Marketers of organic, natural and healthy products should view the “tidal wave” of Latino consumers in the U.S. as a golden opportunity, according to Los Angeles family physician Luis Pacheco, M.D., himself a creator of a supplement brand. The 50 million Hispanics will impact health and wellness in the U.S., primarily because of their attitudes toward physicians, prescription drugs, and preventative care generally. Beset by obesity and diabetes, Hispanics generally do not visit the doctor until there is something wrong, and even then delay treatment because they cannot afford it, often lacking health insurance. Mistrusting prescription medications, Latinos prefer herbal products and other supplements. The opportunity for supplement makers is there, Pacheco says, as long as marketing and labeling are culturally relevant.

A Mintel study reveals that 44% of grocery shoppers believe that the quality of today's store brands is better than those of five years ago and 39% of respondents who are their households' primary shoppers say they would recommend a private label product. Also, significant majorities — 62% for dairy products; 61% for canned foods; and 56% for household cleaners — believe there are no quality difference between name and store brand products and just 19% say paying more for name brand products is worth it. Mintel says private label manufacturers continue to gain ground by introducing improved, budget-friendly products with enhanced packaging.

Packaged Facts has published Food Flavors and Ingredients Outlook 2011, its eighth annual look at the future of the US food and beverage market. It shows that consumers’ budget and health concerns will remain major factors this year. Core trends include an increase in demand for ethnic flavors; local and organic being driven by sustainability; food as a cornerstone of health; an increased focus on fruit and vegetables; and a greater overlap between sweet and savory. It also expects honey partly to replace agave as a sweetener. Other key drivers include higher food prices, a new frugality, government pressure to improve diet, and a better lifestyle balance that enhances general well-being.

A poll conducted by Mambo Sprouts Marketing has found that eco-conscious grocery shoppers have become suspicious of “natural” labels on food products and urge creation of standards for so-called natural products. The poll, conducted among 1,000 consumers of organic and natural products, found 34 percent of either “not very” or “not at all” confident in “natural labeling,” while 65 percent were “very interested” in seeing standards set or certification for products that are labeled “natural.” Thirty-three percent preferred oversight of natural labeling by an independent organization, while 27 percent preferred government oversight agency. As to recession-induced shopping practices, respondents said they will continue to shop for the best value on eco- and healthy products, clip or download coupons, and choose store brand organic products.

Commercial weight-loss companies are ramping up their advertising campaigns to promote new dieting programs to recapture former clients and win over new ones. Weight Watchers ($1.4 billion in sales in 2010), Nutrisystem ($527 million) and Jenny Craig ($480 million) rule the $3.2 billion commercial weight-loss center category but are not resting on their laurels. All three are rolling out innovations designed to entice dieters who switched to less expensive do-it-yourself dieting schemes during the recession. Nutrisystem’s new ad agency developed a campaign emphasizing real people rather than celebrities. Weight Watchers is pushing its refurbished calorie-counting system (PointsPlus), while Jenny Craig is touting its new Metabolic Max Program that customizes weight-loss programs to clients' "unique metabolism.”

India’s fast-moving consumer goods (FMCG) market has shown a strong recovery in the first six months of 2010-2011. After going through inflation, competition, and consumers’ skimping in 2009-2010, FMCG companies including Hindustan Unilever, Dabur India, and Britannia Industries are raising the prices of some their products. With consumers hammered by rising food prices during the previous year, FMCG companies had no choice but to lower the prices of some food and personal care products to maintain sales volume. This year, however, vendors expect a much improved market, buoyed by increased salaries in Indian corporations and stronger hiring expectations, along with a recovery in demand among rural consumers, helped by lower food price inflation and a good monsoon. 

Though the chocolate market seems to be recession-proof – global sales have risen three percent since 2008 – chocolate makers are not resting on their laurels. They are responding to consumer demand for healthier confections, and to a need for increased on-shelf product differentiation, with a host of innovations. According to Packaged Facts, chocolate makers developed portion-controlled packaging, sugar-free candies and heart-healthy chocolate. And companies like Barry Callebaut, NewTree and Azure Chocolat are developing chocolate products rich in functional ingredients, including omega-3s, calcium, vitamin D, flavonols, probiotics and superfruits. Chocolate is gaining credibility as a nutricosmetic because of its beneficial effect on wrinkles, according to Packaged Facts. If chocolate makers successfully tap into that market, it would add “another accolade to how versatile the 'Food of the Gods' really is.”

For the past two years, the Supermarket Guru®, Phil Lempert, has been working with one of America's top food companies, ConAgra Foods, to make market predictions. Previous years have showed 9 out of 10 of his predictions proved correct. There are six predictions from the guru this year, starting with stores providing applications for mobile devices to help with shopping decisions and checkout, supporting the general trends of value and convenience. Two additional predictions come in the form of easier to read nutritional information and a focus on foods naturally rich in vitamin-D, such as dairy. The remaining three predictions have more to do with store operations instead of consumer needs as he predicts stores will start displaying more foods with a regional rather than local focus, support more seafood coming from the Gulf Region, and increase the number of free in-store samples to help reduce new product failures.

Sports beverage makers are hoping that innovation focused on meeting the energy and nutrition needs of athletes will boost sales that have sagged during tough economic times. Market leader Gatorade (PepsiCo), for example, recently launched the G Series of sports drinks formulated to be consumed before, during and after workouts. EAS’s Peak line of beverages promises that its nutritious ingredients give athletes with the ability to push through workouts with less fatigue while protecting muscles from breakdown. Attitude Drinks Inc.’s Phase III line of milk-based, ready-to-drink beverages target the post-exercise recovery category. U.K. beverage marketing firm Canadean predicts that the sports drinks market will recover in 2010 and show a CAGR of five percent through 2015. Gatorade and Powerade (Coca-Cola) dominate the sports beverage market with a 95 percent combined market share.

Salty snacks – not usually thought of as health foods because of saturated fat, trans fat, sodium and forms of sugar – nevertheless are getting healthier. Snack makers have come up with a variety of products that claim to be organic, all natural, whole wheat, reduced-sodium, gluten-free and lower in fat. Some products are even earning higher scores on healthy food rating systems. Retailer Big Y says healthier snack products like Popchips are doing very well. The product is not fried or baked, but instead is made with a heat-and-pressure process that uses half the fat of fried chips and is seasoned with sea salt. Snyder's of Hanover, which sells better-for-you products like multigrain tortillas and veggies crisps, will soon launch several better-for-you snacks in 2011, including lower-fat and organic whole wheat nibblers.

Packaged grocery store salads, unheard of 20 years ago, are now a $3 billion a year business thanks to health- and convenience-conscious shoppers looking for value. Refrigerated dressings are also a hit, partly because producers have come up with innovative ways to link dressings with other grocery store sections. Besides fresh produce and salad packages, they can be placed near potatoes and cut vegetables, for example. Companies are cross-merchandising dressings, packaged salads and salad kits using coupons and other promotional methods. Salad producers are also doing their best to meet consumer preferences for all natural and even organic ingredients in salad kits and refrigerated dressings. According to Craig Hope of Calif.-based Earthbound Farm, organic options comprise 16 percent of the salad category, but only 3.7 percent in total food.

McCormick chairman, president and CEO, Alan D. Wilson, said in an interview that his company is charting large-scale expansion in India. Wilson added that the recession had no significant impact on the U.S. seasoning market, which doubled in the past 20 years. Asian markets account for 7% of the company’s business and McCormick hopes to increase this to 15% in the next five years. China, where McCormick has located its biggest operations in Asia, and India, where branded seasonings account for just 10% of a market valued at $5 billion, present the biggest expansion opportunities for the company. Wilson sees his company benefitting from the growing popularity of various types of cuisine worldwide. Meanwhile, McCormick plans to implement its recipe-driven sales strategy in India, from which the company sources some 40 spices including pepper.

Vertis Communications’ recent study, “Grocery Shopping In The New Economy 2010,” reveals that 57% of male respondents say they are their households’ main grocery shoppers, a 10 percent increase from a similar study in 2006, although 85% of women say they are. A majority of adult respondents say they still rely on newspaper inserts to choose which grocery store to go to and prepare their shopping lists, although just 46% of 18-34 year-old male respondents say they do so. Among respondents who are 35 years and older, 90% of women and 80% of men say they read grocery stores’ direct mail; and among these readers, about 75% redeem coupons. People still look to conventional supermarkets for perishables, although a growing proportion of shoppers are using discount stores and wholesale clubs and discounters and club channels are increasingly encroaching on supermarkets’ territory for non-perishables. Price remains the dominant factor in store choice in all groups.

Eco-friendly packaging has become a major trend among packaging manufacturers, consumer products manufacturers and retailers who are working together to promote cost-effective sustainability, even in a sagging economy. For example, the customers of a company that distributes organic foods like Silk soy milk are keenly aware of fair labor and trade practices, food miles, the environmental impact of products, and package recyclability, so the company keeps this criteria in mind when making procurement decisions. Even troubled companies like Winn-Dixie have kept sustainability a priority, relying on suppliers to maintain green standards. An executive at Winn-Dixie says financial condition shouldn’t stand in the way of principles: “It is finding the niche in which, relative to your space, you can play a role in sustainability, that makes the right sense for a business model.”

Chinese companies, many of which are state-run, accounted for 10 percent of the value of cross-border acquisitions this year. Cross-border deals often generate concerns, and the growth in the global influence of what people see as communist-controlled enterprises is regarded as unacceptable in some quarters, partly because many are worried that politics will influence decisions more than profits. Some countries, including Australia and Canada, are creating obstacles to Chinese investment, especially in primary industry. But there are good reasons why the trend should be allowed to continue. First, the current economic malaise in the world has been partly attributed to economic liberalism, giving a boost to those advocating more state capitalism. Second, Chinese companies are relatively new to the scene and far from being able to influence supply conditions significantly. Third, many state-run companies in China have to compete at home too, and competition in foreign markets should ensure that Chinese investments are profit-oriented. Fourth, some of the Chinese investment is coming from the private sector, such as Geely, the new owner of Volvo.  Finally, the global economy needs the capital and energy that Chinese investment should bring.

A survey conducted by Synovate revealed that consumers in the United States, Japan, and most of Europe are pessimistic about their economy’s future. In contrast, consumers from South America and Canada are quite optimistic. Results of the survey, which covered more than 18,000 consumers, found that sales, coupons and special offers can help some consumers overcome their worries and buy more, especially those in the U.S., Japan and most of Europe where outlook is poor.  Meanwhile, messages of hope and aspiration can lead South American and Canadian consumers into purchasing. 

Beset by wilting sales and lackluster financial performance, Kellogg Co. hopes to increase its lead over number two breakfast cereals producer General Mills with the introduction in the U.S. of a cereal sold for 30 years in the U.K. To be launched in January, Crunchy Nut with its “unique honey and nut flavor” gives the company a much-needed new product introduction without having to spend on research and development, according to analysts. The $6 billion cold cereals market has been depressed of late: dollar sales declined 2.68 percent in the 12 months ending in October, unit sales were off .22 percent, and the average box price dipped below $3.00. Kellogg still has 33 percent of the market, but General Mills isn’t far behind (31 percent) and is gaining share as Kellogg loses.

Despite tough economic times, U.S. sales of organic food and beverages were $26.6 billion in 2009, 5.1 percent higher than in 2008, according to the Organic Trade Association. The performance indicates that Americans are striking a balance between healthy eating and unhealthy spending. That’s a lot of organic food purchasing, and the volume is due at least in part to the fact that traditional supermarkets, club stores and mass merchandisers are showing increased sales. Those stores – Kroger, Safeway, Publix, Trader Joe’s, Walmart, Costco, etc. – accounted for 54 percent of the organic food sold in 2009, followed by natural retailers at 38 percent. Industry observers believe the retailers are doing well in organic sales because of their reputation for competitive pricing.

Organic sales in the UK rose for 15 consecutive years, only to turn down in 2009, but Mark Price, Managing Director at the retailer Waitrose, says organic food sales are rising once again. Price also indicated that consumers remain cost sensitive. To remain competitive, especially against Tesco, Waitrose offers around 800 promotions a month, with promotions accounting for 18 to 20 percent of store sales.  He also pointed to changing consumer preferences, mentioning that some customers now preferring to shop online, either with purchases delivered or for pick-up at the store.

New York City Mayor Michael Bloomberg and Governor David Paterson extended their fight against obesity and unhealthy diet choices by requesting approval from the USDA to bar use of food stamps to buy sugary sodas, sports drinks, sweetened teas, etc. in the city. Bloomberg and Paterson observed that using government money to buy “foods of little or no nutritional value …effectively subsidizes a serious public health epidemic.” New York City’s eight million food stamp recipients – roughly half the population – spend more than $75 million on sugar-sweetened drinks. More than half of the adult population and 40 percent of public primary school students are overweight or obese. The USDA denied earlier requests by Maine and Minnesota for similar restrictions because they were discriminatory against needy consumers.

Consumer flavor preferences in the juice, nectar, still drink and iced tea market are moving from away time-honored orange toward “a more diverse and interesting range of blends and ‘other flavors,' according to beverage industry information specialist Canadean. The process has been accelerated  by steep orange juice concentrate prices and the economic decline. Operators have turned to a wide variety of mixed fruit combinations of two or three different flavors that are less expensive. The share of orange has dropped to less than 20 percent of every five liters sold of juice, juice drinks and iced teas, down from 24 percent in 2005. Lemon is the second most popular flavor and is gaining ground due to popularity as an iced tea in Asia and an unpackaged still drink in India.

Companies are struggling to balance the need to raise prices to offset higher costs against fickle demand from price-sensitive consumers. A review by the Wall Street Journal found that across a spectrum of industries, businesses are grappling with pricing decisions, seeking to protect or boost profit margins without driving customers to lower-priced options.  Decision-making approaches vary from simple pragmatic methods to highly quantitative formulas, with global companies often evaluating prices on a market by market basis.  No matter the decision-making process, companies are monitoring price-sensitive consumers’ buying decisions very closely.  

U.K. sales of pies and pasties – a type of meat pie or turnover – have not been hurt by the recession, according to researcher Mintel. On the contrary, they are booming. Sales topped $1.4 billion in 2009 and could reach $1.5 billion by the end of this year. Sales rose five percent between 2008 and 2009, as British consumers dealt with increasing food costs by purchasing comfort foods that provided value for their money. The top three pie and pasty products are beef (55 percent), sausage roll (53 percent) and Cornish pasties 45 percent, Mintel found, noting that 84 percent had eaten a pie or pasty in the past year. A Mintel analyst said, "Consumers returned to the familiar as the economic downturn put a dent in their disposable income.”