10 November 2016
By Eliseo Barcas, vice president of sales, Tetra Pak U.S. & Canada
More than ever before, consumers are slowing down to scrutinize the labels of their packaged food items as they fill their carts at the grocery store. It’s a global trend, led by the Millennial generation, that is catching the attention of food and beverage producers everywhere. The consumer of today is reaching for items perceived as simple, nutritious and healthy.But what exactly does “healthy” mean? According to global consumer research firm Mintel, more than a third (37 percent) of consumers are confused about the information companies put on their labels, and even more (38 percent) are downright skeptical.
As a result of consumer confusion about terms such as “healthy,” “natural” and even “organic,” the U.S. Food and Drug Administration (FDA) has acknowledged the need to revisit their regulations around nutrient labeling. In September, the FDA began accepting comments on their request that the word “healthy” be removed from certain product packages due to the naturally high fat content found in ingredients like nuts.
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The FDA has made subtle but significant changes to its classic nutrition label, too, to emphasize when a product has added sugars versus naturally occurring ones. They’ve also made overall calories per serving more prominent and are recommending more daily fiber and vitamin D, and less sodium, in diets.
Companies that focus on presenting clean label products make it easier for confused consumers to trust their products—a move that builds brand loyalty in a competitive landscape. Clean label products contain fewer ingredients—often five or less—and do not contain ingredients that are unrecognizable to the average consumer. Simplicity is the goal with this trend, the concept being that less on the label means more to the consumer.
Demand for simple ingredients is undeniably driving sales: Natural, organic food is predicted to represent 14 percent of total food sales by the year 2020, according to Food Business News. This means that the way products are formulated, and how food companies brand themselves and their products to tout such benefits, is increasingly important.
More real = more appeal
In the U.S., Millennials are leading the charge to demand “free-from” food and beverages—free from GMOs, gluten, preservatives and more—with 49 percent saying products that make these claims are worth paying more for, according to Mintel.
Reformulating products to replace ingredients perceived as unhealthy, such as swapping out artificial dyes for natural alternatives, is one approach that food and beverage companies are starting to favor. Another way to simplify the ingredient list is to adopt aseptic processing and carton packaging to eliminate unnecessary additives or preservatives.
And beverage sweeteners such as maple syrup, honey, coconut nectar and dates are rising in popularity as consumers increasingly associate them with healthier products.
Embrace authenticity
For some consumers, reformulating products to include more natural, or fewer, ingredients may not be enough. Branding your company or product in a way that shows support for causes like the environment, health and nutrition is also key. Food packaging that tells an authentic environmental story to support the product positioning and the company’s commitment to simple, pure ingredients can go a long way in driving differentiation in a crowded retail space.
The takeaway for any food company big or small: Consumers are looking for companies that stand for something, and live their ethos not just in how they make their food, but in how they run their business and support their community.
By listening to what consumers want and embracing true authenticity, food and beverage companies can pave the way for a brighter future for all.
Eliseo Barcas, Vice President of Marketing and Sales, Tetra Pak, U.S., has extensive expertise in understanding and maximizing market trends and supporting customers through strategic portfolio deployment. For more than two decades, he has collaborated with customers and served as a leader on sales and marketing teams in Europe, North America and South America, focusing on fast-moving consumer goods and business-to-business sectors. He currently leads commercial and marketing efforts for Tetra Pak U.S., including defining strategy for the shelf-stable carton portfolio and directing its successful execution.Like being in the know?
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