Food Trends: Ethical Food Defies Recession

Food trend experts, Innova Market Insights, is reporting that new food and beverage products with an 'ethical platform' are faring better during the recent economic downturns the United States has had.

Data shows consumers who may be saving money elsewhere are including more value-added, ethical foods and beverages in their grocery carts.

Just what is an 'ethical product'?

"Consumers believe that products manufactured with more respect toward animal or human welfare and the environment are worth the extra charge," says Lu Ann Williams, head of Research at Innova Market Insights. "This, in turn, led to a surge in third-party certification from organizations such as FairTrade, Rainforest Alliance Certified and the Marine Stewardship Council."

According to the data, new food products with an ethical positioning, grew from 3.7% in 2008 to 6.0% of introductions tracked in the first quarter of 2011 (as a percentage of total US launches). The data also show the U.S. market accounted for 25% of all new global products tracked with a "FairTrade" positioning [Apr 10-Mar 11]. The past two years have been particularly big for FairTrade products.

"Manufacturers must meet the demands of third party certifiers in order to capitalize on this growing trend and boost their brand image," continues Williams.
What does this mean for food processors? For most it means creating foods with an eye on agricultural practices and sustainable ingredient sourcing.

'Premium' products also seem to weather financial storms fairly well, at least according to more Innova data. The group found that 14.2% of new products tracked during the first quarter of 2011 had a premium positioning, compared to 10.5% in 2010 and up from 8.4% in 2008; when the economic crisis began.

"Recent product launch activity reveals that US manufacturers are not giving up on premium products, despite the uncertain recovery," explains Williams. "Instead, they are aiming to meet the demand for added-value encompassing better quality and offering consumers a momentary escape in stressful times." She concludes that this trend will pressure stagnant brands to innovate.

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