In the $75 billion-dollar specialty foods market, forecast to grow by 50% over the next decade while other food sectors remain relatively flat, an insightful new report has just been released. And for food and beverage companies, there’s A LOT to like about it.
Today’s Specialty Food Consumer 2008, developed by the National Association for the Specialty Food Trade (NASFT) and Mintel International, cites that 56% of American consumers are currently purchasing specialty foods and beverages—offerings the report defines as “distinctive” in taste, such as premium and ethnic products.
With the average specialty foods consumer now spending $115.50 weekly (an 8% increase from 2006 figures) and allocating nearly 23% of their food dollars for specialty products, the findings illuminate a set of lucrative new trends, including:
Youth Segment Drives Demand
The report found that people between 18 and 34 are the most likely buyers of specialty foods. While head-of-household mothers are a prime target for food retailers (and are well represented in this age demographic), brand managers have long held the youth demographic of 18-24 as the “holy grail” of markets for building brand loyalty.
Moreover, the youth market is especially primed to become “brand evangelists” who discuss new food preferences over the water cooler at work as well as through “online water coolers” like blogs, social networks and Twitter. This pays brands back in spades since this market can act as a veritable sales force.
Americans Want New Tastes… But Tradition Runs Deep
A key finding from respondents was that 86% of specialty foods consumers like to experiment with new recipes; yet 80% said that family food traditions are important to them (with nearly 25% of purchases being imported brands).
This is consistent with the key premise of Salad Bowl Branding that consumers who adopt the traits of American culture do not lose the ties to their heritages, but keep them very much alive through their foods. Moreover, both of these figures signal huge opportunities for brands that leverage innovation as well as those that honor tradition.
Home-based Foods Purchasing On the Upswing 
The report also cites that 6 out of 10 specialty food purchases by consumers are for “everyday meals at home.” Combine that with a weak economy pressing consumers to return to home-based food preparation that is 2/3 less costly than dining out–and we see consumers yearning for more variety that they can create at home.
And while respondents noted “taste and quality” have the most influence on their specialty foods purchases, consumers are no doubt also looking for competitively priced products, too.
So, what does this mean for YOUR brand’s packaging strategy?
In short, specialty foods have achieved mainstream status. No longer only bought by cultural and ethnic markets, specialty offerings are now purchased, adopted and anticipated by wide-spanning segments. In fact, according to Agri-Food, 75% of the sales generated by ethnic foods already come from mainstream customers.
What these new set of statistics prove is just how vast the opportunities are—in nearly every cultural origin and at nearly every price point—with innovative and traditional food offerings alike. And when we couple these figures with the explosive growth in America’s populations, we find that there’s never been a stronger time for specialty foods and beverages companies to make their mark.
Yet in the average supermarket, housing between 40,000 and 50,000 brands, packaging is your single best shot at grabbing this market’s hearts, minds and market share. But branding doesn’t take luck, it takes a thoughtful strategy.
