You are what you buy
Canadians want to buy foods that are healthier. But that doesn’t mean they’ll always pay more for them
People eat differently around the world, but one thing many of us have in common is a desire to lose weight.
Call it the battle of the bulge; nearly half (49%) of respondents in Nielsen’s Global Health and Wellness Survey consider themselves overweight. In Canada, that figure is even higher: 59% believe they’re over- weight. Furthermore, 52% of Canadians are trying to lose weight and 62% are willing to pay more for foods that come with healthy attributes.
These numbers point to a big opportunity for food retailers and manufacturers to lead a healthy eating movement by providing better-for-you products. Diet fads come and go, but innovative, back-to-basics foods that taste good, are easy to prepare and provide healthful benefits have staying power.
The first step to higher healthy food sales is understanding what drives buying decisions.
One area to consider (from a grocer’s and foodmaker’s standpoint) is whether Canadians are willing to pay more for foods with a healthy benefit. The answer, according to our survey, is yes–to a degree.
An average of 31% respondents are only slightly willing to pay a premium for health claims across 27 food attributes we measured, such as low sodium or high fibre. Overall, approximately one-quarter are moderately willing to pay a premium (28%), followed by 13% who are very willing and 28% who are not willing at all.
Not surprisingly, there’s a gap between the percentage of Canadians who say a health attribute is very important to them and the number very willing to pay a premium for such a product. For example, 30% of respondents say the absence of GMOs is very important in the foods they purchase, but only 18% are very willing to pay a premium for non-GMO products. That’s a 12-percentage-point difference.
On the other hand, 17% of consumers say organics are very important, and a tad more than that (18%) say they are also very willing to pay a premium for these products. So if your selection of organics leaves too much room to the imagination, chances are you are putting money in your competitor’s till.
Overall, Canadians believe it is worth paying a premium for grocery products with all-natural, high-fibre and organic claims. As you might expect, age plays a big factor in deciding who pays more for a product with a health benefit. Our survey found that, for the most part, younger consumers are most willing to back up their sentiments with their wallets. Half of consumers 35 or younger say they are moderately or very willing to pay a premium for all 27 of the health attributes examined in our survey, versus 34% amongst those 55 or older.
The generation gap particularly stands out on functional foods that reduce disease risk or promote good health, and for socially and environmentally responsible foods (perhaps not a metric of personal health, but certainly related). For example, 53% of respondents 35 or younger are moderately or very willing to pay extra for sustainably sourced ingredients, compared to 27% of consumers 55 or older. As millennials’ purchasing power increases, grocers who make a genuine effort to understand this generation will likely increase their odds of success.
With 85% of Canadians believing they “are what they eat,” and three-quarters actively using foods for the betterment of health issues and medical conditions, the obesity crisis and consumers’ desire to become healthier is a platform for growth for grocers, who can fine tune their on-shelf offerings to consumers’ needs to flip the health switch.
We all crave more education and transparency about health and wellness claims. What a great opportunity to build up consumer trust.