Specialty Food Magazine is the leading publication for retailers, manufacturers and foodservice professionals in the specialty food trade. It provides news, trends and business-building insights that help readers keep their businesses competitive.
Issue link: https://www.e-digitaleditions.com/i/986636
S14 STATE OF THE SPECIALTY FOOD INDUSTRY 2018 WHERE WILL SPECIALTY FOODS SELL IN THE FUTURE? MEAN % OF WEEKLY FOOD SPEND ON SPECIALTY FOODS 0% 10% 20% 30% 40% Quick Stop "We see the future growth of the [specialty] category being driven more by foodservice, convenience, and vending. We've seen a lot of growth in drug (CVS, Walgreens, etc.) as well. You've got all these differ- ent players now that want to carry some of these products." 27% 32% 2014 2015 2016 2018 37% 32% European chains Aldi and Lidl have expanded in the U.S. with great fanfare. This year, Mintel asked specialty food consumers about discounters like these, and more than 20 percent said they buy specialty foods in this channel, right behind online. Millennials shop for specialty foods in a variety of markets, particularly tertiary outlets such as discounters. iGens also spread out their purchases, casting a wide net as they learn where the best places are to buy these and other items. Both groups prefer the variety and possible savings associated with multi-outlet food shopping—opening the door for discounters with rock-bottom pricing on quality products. Convenience stores as well are drawing in consumers by augmenting the specialty variety in categories like snacks and beverages as well as fresh prepared foods. It's a channel with potential, according to members of the supply chain. "The big thing the industry is trying to figure out is how do you get the millennial mom who's out at the gas pump into the store," says a natural and specialty director for a large distributor. "It starts with offering, and once you get them in the store, it can't be outrageously priced for it to work. The convenience side of the business is starting to wake up to the fact that if they want that [consumer], they've got to have a compelling value proposition." DISCOUNTERS AND C-STORES *June 2014, July 2015, July 2016, January 2018 Source: Mintel For the third consecutive survey, SFCs report they're spending more than 30 percent of their total food dollars on specialty foods. Weekly spend has dipped to 2015 levels though, at 32 percent. There is a full 10-point difference in spending between light and heavy buyers, so marketing to the lighter to help them increase their spend creates opportunity. Among all respondents, spending on groceries is highest among millennials and boomers, while foodservice spending is highest among iGens. On average, foodservice spending is about 42 percent of the amount consumers spend on all food in a typical week, but iGens spend 51 percent. Interestingly, men over index on spending. So, they shop less frequently than females but spend more when they do. HOW MUCH ARE CONSUMERS SPENDING ON SPECIALTY FOOD?