Incremental changes in consumer behavior indicate a trend away from packaged and processed center store foods toward healthier and “free from” selections, according to a report from Fung Business Intelligence Centre.
“This is a very real trend [that will] continue to trickle down to mass-market consumers, and economic recovery is likely to strengthen [it],” Deborah Weinswig, executive director and head of global retail and technology for FBIC, New York, said in the report, entitled “The Middle-Aisles Exodus.”
“As a result [of the trend] we expect retailers across the spectrum to continue to ramp up choice and offer innovations that serve this demand, and we expect to see acquisitions among big-brand owners who have long been dependent on middle-aisle categories as they seek to tap growth elsewhere,” she noted.
The report cites a survey by Deloitte, released in January, indicating that 86% of the 4,000 consumers surveyed said they prefer “convenient options that are also healthy,” while 75% look for products with fewer ingredients, 74% pay attention to the nutritional content of foods they buy, and 72% avoid products with preservatives and other chemicals.
“Grocery shoppers are increasingly looking for products with as few added ingredients as possible,” Weinswig pointed out, “[which is] why the most popular attributes associated with healthy products all focus on the absence of processed and unhealthy ingredients.”
She said she expects all retail formats to continue to extend product ranges in fresh produce, organics, “free from” items and fresh categories such as dairy and bakery.
Weinswig also suggested opportunities for retail innovation, such as stripping candies and chocolates from checkout areas in favor of dried fruit, nuts, cereal bars, water and fruit juices; rebranding and repackaging existing products to drive consumer awareness, as Kroger has done with its Simple Truth line; and offering more fresh and natural options at small-store formats and convenience stores.

Regarding branded products, she said many consumers are skeptical that CPG reformulations “are compelling enough to help the brands gain share, while brand extensions and new product launches into fresh and natural categories by big, processed-food makers could fail to convince shoppers of their authenticity.”
Acquisitions offer the best opportunity for CPG giants to meet demand for healthier foods, Weinswig said, citing General Mills’ acquisition last year of Annie’s.
“Gluten-free items and organics look to be ripe for brand acquisitions and consolidation, as retailers’ private-labels have often been the drivers of innovation and product extensions,” she added.