Gourmet, Specialty and Premium Foods, Beverages and Consumer Trends in the U.S., 8th Edition

The conventional wisdom goes that gourmet/premium foods fare well during economic downturns because consumers view them as “affordable luxuries.” But the “Great Recession” of 2008-2009 disproved this theory as mighty Starbucks, the bellwether for the democratization of luxury, was among the first companies hit by cutbacks in consumer spending. For the market overall, Packaged Facts conservatively estimates that total U.S. retail sales of gourmet/premium foods and beverages through all retail channels rose to $67.1 billion in 2009, an increase of 3.7% over the previous year’s sales of $64.7 billion compared with the 2005-2009 compound annual growth rate of 8.7%.

Still, success remains to be had, and many gourmet/premium marketers and retailers are succeeding by finding ways to respond to the economic slowdown not by ignoring it or reversing strategy, but by incorporating its impact on consumer behavior as a factor among others. This new report from Packaged Facts is an indispensible tool to this end, answering such questions as: Which gourmet/premium products and market segments have been faring well in the new economy? How are marketers and retailers adjusting? How can they recast and reposition their goods? Who are the most viable consumers, and how can they best be reached? Which media and marketing messages resonate for these consumers, and in what contexts?

Gourmet, Specialty and Premium Foods, Beverages and Consumer Trends in the U.S., 8th Edition also pinpoints market size, analyzes growth potential and identifies issues and trends that will affect the marketplace through 2014. Focusing on consumer lifestyles and demographics through extensive analysis of Experian Simmons panel data, the report examines their attitudes and behaviors toward gourmet/premium foods and beverages, retail shopping patterns, and media usage and preferences, both traditional and social. Also included is extensive coverage of new product trends and marketing and advertising positioning, all discussed within the context of the social, economic, and psychographic drivers of current consumer behavior.

Additional data sources include SymphonyIRI Group sales tracking of selected products and brands through tracked mass-market channels; Datamonitor’s Product Launch Analytics data tracking new product introductions; and proprietary data from Packaged Facts’ own consumer survey, which is based on a national online poll conducted in May/June 2010.

Market Insights: A Selection From The Report

One in Five U.S. Consumers Seeks Out Gourmet Products

According to the survey, one in five U.S. adults (20.0%) seeks out gourmet products when food shopping, including 5.0% who agree strongly with the statement, “When food shopping, I seek out gourmet products.” Another 22.0% are noncommittal about the statement and 57.0% somewhat (26%) or strongly (31%) disagree. The 20.0% who agree that they seek out gourmet products when food shopping in the Packaged Facts survey is slightly higher than the 17.5% of respondents to Experian Simmons’ Fall 2009 survey who agree that “I try to eat gourmet food whenever I can” (17.5%), although strong agreement is slightly lower, at 5.0% in the Packaged Facts survey vs. 5.8% in the Experian Simmons survey. A surprising 30% of consumers are willing to pay more for gourmet food products, according to the Packaged Facts findings, including 6% who strongly agree with this statement.

Beverages the Largest Product Classification

According to NASFT data, the single largest specialty food category at retail is cheese, representing almost 11% of total specialty food and beverage dollar sales, followed by condiments (8%), frozen and refrigerated meals (5%), and chips and snacks (almost 5%). However, beverages—including juices, functional drinks, coffee, tea, bottled water and other drinks—collectively account for more than 12% of total dollar sales. The NASFT category sales data excludes sales through Walmart and Trader Joe’s, as well as “price-look-up” (PLU—i.e. non-scanner) items such as prepared foods, meat/poultry/seafood, and bakery products (NASFT: ibid).

Examining the entire gourmet/premium food and beverage spectrum through all retail channels, Packaged Facts calculates that beverages (including bottled water and refrigerated juices in the dairy case) comprise the largest classification, accounting for 34% of retail dollar sales in 2009. In second place is the baked goods (including cookies, crackers, breads and sweet baked goods) pasta, and grains classification, representing 14% of sales, with the meat/produce/seafood and produce departments combined a close third at 13%, followed by prepared foods contributing 10% of gourmet/premium dollar sales. [Table 2-2]

Specialty Foods The Foundation of Food Gifting Despite Challenging Economy

Packaged Facts’ new market research report, Food Gifting in the U.S., 2nd Edition (August 2010) found that specialty foods are the foundation of food gifting in the United States, which has helped the industry expand sales and product offerings in a challenged economy where few other areas of gift-giving have found success. Packaged Facts estimates the overall market for gift-giving in the U.S. increased...

Gourmet/Premium Food and Beverage Marketers Still Reaching Consumers

New York, September 8, 2010 — Consumers with caviar tastes but recession-induced tuna budgets are still finding reasons to purchase gourmet products, helped in part by savvy product introductions and marketing techniques from gourmet food purveyors, according to Gourmet, Specialty and Premium Foods, Beverages and Consumer Trends in the U.S., 8th Edition by market research publisher Packaged Facts. Approximately 20% of consumers seek gourmet products and a surprising 30% of consumers are willing to pay more for gourmet food products, according to the report.

“Consumers who are passionate wine lovers do not switch from Chateau Lafitte Rothschild to jug wine because they are down on their luck. Instead, they start combing wine stores for the many excellent vintages that cost $10 a bottle or less. Likewise, consumers who have acquired a sophisticated taste for specialty coffee are not going to settle for cheap ground coffee, although they may have to make some tradeoffs to stay within their budget, even if that means forsaking their favorite coffeehouse drinks every morning,” says Don Montuori, publisher of Packaged Facts.

Marketers, retailers and foodservice providers that are succeeding in this environment are finding ways to respond to the economic downturn—not by ignoring it or reversing strategy, but by incorporating its impact on consumer behavior. For example, with more consumers cooking and eating at home, retailers can recapture food dollars from the restaurant industry, which currently accounts for about half of consumer spending on food and beverages. It is also an opportunity for gourmet/premium food and beverage marketers to develop tantalizing restaurant-quality products that help culinary-aware consumers bring the restaurant experience home.

Such visionary exploits by industry players helped total sales of gourmet/premium foods and beverages through all U.S. retail channels increase 4% to more than $67 billion in 2009, compared to sales of $65 billion the previous year. Packaged Facts projects the market will approach $87 billion within the next five years with a compound annual growth rate (CAGR) of 5%. During the 2010-2014 period, the positive upscaling factors that are being dragged down by the still weak economy will gradually regain the upper hand, causing annual growth to rise from 4% in 2010 to 7% by the end of the forecast period.

Gourmet, Specialty and Premium Foods, Beverages and Consumer Trends in the U.S., 8th Edition pinpoints market size, analyzes growth potential and identifies issues and trends that will affect the marketplace through 2014. Focusing on consumer lifestyles and demographics through extensive analysis of Experian Simmons panel data, the report examines their attitudes and behaviors toward gourmet/premium foods and beverages, retail shopping patterns, and media usage and preferences, both traditional and social. Also included is extensive coverage of new product trends and marketing and advertising positioning, all discussed within the context of the social, economic, and psychographic drivers of current consumer behavior.

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