The same demographic changes that are repainting the American portrait are having a great impact on food and beverage products. The middle class is shrinking, and so is the average household size. New waves of immigrants are bringing new cuisines, and at the same time millennials are seeking new dining adventures.
Food-related demographics from the Hartman Group (www.hartman-group.com) suggest there is no longer a "generalizeable" American family. "The American household is undergoing dynamic changes. Ours is now a melting pot of cultures, ethnicities, beliefs and values, and America's households have come to reflect that diversity," the research firm stated in a September article.
"The new household structure reflects profound alterations in a variety of demographics, such as who we are, who we live with and where we live."
Food and beverage processors use such demographics to find out what ingredients and formulations they'll need as food preferences continue to evolve. And their marketing departments reshape company strategies based on revised and emerging ethnicities, ages and household sizes. For food and beverage companies, the challenge has never been greater in predicting which products will have enough appeal to gain mainstream acceptance. Already, they're adjusting for a variety of diets to offer something for everyone.
The new normal
The traditional family structure of a married heterosexual couple with children is no longer accurate, Hartman Group points out; nor will it ever be again. Most households today are child-free. Those with families now live in less communal households, driven increasingly by the whims of individual desire, not family routine. "And if any single thing defines family structures today, it's diversity, and the fundamental lack of any one dominant type of family structure is emblematic of the new normal," Hartman research points out.
Women's roles in the labor force, including leadership positions, have grown dramatically, notes Pew Research Center (www.pewresearch.org), Washington. More women have joined the workforce over the past 50 years, and men's and women's domestic roles have changed dramatically with an impact on behaviors, including shopping. Mothers became the sole or primary breadwinners in a record 40 percent of all households with children in 2011, adds Pew Research.
The reaction from food and beverage companies has been to consider at least some marketing to men, who often do the shopping, and to plan on shoppers making more but smaller trips to the store. And food companies have been increasingly building-in convenience to help busy people get meals on the table quickly and easily.
Pew Research also finds the share of adults who have never been married at an historic high, as is eating alone, which has steadily increased to the point that it comprises almost half of all eating occasions. How old are we? Most of us (66.2 percent) are between 15 and 64, while 19.4 percent are 14 and under and 14.4 percent are 65 and over, census figures show.
The ends of the income spectrums are growing, while the middle class is dwindling, and has been since the 1970s, Pew Research notes. The middle is down to a 43 percent share of the U.S. household income versus 62 percent in 1970. Consequently, the buying power of upmarket consumers and their influence on food trends and culture overall is growing. The move to quality, premium experiences is increasingly influential.
Familiar foods and beverages in large volumes for the lowest possible price are being replaced with "premium" foods, Hartman's A.C.T. (anthropology, culture, trends) forecast says. "People will pay more for higher-quality food and beverage experiences on everyday occasions," the forecast says. That's one reason the large, mainstream food companies are buying emerging brands in the premium space.
Immigrants and their U.S.-born descendants are expected to provide most of the population gains in the decades ahead. Hispanic and Latino Americans accounted for 48 percent of the national population growth of 2.9 million between July 1, 2005 and July 1, 2006, according to the Census Bureau. Much of this change has been (and will be) driven by immigration. Nearly 59 million immigrants have arrived in the U.S. in the past 50 years, mostly from Latin America and Asia, Pew Research reports.
Economic growth is being driven by Hispanic and Asian consumers, to the tune of nearly $2 trillion per year, according to the Selig Center for Economic Growth at the University of Georgia (www.terry.uga.edu), Athens, Ga. "The biggest change I've seen is the increased focus on Hispanic estimates after Census 2000," explains Jeff Humphreys, Selig Center's director. "That was a wakeup call to corporate America. Many companies found they were behind in terms of targeted market efforts to Hispanic consumers."
But that's subsiding. Hispanics currently comprise about 47 percent of U.S. immigrants, but since 2007, immigration from Latin America has declined, especially from Mexico, according to Pew Research. Now the Asian population is the fastest growing, set to become the largest annual immigrant group in the U.S. sometime between 2045 and 2055, according to Pew research. However, Asians will barely make it into third place in the total population by 2065, comprising 14 percent of the full American melting pot. "There are just more Asian consumers [in the U.S.] now, and their buying power has held up better than that of other groups," Humphreys adds.