The Ar­rival of ‘Free-of’ Food

Con­sumer de­sire for trans­parency is be­hind this up-and-com­ing trend.

Progressive Grocer (India) - - Contents - By Carol Radice

Know­ing where their food comes from — in­clud­ing how it’s grown or raised, and what went into it — is in­creas­ingly im­por­tant to con­sumers, who are just as at­tracted to what’s in a prod­uct as what’s not. When it comes to pur­chas­ing fresh foods such as meat, seafood, dairy, pro­duce and deli/pre­pared foods, the cleaner and sim­pler the pro­file, the more ap­peal it holds.

Some are call­ing this bur­geon­ing trend the “free-of” move­ment and pre­dict that its abil­ity to pos­i­tively af­fect fresh food sales will be sig­nif­i­cant in the com­ing months.

Ac­cord­ing to Mea­gan Nel­son, as­so­ciate di­rec­tor for Nielsen Fresh’s growth and strat­egy team in New York, the over­ar­ch­ing theme driv­ing this move­ment is con­sumers’ need for trans­parency. “Peo­ple just want to un­der­stand what’s in their food and how it is pro­duced,” Nel­son says. “They want to know where the pro­duce was grown, who the farmer is, how the beef cows or chick­ens were cared for, and what they were fed.”

Con­sumers are clearly aware of, and mak­ing con­scious de­ci­sions about, what they put in their bod­ies th­ese days. Re­search con­ducted by Schaum­burg, Ill.-based Nielsen in 2016 found that 67 per­cent of con­sumers want to know ev­ery­thing that’s go­ing into their foods. In ad­di­tion, nearly three-quar­ters of con­sumers — 73 per­cent — feel pos­i­tively about com­pa­nies that are trans­par­ent

about where and how their prod­ucts are made, grown or raised. More than half of con­sumers — 68 per­cent — said that they’re will­ing to pay more for food and drinks that don’t con­tain un­de­sir­able in­gre­di­ents.

Seek­ing Clar­ity

While it’s true that Mil­len­ni­als and Gen­er­a­tion Z are a key force be­hind the free-of move­ment, Nel­son be­lieves that what’s hap­pen­ing is big­ger than that, point­ing out that con­sumers of all ages are look­ing to have more clar­ity in what they pur­chase. “Peo­ple are so dis­con­nected [from] the food sys­tem that know­ing where a prod­uct is com­ing from, what’s in it and what they are putting in their body gives them some piece of mind,” she says. “Ul­ti­mately, it is about feel­ing good about the de­ci­sions they are mak­ing and be­ing con­fi­dent that the food they are spend­ing their money on is safe.”

Food fear is a real is­sue to­day, notes Mindy Her­mann, a New York-based regis­tered di­eti­tian nutri­tion­ist. She adds that so­cial me­dia is play­ing a key role in much of the fear­mon­ger­ing hap­pen­ing to­day and driv­ing con­sumers’ de­sire to learn as much as they can about the food they eat. “Peo­ple want to know if prod­ucts have been ex­posed to or con­tain things such as trans fats, hor­mones, an­tibi­otics, pes­ti­cides or added sugar, so they can make ed­u­cated de­ci­sions about what they are buy­ing,” Her­mann says. “The more they know about where the steak came from, or the salmon, or the milk, or their pro­duce, the more as­sured they are that the food they’re buy­ing is fresh and safe.”

When he looks at the trends driv­ing dairy and meat, David Browne, a Sacra­mento, Calif.-based mar­ket re­search and re­tail con­sul­tant spe­cial­iz­ing in the nat­u­ral and spe­cialty food in­dus­try, finds that as­pects such as grass-fed, hu­manely raised and

Peo­ple are so dis­con­nected [from] the food sys­tem that know­ing where a prod­uct is com­ing from, what’s in it and what they are putting in their body gives them some piece of mind. — Mea­gan Nel­son Nielsen Fresh

an­i­mal wel­fare are lead­ing the charge. Sup­port­ing his as­ser­tion are data from the most re­cent “Power of Meat” sur­vey from Food Mar­ket­ing In­sti­tute and the North Amer­i­can Meat In­sti­tute, which found that con­sumers’ de­sire for trans­parency in meat and poul­try pro­duc­tion is be­hind the dou­ble-digit growth in grass-fed, or­ganic, and hor­mone- and an­tibi­otic-free meats. “What this tells me is that clean, sim­ple foods are be­gin­ning to show up on con­sumers’ radar,” Browne says.

While the free-of move­ment has been brew­ing in the nat­u­ral chan­nel for a while, Browne notes that it’s just start­ing to make its way into the main­stream. “Planned or not, this is play­ing right into the hands of Mil­len­ni­als, who want this trans­parency and thrive on the back­story of who this farmer is and how was this turkey or pig raised,” he says, adding that the free-of con­cept may be sus­tain­able in the nat­u­ral chan­nel, but trans­lat­ing it to gro­cery — where vol­ume de­mands are much higher — could pose a chal­lenge.

Re­gard­ing cur­rent trends, Browne says that nongmo and even gluten-free are still ex­pe­ri­enc­ing what he would call a growth phase, and pre­dicts that it will be sev­eral years be­fore con­sumer in­ter­est maxes out. “It may be near­ing ma­tu­rity, but we are

still a long way off from see­ing ei­ther of th­ese trend down­ward,” he ob­serves.

Shout it Out Loud

For free-of to take off, prod­ucts will need to be ag­gres­sively mer­chan­dised on-pack and in-store. “I’ve seen this hap­pen in other de­part­ments, such as bak­ery, where re­tail­ers re­ally strug­gle with how to iden­tify and prop­erly mer­chan­dise cer­tain so-called ‘health­ful prod­ucts’ in a way that makes them clearly dis­tin­guish­able from the other of­fer­ings,” Browne says. The other road­block to growth, he adds, may be store per­son­nel: “Con­sumers are will­ing to pay more for prod­ucts they feel res­onate with their val­ues and be­liefs, but if none of the em­ploy­ees are able to an­swer shop­pers’ ques­tions about the item, then you risk los­ing the sale.”

Above all, Browne ad­vises that for the free-of move­ment to work, there needs to be buy-in from the top and con­sis­tent mes­sag­ing across all fresh de­part­ments.

To pro­mote free-of, Her­mann sug­gests that re­tail­ers con­sider us­ing lim­ited-time of­fers (LTOS) as a way to con­vey fea­tures such as fresh­ness, sea­son­al­ity, grown lo­cally, made in small batches and avail­able for just a short pe­riod of time. “LTOS are well suited for an end cap or spe­cialty re­frig­er­ated case, and can be mar­keted in a way that en­cour­ages shop­pers to check back with each shop­ping trip,” she says, not­ing that de­vel­op­ing an easy-to-iden­tify in-store or on-pack free-of sym­bol would also be a move in the right di­rec­tion.

“Con­sumers want short cuts,” Her­mann as­serts. “They may have a long list of prod­uct at­tributes that ap­peal to them — or don’t — but at the end of the day, they want a quick and sim­ple way to dis­tin­guish who the good guys and bad guys are.” Em­pha­siz­ing the free-of as­pects, she adds, is an ideal way to mar­ket to th­ese con­sumers.

True Value

Fur­ther, given the de­clin­ing in­ter­est in pur­chas­ing meal kits from on­line com­pa­nies, this is an op­ti­mal time for gro­cers of­fer­ing their own meal kit pro­grams to boost their value-added ap­peal. Her­mann notes that as a group, Mil­len­ni­als may not cook much, but pre­pared foods are an at­trac­tive sub­sti­tute be­cause they look like some­thing that they would make them­selves if they could cook. Giv­ing them the back­story about the in­gre­di­ents used in a dish, in a way, re­places hav­ing their own story, Her­man says. “In­stead of telling their hus­bands, wives or din­ner guests that the meat loaf they are serv­ing is grandma’s se­cret recipe, they can say the meat loaf is store-bought but comes from award-win­ning, grass-fed cows that have been pas­ture-raised since birth at Mcdon­ald’s Farm in Pa­d­u­cah,” she of­fers as an ex­am­ple.

Con­ve­nience, Her­mann adds, doesn’t negate con­sumers’ in­ter­est in know­ing as much as they can about where their food comes from. “If you want con­sumers to pay a pre­mium for your fresh pro­gram, you need to do more than sim­ply pro­vide prod­uct — you need to stress authen­tic­ity,” she points out.

But more im­por­tantly, for food re­tail­ers to ben­e­fit from the free-of move­ment, in­dus­try ob­servers such as Nel­son stress that they must make sure to com­mu­ni­cate the prod­ucts’ value propo­si­tion. She re­minds us that the more con­sumers un­der­stand about what they’re buy­ing, the more con­nected they feel — some­thing that’s par­tic­u­larly true in fresh de­part­ments. Also, given the num­ber of op­tions con­sumers have to­day, Nel­son says that it would be­hoove gro­cers to tout the spe­cial­ness of the prod­ucts they carry.

“High­light­ing or show­cas­ing what is and isn’t in the food, how it’s made and pro­duced, would go a long way in help­ing re­tail­ers dis­tin­guish them­selves in the over­crowded, highly com­pet­i­tive pre­pared food mar­ket,” she ob­serves. “At the end of the day, con­sumers still want con­ve­nience, but they want to un­der­stand what is unique about the pre­pared food their gro­cer is sell­ing. The more dis­tinc­tive it is, the more likely they are to buy it from their gro­cer ver­sus an­other mer­chant.”

Look­ing for­ward, Nel­son pre­dicts that as on­line re­tail­ers push to take a big­ger bite out of su­per­mar­kets’ share of busi­ness, gro­cers may look to cut back on cen­ter store square footage even fur­ther, to make room for more fresh of­fer­ings. “This is re­ally where gro­cers shine, but to com­pete near-term will re­quire them to ded­i­cate more space to ed­u­cate and demon­strate the value state­ments within the fresh space,” she says. “This is a crit­i­cal next step if they hope to keep shop­pers in the store longer.”

Con­sumers … may have a long list of prod­uct at­tributes that ap­peal to them — or don’t — but at the end of the day, they want a quick and sim­ple way to dis­tin­guish who the good guys and bad guys are. — Mindy Her­mann Regis­tered Di­eti­tian Nutri­tion­ist

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