Affluent Consumers in the New Economy: Food and Foodservice
The economic turmoil that reached crisis level in fall 2008 has been a bull in the china shop of American consumer behavior, even for a market as fundamental as food. Food spending, fueled by price increases but dampened by consumer cutbacks, took on a volatility that matched the chaotic economic trajectories of American consumers. Even within the affluent cohort of upscale-to-affluent U.S. adults ($75K+ individuals; $100K+ households), as of first quarter 2009, nearly a fifth described themselves as significantly worse off than they were a year ago, and nearly a fourth described themselves as somewhat worse off..
Focusing on this upscale-to-affluent U.S. cohort, Affluent Consumers in the New Economy: Food and Foodservice examines how responses to economic turmoil are affecting consumer demand for food products and chain restaurant services. Notably, for example, affluent consumers who have taken a financial hit are more likely to shop for organic and natural foods, and are more sensitized to ethical consumerism issues. In addition, affluent consumers whose financial situation has recently worsened or improved show higher levels of health and nutrition consciousness, as well as a keener taste for food adventure. In an era of widespread economic turmoil, such psychographic responses to financial setback and financial recovery will shape and transform consumer spending on food.
The effects of economic turmoil are being seen not only in which types of food products consumers are buying, but in which retail channels and chains they are flocking to. Although affluent consumers remain less likely than the rest of the population to shop at Walmart supercenters, they are shifting to Walmart at above-average rates, making supercenters an ever-bigger part of the equation for marketers of affluent foods. At the same time, shopping patterns for Trader Joe’s and warehouse clubs show the heightened potential for adventurous but value-priced store brands among the affluent cohort.
The effects of economic turmoil are also presenting broadly felt and widely reported challenges to the foodservice industry. Even within the current environment, however, specific segments of affluent consumers are more receptive to healthy fast food and more likely to find that fast food fits their current lifestyles. Therefore, the true task for restaurants is to match supply to demand, rather than to create or maintain it. Successful foodservice strategies must accommodate generationally and regionally inflected economic contexts, food landscapes, nutritional psychographics, and consumer lifestyles.
Overall, consumers who have been set back or thrust forward financially are more likely to be thinking and rethinking about what they need, what they want, and how and where best to find it. For marketing and customer communications, as discussed in this report, more is now more.
Read an excerpt from this report below.Report Methodology
This report is primarily based on original research and analysis. The analysis of affluent consumer trends, demographics, and psychographics derives from custom extraction and cross-tabulation of data collected by Experian Simmons (New York, NY) in its Winter 2008/09 National Consumer Study (fielded from late July 2008 through late March 2009), which is based on 13,128 U.S. adult respondents. In addition, this report draws on recent Packaged Facts consumer market studies, as well as relevant data from various government, business, and trade sources.