The Supermarket Guru, Phil Lempert, activates his 100,000-plus consumer panel each year for the National Grocers Association (NGA). He presented the Top 10 food trends for 2012 at the NGA convention on Feb. 12. A few of these trends apply to why craft brewed beer is expected by many to continue solid sales growth, and others make me wonder if there is a way for craft brewers to develop strategies based on certain trends.
Top 10 Food Trends for 2012
1. Food prices will continue to rise, pushing consumers to become smarter.
2. Never shop or dine alone. The mobile American has handheld tools to keep a network with them even when unaccompanied.
3. The baby boomers keep on truckin'. 76 million baby boomers will control 52% of the $706 billion to be spent on food in 2015. Cheech and Chong are even repping Fiber One. Damn.
4. Celebrity chefs are done. Farmers are the new food celebrities, and this encourages more emphasis on "local" and "farm to fork."
5. The end of the checkout lane. Mobile capabilities will allow greater self-checkout. Also flash sales will grow as a marketing tool.
6. Ethnic food revolution. Food trucks are driving discovery and excitement. Expect to see partnerships between food trucks and supermarkets.
7. The new role of the male shopper. 41% of at-home meals are now prepared by men.
8. Xtreme home cooking. People take pride in making the most for the least and cook-and-save is gaining popularity.
9. How sweet it isn't. Less sugars is an emerging trend in the American palate. Nutritional labeling will include both total sugars and added sugars.
10. The sound of food. Consumers have an idea of sound showing the freshness and readiness of food. Think of the sound a crisp apple makes when you bite into it. Multisensory perception is a new food science. There is research into the sound of bubbles in a soda and the perception of healthfulness.
The panel that followed the presentation was stumped by the question of what will be next to supersede the trend toward all things local. Local is expected to only grow. Awareness of where a product comes from only shows signs of increasing. That bodes well for craft brewers who continue to work in their communities and/or partner with farmers. Beer drinkers will be looking deeper at the labels and care even more about where their beer is being made.
The Feb. 8 issue of Beer Business Daily looked at the growing importance of authenticity. One statement from that piece (based on a Progressive Grocer article) from Joseph Pine, author of "Authenticity: What Consumers Really Want," was "Authenticity is ... becoming the new consumer sensibility, the buying criteria by which consumers are choosing who they are going to buy from and what they are going to buy." Is there/will there be a backlash if the people feel that large brewer brands that compete in the craft styles are not authentic because the companies don't put their names proudly on the brands? The growing importance of authenticity makes me wonder about private label brands. Will there be a backlash against stores that dedicate space for private label rather than authentic craft brands? Private label has shown a tendency to commoditize products where it has been successful, such as green beans. Sales of private label were down for supermarkets, yet we saw more private label brands enter the beer category. The last thing that we need for the beer industry is to be perceived as more of a commodity, and one wonders if the sluggishness of standard lager and light lager sales in America is partly due to a sense that many of the brands are so similar as to not matter.
Another point from the session was that there is zero tolerance for error in comsumer products, quality is where it's at, and service can be a huge differentiator. Value was defined along the following equation:
Value = Quality, Price, Relationship and Service.
Again we are back to the strengths of craft brewers. High quality, relationships of the brewer with the beer enthusiast community (which influences many more) and delivery at or beyond expectations with the flavors in the bottle. Craft brands that succeed may be dependent on what the bottle delivers combined with what the brewery delivers in reputation and community particiaption.
I also want to comment on Number 9 in the trends list above. If the American mind and palate are truly moving away from sweet, are we already seeing that in the 40%-plus sales growth of IPAs in sales data? Does the future of flavored malt beverages move further to a niche part of the TTB-defined beer industry? Sugar, fat and sodium depress the tastebuds. Will craft sales growth go further and faster as Americans eat and drink smarter? Will soda decline in beverage share of stomach, creating opportunity for other drinks?
Another factoid delivered in the panel is that when someone "likes" a brand on Facebook, there is a 36% higher likelihood they will buy the brand, so engaging more in social media conversations can help as a differentiator. Another brand idea is that consumers have a very high primary store satisfaction. I suspect that craft brewed beer drinkers have a set of go-to brands that they think about buying and feel great about. That plan may change once the beer buyer is faced with the offerings and specials and seasonals in beer section in a store. There is also room for add-on buying of dinner bottles or other six-packs or spirits or wine or imports or domestic lager and light lager. The beers purchased must deliver every time, or they are out of the consideration set. I know logical argument principles exclude taking the specific and applying it to the general. But there is one brand of tequila I will never buy again no matter what the price because I felt betrayed by the quality a year ago, when the brand lost the taste I had come to expect. Bye.
I also think the idea of primary store/brand satisfaction can apply for brewpubs and beer bars as well. People have go-to establishments that remain in their consideration set every time they go out. The brewpub/bar/restaurant/tavern is under pressure to deliver great food and beer every time to stay high in that consideration set. Brewpubs and better beer bars have the advantage of great beer and can often "steal" customers from establishments that don't have the savvy to deliver quality draught beer and delicious food every time.
February 13, 2012