Insights

Global consumers seek affordable nutrition post pandemic

Mintel takes a look at the importance of affordable dairy nutrition to consumers as costs rise

16 Dec 2022

6 min

#Consumer Powders #Global #Insights

 

Global inflation is projected to reach 8.8% in 20221.

 

While the rising food & drink costs is a key area of concern, with 80% of Thai consumers2 expecting increases in food & drink prices, consumers are more likely to cut down on non-essential expenses such as eating out, leisure and clothing3. Food & drink for at home consumption is more resilient to the cost of living crisis and consumers are more inclined to look for savings than cutting back. The main saving strategies4 consumers in countries impacted by inflation are doing is stocking up during sales, reducing treats such as gourmet coffee, switching to stores with cheaper prices and buying more private label brands. For instance,

52%

of consumers in Nigeria5 are trying to save money on food & drink by taking advantage of sales to stock up.

 

 

 

In addition to looking for savings, consumers are concerned about eating healthy6, especially since the pandemic. In Nigeria, 63% of consumers7 say that they plan to consume more nutritious food/drink (eg products packed with vitamins and minerals) over the next 12 months. Milk is a nutritious staple in many households and can be positioned as a smart choice for challenging times. In Thailand, 63% of consumers8 view cow’s milk as nutritious and,

49%

of milk consumers9 in Brazil, agree it is important for kids to drink cow's milk.

 

 

 

In addition to bulk-buying, consumers will be motivated to cook more at home due to inflation. In Nigeria, 47% of consumers10 intend to cook from scratch more often. For dairy, there will be opportunities from consumers having more breakfast at home. Despite a need to save money, consumers still associate value with more than just low prices11. Beyond proving value with health benefits, consumers will see value in versatility and the various types of occasions they can use a particular shelf-stable product. Milk powder brands are in a great position to cater to consumers’ desire to make the most of what they buy and prevent food waste by promoting the use of their products in coffee and tea, cooking, baking, making yogurt and desserts, as well as a quick and nutritious snack at any time of day. As a result of the pandemic,

53%

of South African consumers12 say they will plan meals ahead to make use of all ingredients and avoid waste.

 

 

 

Consumers struggling financially and unable to stock up on products will benefit from more affordable and smaller pack sizes such as single serve sachets. In SEA, there has been a significant growth in powdered milk with pack sizes smaller than 500g13 in the past 3 years. With regard to budget-tight consumers, particularly women and children who are at greater risk of malnutrition, dairy companies have a duty to deliver affordable nutrition14. Consumers expect brands to take action against societal issues. Inequality in society is one of them, and ensuring equality includes access to affordable, healthy food and drink.

Consumers who are concerned about food poverty will look for food and drink companies that work to reduce food insecurity. However, consumers are more likely to think that a food or drink product is good value for money15 if it has health benefits rather than if it is made by an ethical/socially responsible brand. Therefore, brands taking action against food poverty should not make their initiatives an on-pack marketing argument. Instead, they should communicate off pack. Environmental claims (e.g. supporting natural conservation) and animal/workers/farmers welfare tend to resonate more with consumers16 than ethical claims (e.g. supporting social equality). 

 

Young SEA girl close up drinking milk sat with family around kitchen table

 

Top attributes sought after17 when shopping for food include contributing to fruit/vegetable intake, natural ingredients, source of vitamins/minerals, low fat and low sugar content. Brands can increase appeal by linking nutrients to the top health benefits18 consumers are looking for, including immunity support, heart health, gut health, healthy weight and brain function. Multiple benefits can be a winning mix for food & drink, so long as the products are affordable. Brands can take inspiration from yoghurt's positioning as a budget food with multiple health benefits. In Thailand, 82% of yoghurt consumers19 agree it is important to consume yoghurt every day to maintain good health, and

89%

have increased their consumption over the past year.

 

 

 

Young SEA Mother pouring a spoon of milk powder into a glass of water at the breakfast table

Consumers are taking a cautious approach to rising inflation, and are looking to brands to take a lead with providing solutions. Three things brand owners can do to align with consumers’ needs and expectations are: deliver affordable nutrition supporting overall health; demonstrate how affordable nutrition is helping to reduce food insecurity among societies’ most vulnerable; and add value with versatility so consumers can avoid food waste making the most of what they buy.

 

In the context of inflation, affordable dairy options can and will put consumers' minds at ease. Consumers will be drawn to dairy products that are positioned as all-in-one nutritious and affordable solutions. Dairy products contain several macro- and micro-nutrients that are essential and can help close consumers' "nutritional gaps".

Beyond low retail price, which can be perceived as low quality, dairy consumers will assess the 'true value' of products. Benefits such as nutrition (including nutrient density), versatility, functionality and taste will help consumers feel they make a smart choice rather than being forced to compromise on quality.

Moreover, consumers expect brands to take action against societal issues. Food insecurity is one of them. Consumers will look for dairy brands that work to improve nutrition equity by delivering affordable nutrition to consumers who live in budget-tight households and critically need the nutrients available in dairy.

Inflation can also be an opportunity to regain some consumers that have shifted part of their dairy consumption to non-dairy in the US and Europe. If non-dairy milk becomes too expensive, 54% US consumers20 claim they would switch to dairy. Dairy milk significantly outpaces all non-dairy base types’ nutrition perceptions among US21 and UK22 consumers.

Caroline Roux

Consultant Analyst, Mintel

 

Click here to learn more about NZMP's affordable and nutrionally fortified dairy-based powder, NutriWhite.

 

 

Expert

Adriana Heinzen

Associate Director of Consulting, Mintel

Adriana has over ten years of experience in marketing across agency and client-side, most recently leading product innovation, brand health tracking and advertising research in food & beverages, VMS, media, and transport services. Prior to that, she worked on shopper marketing projects for leading FMCG companies. Adriana is a qualified professional researcher with the Australian Research Society and has a Master of Marketing degree from the University of Sydney.

Caroline Roux

Consultant Analyst, Mintel

In her current role at Mintel, Caroline Roux provides robust consumer insights and realistic recommendations to food and drink companies around the globe, particularly dairy ones. Her forward-thinking analysis focuses on specific issues and broader macro-trends impacting consumer behaviour, companies’ strategy, innovation, and brand development. Prior to Mintel, Caroline worked in marketing on leading French and British dairy brands. She led annual brand planning, developed marketing plans and drove innovation projects. Beyond her marketing expertise, Caroline has experience in working with manufacturers' cross-functional teams as well as with food and drink retailers. Caroline has a Master’s Degree in Sociology from La Sorbonne University (France) and a MA in Marketing from Dauphine University (France).

The views expressed above are the opinion of the author, not those of Fonterra, and Fonterra is not responsible for any decisions taken in reliance on the same.

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