasm for home-grown produce and the desire of many city dwellers to embrace "the good life" by getting back to the land. A patch of the South Lawn at White House has been turned into a vegetable garden, the first at the White House since Eleanor Roosevelt’s victory garden in World War II.
Our appreciation of artisan skills has deepened and there is a desire to re-learn what the past taught us. Darina Allen has championed Grandmothers’ Day - a day dedicated to remembering and recording lost skills and wisdom of previous generations.
Beyond the recession, new forms of growing your own emerge - meaning that local and seasonal become greater features of life. The growth in more collective forms of ‘locally grown’ emerge to make food more affordable and change the use of common land; the home becomes more of a ‘farm’ house where experts help people find the right solution for the spaces they have.
Consumers may look to secure their supply by sponsoring or seeking ownership of the authentic source and innovative methods of producing emerge, allowing consumers to practice traditional techniques and stay closer to the original and natural produce.
Many examples of this trend exist already - Hugh Fearnley-Whittingstall is championing the sharing of land for crop growth. Le Verdure Del Mio Orto lets anyone build an organic garden on their farm. Land sufficient for 1–2 people costs €850 per year and up to 40 different types of vegetables can be chosen. The Beehaus is designed to enable consumers to keep their own honey bees in their garden or on their rooftop, ensuring that the final product is as natural and un-tampered with as possible.
Implications for the Meat Industry What might all of this consumer understanding mean for the meat industry?
We must return to the two critical challenges facing businesses and entrepreneurs and compel ourselves to think in consumer terms. Answering the following questions about the meat industry and the product offering will hopefully begin to help.
For today, taking into account the current consumer behaviour around the world, can your industry offer people distraction and moments of calm in the day? How can your products bring experience to everyday life? How can your products help people be more resourceful with money they have? What are the naturally occurring ingredients within your products that offer protection against everyday illnesses? Does your brand allow you to communicate these benefits effectively? How strong are your local connections?
In planning for the future, a stronger focus on growing ingredients and food may remain. How can you make this convenient for modern lifestyles? How can you support a balanced lifestyle that treats the health and wellness of the mind and body as one? How can you utilise packaging solutions that keeps the food as fresh and natural as possible? Can you make you production process more transparent? How can you reduce the environmental aspects of your products?
Can you connect people to land or allow them to take share of a production source? Can you make the production process more transparent?
Hopefully this relatively quick look at the consumer trends will help your organisation make sense of, and plan for change, and also act as a catalyst for new thoughts and ideas for your industry.
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