What, Exactly, Is Value to Today’s Shoppers?

Circana, FMI and Oliver Wyman unite to identify definitions, opportunities across eating occasions

3/18/2024

A new study shows that consumers value price, convenience and wellness on the same spectrum.

Determining what consumers want to eat and drink is an endeavor as old as, well, the first stores and eateries. As the food landscape has evolved over the past few years – in some ways, dramatically – addressing shoppers’ preferences and needs has become a priority and a task.

To get to the heart of purchase-driving behaviors, a group of industry experts recently collaborated on a fact-finding project. Chicago-based research and insights firm Circana (formerly IRI and The NPD Group) partnered with FMI - The Food Industry Association and consulting firm Oliver Wyman to identify trends and subsequent opportunities for industry stakeholders to align on what consumers value in the current marketplace. Each organization brought its own expertise and perspective for a well-rounded look at consumer drivers through the study, “Finding Growth for Food & Beverage at Retail: Winning Eating Occasions throughout the Day.”

“Part of what came out of an FMI growth forum last year was the need to clearly understand the different changes in the industry, including consumer behavior. With IRI and NPD coming together, we have the ability to look at the complete consumer, which allows us to understand what is going on at home and away from home,” explained Sally Lyons Wyatt, global EVP and chief advisor, consumer goods and foodservice, at Circana, noting that the company had a strong working relationship with FMI.

Based on such holistic information, the joint research project revealed that the definition of value is changing, even in an inflationary era. “Value means more to people than just price, as they are looking for more value in what they invest in,” she added. “It’s value for money, convenience, and health and well-being. They are all inextricably linked.”

The New Convenience

Convenience, too, is more broadly interpreted. “It’s huge both in and out of home,” asserted Lyons Wyatt, adding that ease of use covers more than just grab-and-go options, as it was a decade or so ago. “It can be, ‘What can I eat while I am streaming’?”

Health and wellness are tied to the value proposition for eating and drinking, too, the research affirmed. “You can see it with some of the choices people are making,” Lyons Wyatt said, citing an example of the popular functional beverage segment. “It’s part of the reason why beverage has done so well – it’s not just hydration, it's hydration plus brain, hydration plus gut.”

While health has been an influencing factor for many years, consumers are taking into account more aspects of their well-being, she added. “The difference is how consumers embrace their physical, mental and emotional well-being. That wasn’t what we did five years ago,” she reported. For example, the research found that 33% of what consumers eat is motivated by fuel, 20% by wellness, 21% by desire to connect and 21% by gratification, among other drivers. Translating into eating occasions, many respondents said they focus on fuel and wellness for breakfast and snacks and emphasized connections for dinner.

Optimizing Occasions

The study delved into meal and snack occasions, uncovering other common habits in the evolving food landscape. Linked to convenience, 65% of morning eating occasions are prepared in less than five minutes. When it comes to making evening meals, the survey showed that people are finding ways to simplify the process with five or so ingredients and lower-prep, quick-cleanup methods.

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Given value that spans pride, convenience and health and wellness, CPGs and retailers can succeed across motivators and occasions with a multi-pronged yet coordinated approach to identifying and reaching consumers, Lyons Wyatt said. “It’s rallying around more occasions and helping consumers as they value convenience, health and well-being to balance all of that and deliver solutions,” she declared, underscoring the impact of an integrated, omnichannel approach that links what happens in the store to what happens online. “Also, retailers and CPG have such variety. There are very few places in the world that can provide you with such different cuisines every day.”

Mark Baum, SVP of industry relations and chief collaboration officer at FMI, also weighed in on the takeaways from the joint project. “The research showcases how food and beverages that promote well-being, those that are competitively priced and products that are decidedly convenient to buy and prepare, will ultimately earn shoppers’ allegiance,” he said. “We are witnessing shifts toward foodservice spending, a rise in digitization, and return-to-office protocols that all provide food and beverage retail with opportunities to improve how they deliver on what matters most to consumers.”