The Future of Snacking shows you what snack food consumption will look like in the future, revealing your most promising opportunities for growth over the next five years. The report identifies potential risks and barriers to snacking, so you can understand threats and take advantage of positive trends.Learn More
Feeding the Growing Appetite for Restaurant Apps
Our new report, Delivering Digital Convenience, shows how consumers use and rate digital services from leading chains and third parties. It's a new resource to help you take advantage of the latest digital trends.Learn More Learn More
Our new U.S. Meal Kits Report integrates in-depth consumer survey information with expert insights from our team of experienced food and beverage consumption analysts. So whether you already offer meal kits, you’re looking to enter the category, or competing with meal kits, you can get the information you need for data-driven growth.Learn More
Despite What You’ve Read, Americans Are Cooking at Home
Recent headlines in major publications have led readers to believe Americans no longer cook and rely most heavily on restaurants for their meals. The issue with this premise is they’re mostly using one or two metrics that do not tell the entire story. At NPD we look at the complete picture of food and beverage consumption from all sources, which reveals the exact opposite scenario depicted in these articles.
The ratio of dollars spent on food in the home versus food away from home is almost evenly split, with a little more than half going to restaurants. This has led some writers to believe Americans are abandoning their kitchens in favor of the convenience restaurants provide. However, using only dollars to conduct your analyses tells only part of the story. Our CREST® data shows trips to restaurants have fallen since 2000 and are back to 1987 levels. This also explains why 82 percent of our meals are sourced from the home, which is up – not down – from a decade ago.
So how do we explain the apparent discrepancy between the increase in dollars but decrease in trips? Dollar sales are a function of prices and since an away-from-home meal typically costs around three times that of an in-home meal, it makes sense that restaurants take a disproportionate share of consumers’ food dollars. On top of that, prices at restaurants have on average increased faster than retail food prices over the last decade. This is why people are spending more dollars at restaurants while at the same time visiting them less often.
While U.S. consumers might not be dining out more, they do turn to foodservice for a shortcut in their in-home meal preparation. Close to half of dinners purchased from a restaurant are consumed at home, and a growing number of in-home meals are a blend of dishes prepared at home and items purchased ready-to-eat from a foodservice establishment. Our recently published Future of Dinner report forecasts blended meals, which include a restaurant or prepared food, will grow over the next five years.
In addition to foodservice, consumers’ in-home meal prep is also aided by the modern conveniences of grocery delivery, meal prep kits, grocerants (supermarkets that offer restaurant-quality foods), online ordering, and technology-enabled kitchen appliances and tools.Learn More
From consumer snacking habits to in-home meal prep, no other source tells you more about what Americans eat and drink . . . and how they think. Understand their perceptions of healthy eating, emerging developments, and the impact of e-commerce on purchasing behavior—so you can separate longstanding trends from flash-in-the-pan fads.Learn More
Make confident, data-driven decisions with thorough, fact-based forecasts on how aging, macro-trends, and population shifts will affect food consumption in the future.Read More Learn More
This report delves into the myriad choices and motivations at all day parts. See the motivations that drove each dining occasion and what’s truly behind our choices at all meal occasions.
Expansion into international markets offers large rewards but can come with substantial risks. Maximizing return by minimizing risk happens when the understanding of local behaviors and markets are used to create well-planned strategies. NPD’s study provides a view of consumption habits by capturing all foods and beverages consumed during a typical day both in and away from home.Learn More
Explore the rebirth of the value menu in our new Value Wars 2.0: The Value Menu Strikes Back Report. It assesses the effectiveness of the new value menus in the first full month these offers were available to consumers.Learn More Learn More
Mobile apps, self-serve kiosks, and third-party aggregators are driving visits and loyalty. Track consumer awareness and usage of these digital disruptors, and identify motivations and usage barriers.Learn More Learn More
Explore the consumer dynamics of parties with kids. Find out what really drives family restaurant visits, to support effective marketing strategies and menu development.Learn More Learn More
Understand how swings in bone-in wing pricing affects consumer purchasing behavior. Includes wing buyers’ food purchasing patterns, so you can make effective menu and pricing decisions.Learn More Learn More
Learn why specific types of consumers are dining out less often, to better position your business for growth. Don’t accept the status quo: make changes to migrate from survival to success.Learn More Learn More
Understand the emerging behavior patterns driving your business, to locate new market opportunities. See what foodservice consumers are doing right now, and what that means for your future growth.Read More Learn More
Inform innovation and targeting strategies by completing your view of U.S. eating habits with the fresh insights on how and what Hispanic consumers eat and drink both at home and away from home. The report gives you deep insight into the needs, behaviors, motivations, and desires of this growing population segment. Armed with this comprehensive report, you’ll find new ways to address the latest trends and strengthen your connection to Hispanic consumers, refine your targeting and messaging, and find new ways to appeal to this critical consumer group.Read More Learn More
For more than 20 years, we've asked American consumers to provide details about what they have in their kitchens and how they prepare and cook their meals. Get new insights from our report, Inside America's Kitchens, and learn how convenience and ready-to-eat food items are transforming the American kitchen.
Examine the restaurant segments, categories, visit situations, and specific food and beverage products that matter most to your business – now, and 10 years from now.Learn More
Focusing on delivery is one way to stay competitive in today’s slow-growth foodservice market. We know delivery trends were strong in 2017, but what is the outlook for the future? This report provides new insight about foodservice customers and the potential growth opportunity for delivery The Delivery Overview section looks across QSR pizza, QSR beyond pizza, and FSR, revealing unique business dynamics, consumer profiles, digital delivery engagement, and third-party apps. The Delivery Outlook section provides a five-year cohort forecast for restaurant delivery, as well as a two-year outlook for delivery compared across QSR pizza, QSR beyond pizza, and FSR.Read More Learn More
We find that personal value, more than brand loyalty, drives purchase behavior among Gen Zers. See what you need to do to meet this young generation’s needs when it comes to food.Learn More
Just like Taco Bell, which used Doritos as a taco shell, Burger King used what is called “Cheetos dust” to encase its handheld mac n’ cheese snack. The cheesy snacks are basically bite-sized, portable portions of the gooey dish. On the outside, the snacks look like oversized Cheetos; when you take a bite you find warm, gooey mac n’cheese on the inside.
This snack item was introduced in June 2016 to much fanfare and interest. It appears this limited-time offer (LTO) was successful the first time around, as Mac n’ Cheetos are back at Burger King for a cheesy Round Two.
Impact of limited-time offers
Limited-time offers can provide instant excitement about menu offerings. These offers are designed to be short-lived, and they can be effective tools for increasing brand awareness, driving traffic, and growing revenue for the restaurant operator. However, the ability to quantify an LTO’s impact on a chain’s business has been lacking until now.
Our Checkout TrackingSM service uncovered the business impact of Burger King’s Mac n’ Cheetos LTO in both Round One (June 2016) and Round Two (May 2017). We analyzed actual customer receipts to explore whether the Burger King Mac n’ Cheetos promotion spurred additional purchases by established customers or if it brought in new/lapsed customers. Did the offer lift the check size or items per order?
Mac n’ Cheetos lift check size and items per order
The impact the promotion had on Burger King’s business was particularly evident when looking at spend and order size among those who took advantage of the LTO in 2016. Burger King customers spent $5 more on occasions when they purchased Mac n’ Cheetos (which were priced around $2.55) and bought an average of 1.4 more items per order than customers who visited Burger King in the same period but didn’t purchase the LTO.
Additionally, Round 2 was even more successful in terms of the impact it had on the average check size when Mac n’ Cheetos was included in the transaction – 6 percent higher than it had been in the similar 2016 LTO.
Impact of Mac n’ Cheetos on Burger King’s Customer Base
This was thought to be a rather unique promotion and was somewhat surprising to learn that only 5 percent of Burger King customers took advantage of the Mac n’ Cheetos LTO in its first incarnation. Still, considering Burger King’s size, appealing to 5 percent of its customer base is not a small number in terms of actual number of buyers. And, like so many LTOs, it generated a lot of trial. A review of Mac n’ Cheetos 2016 purchase frequency reveals that the vast majority of Burger King customers who purchased the snack in Round One did so just once. And the share of new and lapsed customers who purchased the offer was lower than the share of non-LTO buyers, so the promotion did not bring new buyers into Burger King restaurants.
Findings from Mac n’ Cheetos Round Two
With our Checkout Tracking data we now have the capability to understand the underlying consumer behavior that drives the financial outcome associated with an LTO. As a result, we were able to conclude that Round Two was equally successful in generating increased sales for Burger King; the 2017 offer appealed to a similar number of Burger King buyers as Round One.Learn More
It’s widely known by now that Amazon.com acquired Whole Foods Market allowing Amazon further penetration into the fresh grocery world. Should we expect this to disrupt the grocery industry, or would a change even be noticed? Looking into the dynamics of online grocery shopping could yield answers.
One in five U.S. adults purchased a grocery item online in the past three months, shown by our Virtual Grocery Store report. The vast majority of them are repeat users, signaling high satisfaction scores. Consumers say the biggest reasons they use online grocers is because they don’t have to leave their home; it saves time. The top items they buy online are snack foods and beverages. Fresh items are among the bottom items purchased. This represents a barrier to usage: two-thirds of adults say they want to pick out their own fresh foods, which often sends them to a brick-and-mortar store for those items. Incidentally, online grocery shoppers say 76 percent of their dollars still go to brick-and-mortar stores so if Amazon wants growth in fresh food sales, its path needs to include an off-line component.
However, fresh food consumption is on the rise, which might have been part of Amazon’s desire to enter the fresh grocery business. Our National Eating Trends information shows all groups under age 40 consume more fresh foods compared to their cohorts 10 years ago, revealing a generational shift in behavior. It represents a departure from the decades-long growth of products that lowered time requirements in the kitchen for consumers, and as more consumers opt for fresh foods they naturally need to spend additional time preparing those items. Spending more time in the kitchen isn’t exactly a welcome thought among consumers who still allocate around 30 minutes to prepare their dinners.
There is a Path to Consumption® that includes food acquisition, preparation, cooking, and restocking. Each step on the path represents an area where consumers can save time to make up for the extra time involved with preparing fresh foods. Fresh meal kits are an example of how consumers are preparing more fresh foods while minimizing time spent elsewhere, such as in the grocery store or just determining what to make.
Amazon is famously known for efficiency in delivery and service. Whole Foods has a reputation for high quality foods, including fresh foods. Will Amazon bring its delivery and service methods to Whole Foods? It’s hard to say at this point, but both companies recently made investments to court the younger adults who use fresh foods in greater numbers. Amazon is testing a brick-and-mortar concept store called Amazon Go that has no check-out lines. Instead, the basket detects the items in it and automatically charges the customer’s account on the way out of the store, saving check-out line wait time – another example of cutting minutes along the Path to Consumption. Meanwhile, Whole Foods is opening a new banner called 365 by Whole Foods, which largely sells its private label products in an attempt to bring in younger, cost-conscious consumers.
Once Amazon has access to Whole Foods’ distribution centers it might be able to change the game when it comes to food delivery. As it stands now, roughly 43 percent of Americans or about 140 million people live in an area serviced by Amazon’s same-day delivery. These are mostly urban and suburban areas that have high overlap with Whole Foods’ service areas.Learn More
The U.S. restaurant industry’s stalled traffic is expected to continue through 2018. Understanding the foodservice-related habits of key generational groups is one way to address the complex issues that have created the current slow-to-no-growth environment. The NPD Group’s new report, What Matters Most To Key Generational Groups, explores key buyer groups’ wants and needs to reveal the factors that most influence their restaurant purchase behavior.Learn More
Bringing children into the world causes parents to make changes in their lifestyles – and Millennials are no different. The formation of families is one of the greatest causes of behavioral change in food and beverage consumption. As this generation continues to go through life stage changes they continue to exhibit changes worthy of attention.
When Millennials have children, their focus changes from themselves to the needs of their kids; this is reflected in their top motivations for choosing their breakfast foods. Our National Eating Trends shows satiation is the overriding motivation for Millennials who don’t have kids. They often say their breakfast choices are motivated by needs for energy, high protein content, and tiding them over to the next meal. Their counterparts with kids express higher demands for convenience, most likely related to the time they need to spend tending to the needs of their young children. Millennials with kids are more likely to choose breakfast foods that can be eaten quickly, that don’t require cooking, or are portable.
This means the foods Millennials choose differ slightly based on the presence of children. Millennials without kids take the time to make eggs or more complex items in the morning, but their counterparts with kids seek time-savers such as bars or yogurt.
Still, the want for healthy options during this time is universal regardless of how many children are in the home. Morning is motivated by a healthy/nutritious start to the day when consumers can eat foods that tide them over the next meal. Marketers can’t forget these important attributes and must include them in messaging to all Millennials.
At about 25 percent of the U.S. population, the Millennial generation is worthy of attention, but how you approach these consumers must be tactical. As many of them have started to form their families and undergo tremendous life stage and lifestyle changes, it’s important not to treat this generation as a monolithic group. Simply examining them by the presence of children alone reveals great differences in the ways they behave. Your product attributes and communications need to ensure they match the right needs with the right consumers.
Get more insights like this in our latest infographic.Learn More
We’ve all heard the age-old question, “What’s for dinner?” For many consumers, this question isn’t answered until right before dinnertime. This creates stress for some while others seem to solve for it by ensuring they keep a bountiful supply of ingredients available in their kitchens.
Among dinner planners, 80 percent say they finalize their dinner plans the day of the meal. As dinnertime approaches, the likelihood of opting to go out to eat or use carry out/delivery to solve for dinner increases. Our recent research on the Path to Consumption® for dinner shows that when dinner plans are finalized the day of the meal, 36 percent of the time planners opt to “shop their pantries,” or rely on items already on hand. On evenings like these, dinner planners are more likely to choose pasta, spaghetti, meat, and poultry for their entrees. In 2014, our Kitchen Audit study found 90 percent of households had dry pasta on hand and over 70 percent of households reported they had beef and/or chicken on hand, both of which can be “go to” items for building meals. Meanwhile frozen entrees are less likely to be used on these evenings.
Understanding the strategies and goals for what meal preparers decide to keep on hand is critical for developing strategies for winning a larger share of last minute “shop the pantry” meals. For example, while these are same-day decisions that rely on what’s on hand, nearly one in three meal preparers often say they turn to their pantries instead of ordering out because they enjoy cooking.
Family households can get more complicated for planners, who often grapple with different dinnertimes for family members or “shift eating.” This occurs at one in five dinners for households with kids. For about half of these situations it’s different meals for different people, and the meal preparer becomes something like a short-order cook. In these situations, consumers need solutions that are flexible without being more time-consuming for the meal preparer.
Since primary meal preparers traditionally have been women, many marketers still concentrate their messaging toward the head female in the home, but shifting demographics should encourage a more gender-neutral approach. While the dinner planner is slightly more likely to be an adult female, adult males report they are active in the process, either helping with the final decision-making or providing input. And with 40 percent of teens also reporting that they contribute to dinner plans, marketers should ensure their messages resonate with multiple family members and that all needs are being met.Learn More
Consumers express a multitude of needs at each eating occasion, but dinnertime is consistently stacked with the most. Our report, Consumption Drivers: How Needs Shape Choices, delves into the myriad choices and motivations at all day parts. It shows breakfast occasions are consolidated into the fewest needs; dinner must address the most consumer needs.
When you ask someone why they ate a particular food at a particular time, they often give you an answer that sounds like, “Because I was hungry!” However, when you ask them about multiple occasions, they have the ability to distinguish motivations that drove each occasion. Digging through these responses clarifies what’s truly behind our choices at all meal occasions. We call this a need state – the sum of all the influencers that drive an individual’s decision to consume a particular food or beverage.
At the highest level, four fundamental macro needs drive all consumption: Fueling, Wellness, Connecting, and Gratifying. Underneath each macro need we find the specific need states, which tell us the distinct benefits and behaviors reported by consumers.
Among the top needs expressed at dinner are speed, favorites, a break from the ordinary, and health. Satisfying these needs is crucial to winning consumers’ favor at dinner, which is helping to grow services such as meal kits. While meal kits might not save consumers time in the kitchen, they do save time in other areas along the path to consumption, such as grocery shopping. Meal kit recipes are often rooted in what we eat often, such as chicken and vegetable dinners, but they also offer different flavors or sauces to make them new. And many consumers today equate fresh with health so the mere fact that meal kit ingredients come fresh is satisfying a major need.
Of course, whom you ask also plays into how often and how heavily these needs are expressed. Younger consumers place a greater emphasis on the need for a break from the ordinary; they want to try new and bolder flavors. Meanwhile, older Boomers and seniors prefer to stick with what they know and often make foods they’re certain they will enjoy rather than attempting to be adventurous.
We’ve observed many changes in the foods and beverages consumers use and how they use them. Some categories that were dominant during meal occasions are now losing share to many smaller and growing categories. Consumers are also choosing to eat snack foods at main meals more often. Given all these changes, we need to take another look at the key drivers behind consumption decisions.Learn More
Using the Web to buy groceries may lag behind online purchasing in industries such as travel and small appliances, but online grocery customers in the U.S. report high levels of satisfaction and strong repeat rates. Many tell us they approach the whole task of shopping for food in a different way when they shop online – each purchase doesn’t have to be an “event” as it does with brick-and-mortar grocery shopping.
A few players have made the online grocery-shopping process easier and more compelling for consumers, through Website capabilities and delivery options, to try to grow the number of U.S. consumers who use an online grocer to deliver their foods and beverages. These efforts may be paying off – our report, The Virtual Grocery Store, shows 7 percent of adult consumers used such a site in a typical month, which roughly equates to 20 million users.
Much of the shift toward online for groceries comes from younger men who increasingly are responsible for grocery shopping. Men now represent more than 40 percent of those who are primarily responsible for acquiring the groceries in their homes. They consistently report grocery shopping as a chore and are more likely to have negative views of the experience compared to women.
As these shopping-averse consumers take on this role there is also evidence that consumers are more interested in the quick trip versus a shopping event to lessen their time in the stores at each trip. If this dynamic holds and grows, it could have a dramatic effect on grocery retail as it could signal a movement away from one-stop shopping. Those who use online grocers shop on average at six different channels compared to three channels for shoppers in general. An online consumer can, for example, use the Internet at work or at home to place a large order, make a quick trip to a grocery store on another day in case something was forgotten or out of stock in the large order, and then make a small trip to a c-store on the weekend. This pattern allows the consumer to limit the amount of time spent in the store during each trip.
Once consumers engage in online shopping there is a great likelihood they will return. More than 70 percent of those who ever tried online grocery shopping were active in recent months. High levels of satisfaction are making them repeat online shoppers. Nearly two-thirds of online grocery shoppers say they were completely satisfied with their last experience.
There is room to grow, however, since most consumers say they have never shopped for groceries online. One of the greatest barriers to converting these consumers is their desire to select their own fresh items; others say delivery fees aren’t worth the convenience.
Food and beverage manufacturers should monitor the quickly changing landscape with respect to grocery delivery services and online retailers to ensure their products are part of the assortment where it matters. Brick-and-mortar retailers also need to adjust to make sure they don’t lose out with younger, tech-savvy consumers. Now is the time to start developing and testing e-commerce programs or expand your current services. For both manufacturers and retailers acting now, while shoppers are experimenting and there is significant growth potential on the horizon, could help you keep up with changing shopping habits and stay ahead of competitors.
Humans are typically more comfortable with a concept the more familiar they are with it, but that doesn’t seem to be the case when it comes to genetically modified organisms (GMOs) in our foods. Our report, Navigating GMOs for Success, shows more people today compared to just three years ago are familiar with GMOs and why we use them, yet concern levels for consuming them continue to rise.
In 2013, 44 percent of primary grocery shoppers said GMOs have benefits, and most of the benefits they cited centered around more resilient crops and less pesticide use. At the same time, 70 percent said they had some kind of concern when it came to consuming genetically modified foods. Now more than half of primary grocery shoppers say there are benefits to GMOs, but as the number of those who are more familiar with the benefits grows, so does the number of people who are concerned, which now stands at 76 percent.
Source: The NPD Group/Custom GMO Survey 2016
Demand for non-GMO foods might be here to stay given the generational differences for awareness levels. There was a rise overall in awareness since 2013, but that mostly came from younger adults. That group of younger adults includes Millennials, who are telling us they have heard a great deal or quite a bit about GMOs. They are also the group growing most in terms of concern about consuming GMOs. Avoiding GMOs appears to be more of a generational shift than a passing fad.
Where people get their information about GMOs reflects the increasingly youthful face of those concerned. While TV has remained the most-cited source of information about GMOs since 2013, social media and the Internet are fast-growing sources, where information (regardless of its accuracy) can spread to millions of people in a short period of time. Marketers who choose to disclose the presence of GMOs in their products should harness social media to pre-empt negative reactions given the speed at which it can disseminate information before inaccurate information spreads.
Restaurants aren’t off the hook either when it comes to GMO concerns. When asked how concerned they are about ordering genetically modified foods and beverages when they go out to eat, about one third of older Millennials said they were concerned. By comparison, less than a quarter of all adults said the same. These concerns are clearly on the minds of many Millennials no matter where they source their food. GMOs will need to be addressed across the food consumption spectrum when catering to the needs of this generation.Learn More
Food and beverage consumption patterns are among the most stable consumer behaviors, but changes are happening that will alter, and even disrupt, what we consider to be the fundamentals for this industry. These trends are gathering steam. We will closely monitor them in the coming year and beyond.
Sweating the small stuff
It's the little things grabbing consumers’ attention these days; they can be small but influential ways to garner loyalty among consumers. Increasingly consumers are looking to support brands and companies that do more than manufacture a product —they want to support causes and actions aligned with their values. People feel they’re doing right when they support companies that are connected to locally sourced ingredients, donations to charities, sustainable environmental practices, and animal welfare practices. The constant flow of Internet-based information will continue growing, so expect younger consumers especially to research brands and pinpoint those with the qualities they value.
Healthful eating gets personal
It’s not about what works on average but what works for the individual. Just as consumers want personal touches in the foods they eat, health is getting personal as well. Wearable devices that track footsteps and apps that track calories allow consumers to develop their own personal plans to meet their needs, rather than relying on health plans based on averages. Even though dieting is on the decline, “my own diet” is still rising as the most common way consumers take control of their intake. They’re looking for personal plans that meet their own specific interests, and more importantly, their lifestyles.
The future is now
Technology is quickly making its way into how we acquire our foods and beverages. It represents a small portion of food acquisition but has the potential to grow if consumers are convinced the extra cost of technology saves time in other areas of their lives. Technology is also helping consumers avoid the grocery store entirely by enabling them to purchase their groceries online and have them delivered to their homes. Based on growth patterns for this behavior we expect to see more people in the coming years use retailers’ websites or third-party sites like InstaCart to acquire foods and beverages.
Meal kits, still in their infancy, are another time-saver and solve the age-old problem of figuring out what to have for dinner. The kits also prevent fresh foods from spoiling by providing the exact amount of ingredients called for by a particular recipe.
Home is where the meal is
It’s becoming more common to make meals at home while also using dishes sourced from restaurants. Those purchased components are more likely to be appetizers or side dishes, indicating consumers use these dishes as quick ways to round out or complete their meals. It’s yet another sign people want freshly prepared items in the home without having to spend a great deal of time in the kitchen. This is a true generational shift; younger consumers already consume fresh foods at rates higher than older adults did when they were the same age. As these younger consumers age, our forecast shows their demand for freshness in a hurry will only increase.
The NPD Group is constantly monitoring these trends and so should you. These are exciting times in the food and beverage industry as there many changes occurring at rates we haven’t seen in quite a while. Don’t risk falling behind your competition and plan now for these shifts before they get bigger.Learn More
It's a "one-percent world," where growth is largely absent across foodservice segments. And now we're even seeing a slowdown in a former bright spot: quick service restaurants. But rather than simply accepting the status quo, smart companies are looking more deeply into what's actually behind the slow-to-no-growth problem. They want to identify their best opportunities to not just survive, but thrive. That's where The NPD Group's Losing Our Appetite for Restaurants report comes in.Learn More
Eating habits are evolving in the U.S., and that includes blurring of the lines between traditional meal components and snack food items to create simpler meals. This has many food manufacturers struggling to find ways to jump-start growth. Winning share of stomach requires a deep understanding of what’s happening at home and at foodservice, so you remain in consumers’ line of sight as they make consumption choices.
Source: The NPD Group/National Eating Trends® (NET®), two years ending Feb. 2016
While more than 80 percent of our meals are sourced from the home, not all food categories follow that same proportion. In fact, several categories are almost exclusively consumed away from home. Hamburgers, for example, are consumed at restaurants nearly three-quarters of the time, yet fruit is consumed in the home 95 percent of the time.
That might be where these categories stand today, but marketers should be aware of gradual shifts over time. For example, sandwiches have started to shift back toward the home. In 2006, 55 percent of sandwiches were consumed in the home, but as of 2016, that has risen to nearly 60 percent. Given how important sandwiches are at lunch and dinner, this can have great implications on surrounding categories such as cold cuts, peanut butter, jelly, breads, and condiments. We’re seeing a similar shift in carbonated soft drinks, which are seeing a decline in consumption from restaurants, but the change for in-home consumption has been flat.
Changing demographics are playing a role in the shifts in consumption locations. Millennials have been a key driver of the movement toward home-prepared meals ever since the recession of 2008 gripped us. Millennials were the first to pull back from restaurants, but even as the economy improved they continued to prepare more meals at home than previous generations did at the same age, signaling a generational shift.
Understanding the dynamics behind each category is essential, because the motivations driving consumption at home versus away can vary greatly. Marketers should rethink the roles certain items play in eating occasions, in order to keep pace with some of these faster-moving shifts influenced by generational and multicultural attitudes.Learn More
According to the U.S. Census, 13.4 million people in 2010 worked at least one day at home per week, an increase of more than 4 million people (35 percent) over the course of a decade. At the same time, our National Eating Trends® (NET®) data shows more lunches are being sourced from and consumed in the home.
The average number of lunches per capita prepared and eaten in the home grew from 139 in 2006 to 156 in 2016. In the same time period, the number of carried-from-home lunches declined from 46 to 42. With the home becoming the workplace for a growing number of American workers, we’re seeing a related shift at foodservice: a reduced need for restaurants in people’s daily lives.
Since food consumption is often a zero-sum game, meaning a growing behavior in one area is often at the expense of another, certain segments of restaurants are seeing a corresponding decline in traffic. Overall foodservice traffic is down 4 percent at lunchtime in the latest quarter ending June 2016 versus the same quarter year ago. This decline is driven mostly by casual dining and fast casual (a quick service category) restaurants where traffic was down in the quarter ending June compared to same quarter last year, by 6 percent and 9 respectively.
As more consumers are choosing to prepare and consume their lunches in the home we’re also observing changes in what makes it on the plate. While sandwiches are still the top item consumed at this midday meal the type of sandwich is experiencing slow but steady shifts. For example, while peanut butter and jelly and ham sandwiches are the most commonly consumed sandwiches, their share has dipped; cheese and other cold cuts have taken share. There are also shifting preferences for the breads that surround the sandwich filling. White bread has been used less often, and in its place we’ve seen more whole wheat bread, tortillas, and buns/rolls.
For marketers involved with lunchtime products, make sure you’re moving with the consumers who are working from home. Just because more consumers are using their homes as their offices, it doesn’t mean they’re spending more time in the kitchen to make lunch. Lunches are still motivated by speed and simplicity since these people need to get back to work just like anyone in a traditional workplace.
Disruptors happen in all industries, causing shifts in the way consumers use or access products. These disruptors force marketers to adjust their ways of doing business to ensure they remain relevant with consumers’ needs. Food and beverage works this way as well – and there is evidence that new disruptors are on their way.
Before discussing any detail behind disruptors in food and beverage it’s important to understand the pace at which these changes are likely to move. Our consumption behaviors are deeply rooted in culture and are very habitual. Historically these behaviors change at a very slow pace compared to, for example, behaviors in the technology industry. The phones we carry in our pockets today probably look very different from those five years ago and include far more functions, but by comparison, what we have eaten over that same period of time probably looks similar. Disruptors in food and beverage may take 10 to 20 years to take their full grip, but it’s important to plan for them before you have to start playing a game of catch-up.
The grocerant is a good example of a disruptor we see unfolding. As the name implies, it’s a grocery store-restaurant hybrid that provides restaurant-quality, fresh-prepared foods, with in-store enjoyment options from café seating to table service. Our research shows these store formats are competing most closely with fast casual restaurants based on motivations for visiting the establishment. For both sectors, price, quality and variety of the food, and the ability to get a healthy meal drive consumers to dine there. And while both fast casual restaurants and grocerants attract Millennials, the grocerant provides its services at lower prices, helping these cost-conscious consumers dine within their budgets.
Fresh foods are a key component of grocerant offerings, and the desire for fresh carries into the home as well. The problem consumers have is that fresh doesn’t stay fresh if it lingers too long. And since many fresh items have to be purchased in larger sizes, a decent amount may spoil before all of it can be consumed. With food waste in mind, many consumers have begun experimenting with fresh meal delivery kits, which provide just the right amount of fresh food and effortlessly answer the question, “What’s for dinner?”
There are other disruptors on the horizon, and in each case there is a common theme – the disruptor saves the consumer time or money, or both. In the grocerant case, consumers save time by being able to remain in the store to get a fresh meal after shopping is done, and the prices save them money compared to other outlets. Meal delivery kits save consumers time by eliminating trips to the grocery store and by cutting out the need to research recipe ideas. Both of these concepts represent a small part of their respective segments – grocerants account for about 4 percent of the QSR retail sector, while 3 percent of individuals in the U.S. tried a meal delivery kit last year.
There’s great growth potential. It won’t happen from just one year to the next, and we need only look to history as evidence of this pace. Consider the microwave oven, which is now a fixture in about 90 percent of U.S. households. It began its residential use around the late 1970s, when advances in technology allowed for lower price tags. Despite that, it still took the better part of a decade for a majority of homes to have one. Given the way the microwave oven saves time with cooking and the vast amount of products that were developed as a result of its invention, it was clearly a disruptor. Those who prepared in the early 1980s for its expansion reaped the benefits of their preparedness.
Marketers would be wise to find ways to associate their products with current and emerging disruptors. For example, getting your products inside the fresh meal delivery kit shows consumers new ways to use your products. And while the consumer is in the grocery store, make your products available at the grocerant as either the main feature or the side component.Learn More
The United States Congress voted to set a national standard for labeling the presence of genetically modified organisms (GMOs) in food and beverage products. The language of the bill, however, allows manufacturers to disclose this information using scan codes, providing a chance to talk about more than just GMOs.
Vermont has a GMO labeling law that recently took effect. It caused a stir in the industry, creating calls for a national standard. The federal bill, which would supersede Vermont’s regulations should it become law, appears to be the result of compromise – on one hand, it would require manufacturers to make their GMO content information available to consumers, but on the other hand, they wouldn’t be required to do that on product packaging. Consumers would scan a special code on a package with a smartphone and be taken to a website showing the GMO content for that product.
GMOs have become an interesting topic in the food industry since most consumers know very little about the issue. Our report on the topic, Gauging GMO Awareness and Impact, revealed more than half of U.S. consumers say they know little to nothing about GMOs, yet at the same time about 70 percent have concerns about GMOs in food products. While consumers aren’t sure precisely what happens when a food is genetically altered, it’s clear that just mentioning “GMO” or “genetically modified” conjures thoughts of danger; many consumers think twice about using a product that might include genetically modified ingredients.
Should this bill become law in its current form, marketers might be able to talk about more than just GMOs when consumers scan the code. This could be an opportunity to talk about why GMO products were used to help calm consumers’ fears. For example, our report noted that among those who say GMOs have benefits, most talked about stronger and more disease-resistant crops.
The conversation could go beyond GMOs as well. While consumers are on your site talking about GMOs, you might also mention other health benefits of your products to help balance the GMO concerns. For instance, while a product might contain GMOs, it’s could also be a good source of protein, or perhaps your plant uses sustainable energy sources.
The key to winning with consumers on GMOs is communication. Being open and honest with consumers will go a long way in proving that what they see is what they get and you’re not trying to hide anything. In fact, a greater number of primary grocery shoppers are telling us they want labels to state if the items contains genetically modified organisms than those who want GMOs removed altogether from products.Learn More
Meal kit delivery services like Blue Apron and Plated have garnered a small, but seemingly dedicated, segment of enthusiasts in the U.S. Are these kits a passing fad, or is this a trend worth watching? Our new report, Thinking Inside the Box: A Fresh Look at Meal Kit Delivery Services, combines findings of our own custom study with ongoing NET® consumer tracking research, insights from our Checkout Tracking solution, and industry expertise. It uncovers answers to your pressing questions about this new player in your market.Learn More
Meal kit delivery services are a growing sector in the food industry. They’re helping consumers satisfy the need for fresh foods without spending time gathering the food, but should grocers or restaurants be more fearful of the potential impact on their business?
On a per-person basis, food consumption is a zero-sum game, meaning an increase in one behavior is often at the expense of another. For example, we’ve mentioned over the last decade more consumers are having eggs, yogurt, bars, and a few other foods more often at breakfast, but these increases are largely coming at the expense of cold cereal consumption.
Our new report, Thinking Inside the Box: A Fresh Look at Meal Kit Delivery Services, sheds new light on the growth dynamics of these services as well as several of the potential pitfalls these fledgling businesses could face. Among them is the finding that two-thirds of meal kit users say the meal they prepared from the box replaced a home-cooked meal; less than 25 percent say it replaced a restaurant meal.
It seems the most direct competitor to the meal kit is the grocery store, on the surface at least, since that would have been the source of the meal that otherwise would have been prepared. The question is whether or not meal kit users see the value in replacing their home meals with a more expensive meal where everything is premeasured and delivered to their doors. On average, the cost of an in-home dinner where the consumer sources the food from a grocer is about $4 per person. Meal kits are about $10 per person for the same meal. For those who live in a high cost of living market such as New York or San Francisco, $10 per person for dinner might sound like a bargain, but elsewhere it represents a higher cost in need of justification
Companies such as Blue Apron and Hello Fresh will have to convince consumers that the extra spend at dinnertime is outweighed by the time saved at the grocery store and the time spent searching for recipes. In the meantime, manufacturers should consider how they can get “in the box.” This would be a new way to show consumers additional ways to use your products as they prepare meals. For restaurants, take advantage of your flexibility – allow customers to order on demand and aim to satisfy everyone's personal tastes with different meals. To avoid lost trips, retailers can leverage prepared food sections and further the Grocerant concept by providing fresh food customized to consumers’ tastes.Learn More
Find out how the food and beverage consumption of key generations – Gen Z, Millennials, and Boomers – is set to change as these groups move through life stages. Our new report, A Generational Study: The Evolution of Eating, reveals whether their patterns will be similar to, or different from, those of previous generations. It’s how to develop marketing strategies and make long-range plans that position your business for growth.Learn More
Beverages have shown waning popularity over the past several years, with sales declining by 4 percent since 2010. The industry expected an improving economy would bump up beverage orders. In fact, it seems consumers’ thirst for beverages at foodservice is not bouncing back. How can you give beverages a boost? Our new Satisfying Our Thirst for Beverages Report evaluates consumers’ beverage choices to determine why they order one beverage over another, what’s behind outlet choices when it comes to beverages, how beverage variety factors into their decisions, and more.Learn More
Now you can determine whether targeting clean eaters is the right move for your business. Our new report, How Consumers Define Clean Eating, sizes the clean eating market, profiles the consumers engaged in clean eating, and reveals how primary grocery shoppers shop for foods that fit into this emerging lifestyle. You can use the report’s deep data and expert insights to understand consumer awareness of this trend and consumers’ ideas of what clean eating means.Learn More
There was a time when snacking occasions were considered times in the day when we consumed extraneous calories for the sake of treating or rewarding ourselves. As we’ve seen throughout food and beverage consumptions trends, however, this perception slowly changed over the last two decades and is expected to continue evolvingLearn More