Welcome! Salad Bowl Branding provides briefings on America's shifting specialty food markets, the changing tastes of consumers, demographic and industry trends and growth opportunities in the consumer packaged goods sector.Learn More about us.
Ready to move ahead with your business? Check out the Summer Fancy Food Show education programs for 2010.
Beginning on Friday, two days before the trade show floor opens, NASFT proudly offers 23 quality sessions including tours, a tasting, roundtables, two value-priced packages of sessions aimed at start-ups and specialty food entrepreneurs and our latest series called Bite Sized Classes.
With the NEW Bite Size Classes, you’ll be able to take up to two of these 45 minute classes before the show floor even opens on both Sunday and Monday!
In addition to all of this, you’ll find information here about our prestigious sofi™ Awards Ceremony on Monday night!
Please note that classes are not included in the price of an exhibitor/attendee badge. For questions on classes, please contacteducation@nasft.org
The specialty food industry struggled in 2009 but still grew by 2.7%* with much of that growth coming in the fourth quarter.
As a consumer packaged goods marketer I keep an eye on specialty food sales, from the local retailers through natural food stores and supermarkets. For over 20 years I have spent the majority of my time working on ways to help specialty food products sell.
The data I have analyzed reveals a culturally authentic industry that continues to grow despite a daunting global economic recession. In fact, sales of specialty foods last year topped $65 billion, commanding over 13 percent of retail food sales. That’s great news.
KnoorReadytoServe
Better yet, if you sell refrigerated sauces, salsas and dips, you were (and still are) in great demand. Even if you don’t sell Yogurt or Kefir, the fastest growing specialty foods category, the primary question all entrepreneurial brand owners still have to ask is “how do I make sure my product attracts the right buyer?”
That’s where I come in. And on June 26th, if you register for my seminar at the Fancy Food Show, you’ll gain that answer, learn a few tactics and uncover ways to help your products sell better too.
Want some more great news? Come see me at the show.
7 Ways to Evaluate Your Product’s Branding and Packaging to Respond to Changing Markets
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Fancy Food Show
Saturday, June 26
10:30 AM-12:00 PM
Javits Center, NYC
Ethnic food sales will reach a record $2.2 billion this year, and advance by another 20% between 2010 and 2014 (Mintel).
Population growth has been growing steady for specialty foods since 2004, the global research supplier reports. Since 2005 more than 1 million foreigners have become permanent legal U.S. residents each year.
Mexican/Hispanic foods still dominate, holding a 62% of ethnic foods’ share. In fact, nearly six in 10 consumers now report that they cooked Mexican food within the past month. Clearly Hispanic foods have become so mainstream that they are “hardly considered ethnic anymore”.
Sushikid But the real growth-drivers in the Specialty Foods category are Asian and Indian foods, which showed 11% and 35% growth, respectively, between 2006 and 2008.
Wealth and youth are two of the strongest predictors of ethnic food cooking, with 92% of households with incomes of $150,000 or higher and 91% of consumers 18 to 24 reporting that they have engaged in such cooking within the past month.
Cooking shows, product innovations and more international travel have contributed to more Americans considering themselves cooking enthusiasts and experimenting with global cuisines and new foods/ flavors.
Two-thirds of respondents prefer to cook ethnic meals from scratch, but the remaining third prefer foods that require less time and preparation. Food manufacturers are encouraging the cooking trend by providing ethnic sauces and seasonings to add to home-prepared meats and vegetables, “or taking it a step further with meal solutions and pre-made meal kits,” notes MediaPost.
If the industry needs more proof that specialty foods is THE sector of growth in food and beverage, validation can be found through the vast array of niches that the sector is penetrating. Be it low-cost convenience or high-end luxury, specialty foods are gaining steam…
According to Time Magazine (April 3, 2008) “The specialty-food sector is growing as pantry goods that used to be basic commodities are being repackaged as upscale luxuries. Even as some people worry about being able to put any kind of food on the table, the sales of specialty foods are up 17% over the past two years (compared with 4% for overall food sales).
‘The financial situation hasn’t hurt us,’ says Andy Arons, CEO of New York City’s Gourmet Garage stores. ‘I don’t think that people necessarily skimp on eating well in hard times. Maybe 10 years ago, splurging on food seemed foreign, but when you are in a world where people pay $4 a day for a Starbucks coffee, an expensive butter doesn’t seem that extravagant.’
On the other end of the scale, even low-end convenience stores are using specialty foods to entice more palates, and more profits. Even 7-Eleven is hip to the profit potential of such comestibles.
As Rocky Mountain News reports, “Even 7-Eleven is going local. The ubiquitous convenience store is cooking up specialty foods for Colorado palates – such items as carnitas pita sandwiches, beef and green chili burritos and sugar cinnamon twist pastries.
The regional creations were on display for the annual ‘University of 7-Eleven’ gathering at the Colorado Convention Center on Wednesday, a traveling food and beverage show that gives 750 store managers and franchisees a sneak peek of new products and services.
“When I came to Colorado, the first thing I heard people talk about was the green chili,” said Jason Yada, a fresh food manager with 7-Eleven. “We wanted to make our burritos really authentic.”
The Colorado specialties are the latest way for 7-Eleven, once known primarily as a pit stop for sodas and smokes, to continue to expand into fresh foods such as sandwiches, salads and fruits. The Dallas-based chain, which has 220 stores in Colorado, last year posted nearly $47 billion in sales. ‘What customers see at a grocery store, they want to see here,” said Raj Singh, merchandising manager for 7-Eleven, pointing to a 24-pack of bottled water.”
When foods migrate from restaurants to low-end convenience stores and high-end luxury stores, the question is not if they’ll continue to move mainstream–it’s how fast and furiously they’ll continue to do so.
An article in AdvertisingAge by Tommy Thompson sheds some much-needed light on today's cultural markets in the U.S–most especially on the fact that while they may be of the same ethnic backgrounds, that is where many of their similarities end.
But, as Thompson points out, many of today's marketers are the last to know. Arguing that targeting as large a group as the 45 million Hispanics currently in the U.S., he explains that profiles based solely– and far too simply –on benchmarks like "Hispanic Adults ages 18-49" doesn't adequately reflect these groups' wants, needs, views or preferences.
"The reality is that the Hispanic consumer is not a homogeneous group and
therefore these types of broad statements won't work for most brands in
today's changing environment. In order to effectively connect with
today's Hispanic consumer, we must understand that there are
sub-segments united by common interests that make the whole. Let's say
there are niches within the niche.
There are in many ways vast differences between the
consumer of Mexican decent in San Antonio vs. one in Sacramento vs. one
in Dallas or one in New York (yes, there are Mexicans in New York).
Most importantly, there are differences in the strategies and tactics
that a brand should use to reach them and engage them.
The reality is there are many factors that our Hispanic consumers are exposed to that
shape who they are, what they like, what sports they play or watch,
what they consider entertainment, what brands they buy and the list
goes on, but you get the point.
Our job as marketers is to find the common thread that unites as many
consumers as possible so that we can be effective and efficient with
our client's dollars."
In this era of mass-market fragmentation, when marketers start digging deeper to better understand the various (and highly varied) new niches of consumers, their intelligence will pay off in both profits and competitive advantages. Innovating in specialty foods is an especially ripe opportunity due to two key reasons: first, it's clear these micro niches need to be better understood and, thusly, better served. And, second, specialty foods are not only being enjoyed by their niche of origin, but by mainstream audiences. Given that sales of specialty foods are up 17% over the last two years, compared with only 4% for overall food sales, we're already seeing success resulting from better targeting and branding.
Indeed markets are changing– as are the micro-markets within them –which begs the question for today's marketers…is your branding changing, too?
An article from The Wall Street Journal (May 1st) titled Surge in U.S. Hispanic Population Driven by Births, Not Immigration, illuminates just how profoundly the U.S. demographic shifts that are currently taking place will forever change the nation — and the breakneck speeds at which those changes are occurring.
The 45.5 million Hispanics currently in the U.S. are up from 35.7 million in 2000, with the growth among Hispanics responsible for half of the U.S. population gains between 2000 and 2007. While that increase is nothing short of astronomical, what is most surprising is how it’s happened. According the article:
“Hispanics now account for more than 15% of the U.S. population, and their surge is largely the result of births among people already in the country–not immigration. In the 1990s, a flood of Hispanic immigrants explained most of the group’s population rise. That has changed in recent years. Between 2006 and 2007, about 62% of the increase in Hispanics came from births.”
Hispanic families tend to have more children, while white families are having less. But what is also increasing is Hispanics’ purchasing power. As the article states:
“Growth in spending by Hispanics is likely to outstrip that of the general population in coming years. Hispanics control more disposable income than any other minority group. The figure stands at $860 billion a year and is expected to hit $1.3 trillion by 2012, according to Jeffrey Humphreys, who monitors Hispanic demographic and economic trends at the University of Georgia’s Selig Center.
Between their numbers and disposable income, Hispanics are already a vital market for politicians and marketers. But these numbers point to how they’ll only become more so. And while Hispanics are quickly redefining mainstream America, they’re also fragmenting into many micro-niches who seek products that align with their cultural heritage as well as the country they now call home.
That only leaves the door open for more innovations across many industries including television programs, music, fashion and, most notably, specialty foods. After all, our markets are changing, so too must our branding. Watch a three-minute video by The Wall Street Journalon the Hispanic market’s dramatic growth and its implications.
While news of the economic downturn is blazing the nation’s headlines the fact is, it’s only part of the current story. After all, the economy is not the only entity in America experiencing dramatic shifts.
With one-third of the U.S. population currently of minority status—a figure forecast to soar to half the population by 2050—a far larger story of change is occurring. And with sales of specialty foods rising 17 percent over the last two years (compared to only 4 percent of overall food growth), these long-term marketplace changes hold near-term implications for the specialty foods and beverages industry.
A look at many of the current trends tells the broader story—which includes opportunity, not just economic challenge:
Purchasing power increases. Minority market segments are not only growing in size but in spending power—and that power is pegged to fervently rise by 30 percent, to $1.9 trillion, within only three years. These markets are essential to the overall economy, and a key driver within our own sector.
The new “tastemakers” wield wide-ranging influence. With sales of specialty foods slated to grow by an astonishing 50 percent over the next decade, the real phenomenon is that 75% of sales generated for specialty foods are from mainstream customers, not the niche cultural segments originating the foods. Indeed, American palates are now influenced by an entirely new set of tastemakers.
Home-based dining poised for growth. Consumers don’t stop eating during a downturn, but they do adjust where they have their meals. This is good news for food producers as home-based food preparation is undoubtedly poised for an upswing. Moreover, consumers will seek more variety in their home-based diets since they will not be frequenting specialty and ethnic restaurants at the rates of the past few years.
A Look Back Gives Future Insight
As history has proven time and again, the economy will turn back around–just as the stock market took some steps toward recovery this week. But as history has also taught us, the chance to gain a strong foothold into emerging markets is time-sensitive, too.
Opportunities with new markets of this magnitude—that are influencing the purchasing decisions of much larger markets—come and go quickly…which begs the ultimate question: In this economy, is your company’s growth strategy reactionary or truly visionary?
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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.
People don’t stop eating during a recession. Instead, they adjust what they eat and where they have their meals. As a N.Y. branding and packaging agency that specializes in tracking trends in food purchasing preferences, it is quite visible to us here at Arcanna.
Home-based dining and food preparation is on an upswing, which can bode well for supermarkets and other food retailers. It also has encouraging implications for makers of specialty foods, as people look to substitute the dining variety they would get from eating at ethnic restaurants with experimenting with new foods at home.
When it comes to food preferences, the U.S. isn’t a melting pot and hasn’t been for years. Instead, it’s more like a salad bowl of diverse ethnicities, with ingredients that get tossed together but retain their individuality, influencing everything else.
The growing immigrant population has put new flavors and products on the map, from yellow rice to Wasabi Peas to San Marzano Tomatoes. The mainstream American population, already familiar with concepts like Tex-Mex and Pan-Asian, have been eager to try them, to the extent that ethnic and specialty foods now account for one out of every seven grocery dollars, and 73 percent of consumers reported purchasing specialty foods in 2007, compared to 64 percent in 2006.
Despite price hikes in retail foods, the grocery store is still less expensive than eating in a restaurant. Food marketers have helped to fuel the upswing in specialty food sales by getting recipes out via food magazines and on packaging, with ideas for using leftovers and how to increase serving sizes, as well as more creative ways to use packaged products with different seasonings and spices.
Even lower-end convenience stores are using specialty foods to entice more food purchases and bring more profits. C-store chains are catering to local palates, with items ranging from carnitas pita sandwiches to beef and green chili burritos and sugar cinnamon twist pastries.
The Piscataway, N.J.-based makers of Buenos Dias, a line of imported bakery products, recently adjusted its packaging and positioning to appeal to the Spanish market but found that a majority of its sales were from mainstream consumers seeking authentic Spanish products.
Foodtown, a Woodbridge, N.J.-based chain of supermarkets in New Jersey, New York and Long Island, has been increasing its sales in basic staple commodity items such as cheese, pasta, eggs, coffee and peanut butter, not only because of price increases but because consumers are cooking more at home – as much as a 35% increase in home cooking.
Private brand sales have increased and will continue to grow as consumers seek better cost value in their food purchase. “The trend toward organic, prepared and natural products has slowed as shoppers become more price sensitive,” said Foodtown Vice President of Center Stores Gus Lebiak.
As interest in and acceptance of ethnic foods by mainstream America will continue, we expect tough economic times will accelerate this trend.
Looking back at history we now realize that America's various ethnic groups have not evolved
into the great "melting pot" that we learned of as early as our grade school years.Instead of one unified culture, America is a rich mix of many cultural groups.
These market segments share a common bond through their set of
values — like freedom, equality and prosperity — but remain separated by
their diverse heritages.
Just as they have not assimilated, neither
have their brand preferences, with food representing a key way to honor
their history and maintain their cultural identities.
Watch our short video and see how the nation more aptly resembles a "salad bowl" of diverse cultural influences (or distinct
"ingredients") that complement one another without losing their core
flavors.
In fact, our different heritages not only make this country unique — they make America the lively, diverse and passionate nation that it is, with citizens forever open to new ideas, ways, styles and products. And we're a nation open to new trends and new tastes — as proven by the many cultural markets that not only influence the
trends and tastes of their own cultural groups, but of many other
groups, as well as mainstream audiences.
With a new set of influential "tastemakers" to
serve, marketers must do their homework so as to reap the potential
rewards. This is the foundation of what we call "Salad Bowl Branding." In this age it's the savviest, not necessarily the strongest, of specialty foods companies that will win… and in this age, daring to be different signals far less risk than remaining the same.
Covering these dynamic markets — and the unprecedented opportunities for today's marketers of specialty foods and beverages — is why we've launched this "Salad Bowl Branding" blog.
We look forward to sharing our opinions, getting your feedback, engaging in dialog and bringing you the most recent statistics, forecasts and developments in this ever-changing and always exciting industry.
Ready to move ahead with your business? Check out the Summer Fancy Food Show education programs for 2010.
An article from The Wall Street Journal (May 1st) titled 
