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The Future of Food Labeling: Winning Trust and Maximizing In-Store Appeal

Datamonitor
October 29, 2008
265 Pages - SKU: DFMN2012763

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Introduction

More than half (57%) of consumers across the globe are interested in food label information. This highlights how food labeling is a vital issue as consumers seek to improve their knowledge about nutritional and ethical issues and how they relate to their grocery choices. Labels more than ever provide a vital informational bridge between producers and consumers at time of purchase.

Scope

Examines the increasingly expansive role of labels in directing shopper choices including nutrition, origin, ethics and convenience
Understand how much emphasis shoppers place on micro and macronutrients when making product selections and how labels guide this
Global coverage: proprietary consumer survey data from 15 countries across five continents covering a host of highly pertinent food labeling issues
Detailed recommendations and interpretation offering practical strategies based on the trends and insights uncovered in the report

Highlights

An increasingly strong appetite for label information has emerged as consumers become more concerned with their health and a myriad of other product details. Industry players need to capitalize on this interest to regain consumer trust. It also highlights the ongoing significance of label information as a marketing tool

In the emerging (yet already significant) economic powerhouses of the BRIC grouping (which includes India and China from Asia Pacific plus Brazil and Russia), 54% more consumers have used food labels more often in 2008 compared with those who have used them less

Consumers from countries outside the BRIC grouping find it is not easy to tell if a food product is healthy from its label. Less than half of consumers in any country (Brazil highest with 42%) find they can readily deem a food product healthy when shopping. In Australia, this prevalence is less than 30%

Reasons to Purchase

Trend understanding: identify global consumers' interest in, and usage of, food label information and how this is changing over time
Actionable insight: understand what factors are driving brand choice and how this can be addressed with on-pack labels
Ideation and inspiration: spark new ideas by learning from innovative 'on-trend' products and marketing campaigns in the FMCG industry

Overview: Catalyst; Summary; Table of Contents; Table of figures; Table of tables
THE FUTURE DECODED: INTRODUCTION: Labeling is a vital element of food products for many reasons; Labeling is vital to inform consumers when making their food and beverage choices; TREND: Interest in food labels is high across the globe; Emerging market consumers tend to give positive consumer survey responses due to prevailing cultural norms; More consumers appear to be turning their interest in food labeling into regular behavior; Regional variations in food label usage are apparent with greatest interest in Asia Pacific; Key takeouts and implications: consumers are highly interested in food labels which emphasizes the role labels and packaging has in influencing in-store choices; INSIGHT: Situational factors influence propensity to examine nutritional content; Lack of product familiarity is linked with increased label reliance; For around a quarter of time poor 'speed shoppers' reading food labels is not necessarily appealing; Time-starved consumers often focus on only key things when reading a food label; Product attributes also govern the relationship shoppers have with label information; Key takeouts and implications: broader purchasing influences and product category and attributes shape consumers' label usage; INSIGHT: Gender differences exist in food labeling interest and usage; Women are intuitively more interested in diet and nutrition than men; Women are more interested in food labels than men; Other socio demographic insights apply to label interest and usage; Key takeouts and implications: women are more interested in label information than men but the gender gap is not that pronounced; INSIGHT: Much of the recent interest and concern about labeling centers on health issues; Many consumers are demonstrating high levels of concern about their dietary choices; Packaging/labeling has become a fundamental facilitator of health information, and strongly influences food and beverage purchase decisions; The more conscious shoppers are about health, the more interest they have in health related label information; Consumers are drawn to the health information on labels that they have the most interest in; Food safety information is an important and perhaps overlooked component of health related information on labels; Food label information is a potentially important tool to restore consumer trust when it comes to health claims and overall product integrity; Key takeouts and implications: attitudes towards health significantly influence interest and usage of food label information; INSIGHT: User-friendliness and improving user understanding is a key issue for labeling; Consumers express only relative confidence in their ability to use and understand food label information; Consumers are often likely to over-report their understanding of food labels and nutritional information; Consumers lack confidence in using food labeling to determine if the overall product is healthy; Consumers find the variety of label systems confusing; Traffic light systems have become commonplace due to government insistence but are not yet universal; The EU prefers the RDA labeling system; Consumers may want a common system but brands and retailers are reluctant; Consumers are disappointed with overly vague labels; Consumers like the idea of simplified front-of-pack information but are also critical and wary of overly simplistic information; Font sizes may become too small for many consumers as the Seniors population rises; People with eyesight problems may struggle with the small print on labels; Key takeouts and implications: food labels often lack user-friendliness, which prevents labels from directing consumer choice in a fully efficient and effective manner; INSIGHT: Organic and ethical labels are better regulated and enjoy greater consumer confidence; Organic is best regulated but some organic consumers are still confused and mistrusting of product claims; Ethical/fairtrade products are now established grocery purchases but have many different labels; Choice editing by supermarkets makes the consumer choice easier by removing choice; Key takeouts and implications: strictly regulated organic and ethical labels gives them added credence; INSIGHT: Consumers have mixed feelings about 'unregulated' food label terms; Non-regulated terms are confusing but consumers look for both tangible and subjective terms; Consumers are most confused about non-legally defined terms such as 'traditional'; Descriptor label terms have significant appeal for consumers; Consumers want labels that help them avoid being misinformed; Key takeouts and implications: subjective terms elicit confusion, skepticism and positive perceptions in equal measure; INSIGHT: Country Of Origin Labels (COOL) are popular with consumers for many reasons; Consumers place considerable importance on knowing the origin of products; Origin also impacts perceived purchase intentions especially in Asia; 'Locavorism' is less important in emerging economies; COOL is welcomed by patriotic consumers who perceive higher levels of quality and safety; Certain products are more credible if from a specific country; COOL labeling is subject to loophole abuse; Key takeouts and implications: provenance labels on food are popular for many reasons; INSIGHT: The desire for more information conflicts with the desire for less packaging and risks shifting the message away from pleasure and enjoyment; There are several contradictions in the food and drink industries that relate to labeling and packaging. Firstly, concern for the environment means that many consumers and ecological pressure groups would like to see the amount of packaging used for grocery items to be continually decreased until all products have the bare minimum needed to safely transport them to the market place and to safely store them until consumer usage. This means that the surface area available for labeling information would similarly have to decrease. Already the effects of this can be seen on certain packaged meat products where the suggested optimal cooking instructions are printed on the reverse of the exterior label so that they are hidden from view for as long as the cellophane wrapper remains in tact. This can potentially limit the desire of consumers to experiment with new cuts of meat.; Consumers have an increasing desire to reduce waste and minimize their packaging footprints; Brands face the dilemma of how to provide sufficient information and more; Too much label information can also detract from messages of enjoyment and indulgence; Key takeouts and implications: balancing complete information with less packaging is problematic as is not letting the label exacerbate feelings of negativity about eating; INSIGHT: A number of labeling initiatives and proposals exist across the globe; Country-specific origin labels exist such a Red tractor (UK) and Red label (France); Freedom Foods are those which are produced where any animal-derived component is farmed in humane conditions; Package labels detailing carbon footprints are beginning to emerge; Quota based label encouraging both moderation and inclusion are common; Organic labels vary depending on country and certification; Ethical and fairtrade labels also vary nationally; Vegetarian choices are aided by the vegetarian society label; Key takeouts and implications: many labels exist around the world that could act as quality benchmarks
ACTION POINTS: ACTION: Increase consumer convenience for understanding labels; Make instructions as graphical as possible to add convenience; Facilitate the reading of labels with clear branding, use of color and linguistic simplicity; ACTION: Use clear labeling to support consumers dietary goals; Use consistent front of pack labeling to help consumers make good choices; Help consumers to check their nutritional balance with quota based labels; Support dieting and health-conscious consumers with calorie controlled portions; ACTION: Incorporate sensory appeal into food and drink labels; Follow the example of existing multi-sensory labeling; ACTION: Leverage technology to solve the conflicting demands of increased information and decreased packaging; Use online, off-package labeling to better inform consumers; ACTION: Use package information to reassure consumers and tell the product story
APPENDIX: Definitions; Methodology; Further reading and references; Ask the analyst; Datamonitor consulting; Disclaimer
List of Tables: Table 1: Consumer Survey: level of consumer interest in food label information, in 15 countries across Europe, Asia Pacific, South America and the US, by country, 2008; Table 2: Consumer survey: change in frequency of using nutritional information in the last six months, in 15 countries across Europe, Asia Pacific, South America and the US, by country, 2008; Table 3: Consumer survey: the extent to which European and US consumers used nutritional information on product packaging to help make food and drink choices, by country, 2006; Table 4: Consumer survey: agreement with the statement there is too much choice when doing grocery shopping in 15 countries across Europe, Asia Pacific, South America and the US, by country; Table 5: Consumer survey: extent of consumers' available time to read food and drink labels, in 15 countries across Europe, Asia Pacific, South America and the US, by country, 2008; Table 6: Consumer survey: extent of consumers' in-depth reading of food and drink labels, in 15 countries across Europe, Asia Pacific, South America and the US, by country, 2008; Table 7: Consumer survey: the importance attached to diet and nutrition in creating a feeling of wellbeing or wellness, in 15 countries across Europe, Asia Pacific, South America and the US, by gender and country, 2008; Table 8: Consumer survey: level of consumer interest in food label information, in 15 countries across Europe, Asia Pacific, South America and the US, by gender and country, 2008; Table 9: Consumer survey: change in frequency of using nutritional information in the last six months, in 15 countries across Europe, Asia Pacific, South America and the US, by country and gender, 2008; Table 10: Consumer survey: level of consumer interest in food label information, in 15 countries across Europe, Asia Pacific, South America and the US, by age, 2008; Table 11: Consumer survey: the propensity to take active steps to eat more healthily more or less often, in 15 countries across Europe, Asia Pacific, South America and the US, by country, 2008; Table 12: Consumer survey: attention do you give towards the food and beverage proprieties, in 15 countries across Europe, Asia Pacific, South America and the US, by country and gender, 2008; Table 13: Consumer survey: trust in efforts made to ensure safe provision of food and beverage products at the grocery store, in 15 countries across Europe, Asia Pacific, South America and the US, by country, 2008; Table 14: Consumer survey: trust in health and nutritional claims made by food and drink manufacturers, in 15 countries across Europe, Asia Pacific, South America and the US, by country, 2008; Table 15: Consumer survey: perceived user-friendliness of food and drink labels, in 15 countries across Europe, Asia Pacific, South America and the US, by country, 2008; Table 16: Consumer survey: level of consumer understanding of food label health information, in 15 countries across Europe, Asia Pacific, South America and the US, by country, 2008; Table 17: Over 50s nominal population (m) and percentage population by country, Global, 2002-2012; Table 18: Consumer survey: trust in food and beverage products claiming natural or organic ingredients, in 15 countries across Europe, Asia Pacific, South America and the US, by country, 2008; Table 19: Consumer survey: prevalence of choosing fair-trade food and drinks, in 15 countries across Europe, Asia Pacific, South America and the US, by country, 2008; Table 20: Consumer survey: preference for food and drink marketed as 'authentic', 'home-made' or 'original', in 15 countries across Europe, Asia Pacific, South America and the US, by country, 2008; Table 21: Consumer survey: the importance attached to knowing the provenance of grocery items, in 15 countries across Europe, Asia Pacific, South America and the US, by country, 2008; Table 22: Consumer survey: influence of knowing the provenance of grocery items on purchase decision, in 15 countries across Europe, Asia Pacific, South America and the US, by country, 2008; Table 23: Consumer survey: importance of choosing locally-sourced groceries, in 15 countries across Europe, Asia Pacific, South America and the US, by country, 2008; Table 24: National initiatives to outline fruit and vegetable consumption by quotas, by country
List of Figures: Figure 1: Food and drink labeling must serve many purposes as a broader range of influences shape the choices that consumers make; Figure 2: Consumers demonstrate a high level of interest, at least attitudinally, towards label information; Figure 3: Globally, consumers demonstrate a high level of interest, at least attitudinally, towards label; Figure 4: Time poor shoppers often lack time to interpret label information; Figure 5: Many consumers limit their information search when using food labels; Figure 6: Females are more likely to associate diet and nutrition with wellbeing than males; Figure 7: Women are more interested in food label information than men; Figure 8: Young adults are slightly less interested in food label information; Figure 9: A directional shift towards healthy eating is clearly apparent from consumers' perception on their own eating behavior; Figure 10: Labels on food packaging of often the main source of nutritional content; Figure 11: Additional evidence also highlights that consumers are most attentive towards macronutrients such as fats, sugar, and salt; Figure 12: Consumers are most attentive to fat and eating from a diverse range of foods; Figure 13: Though more consumers trust the efforts made to ensure the safe provision of food and beverage products at the grocery store than those who don't, there is considerable ambivalence overall; Figure 14: Consumers are unconvinced by the health and nutritional claims made by food and drink products; Figure 15: A myriad of labeling symbols are competing for consumers' attention and, in some instances, adding to choice complexity; Figure 16: Consumers express only relative confidence in their ability to use and understand food label information; Figure 17: A minority of consumers feel confident they can accurately assess if a product healthy based on label information; Figure 18: Organic claims generally induce more trust than general health or ethical claims; Figure 19: Country of Origin labels often have national-specific variations; Figure 20: Freedom Foods are available in many countries and help to allay worries over animal welfare; Figure 21: Carbon footprints are likely to become the next frontier of food labeling; Figure 22: The '5-a-day' label is one of the easiest to understand; Figure 23: Many organic schemes and logos exist across the world; Figure 24: Ethical products have some of the most consistent labels; Figure 25: The vegetarian society label is also consistent; Figure 26: Labeling must be well executed, easy to understand and based on trust; Figure 27: Graphical instructions have numerous benefits; Figure 28: Target's prescription bottle can act as a benchmark for labeling excellence; Figure 29: Front of pack labeling is thought to be most effective; Figure 30: Five-a-day labels could help more consumers take in healthy nutrients; Figure 31: Clear calorie-controlled product labels should appeal to many consumers; Figure 32: Sensory labeling can have practical and pleasure elements.; Figure 33: Shot codes offer vast untapped labeling opportunities; Figure 34: Health conscious consumers want to know about the products they ingest or topically apply so manufacturers are making greater efforts to be transparent

The Future of Food Labeling: Winning Trust and Maximizing In-Store Appeal

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