Wednesday, December 14, 2005

Top 10 Food Trends for the New Year

1. Gift cards – Not McPlastic, a trend toward affinity credit cards that I predicted last year, but a very close and lucrative first cousin. The wizards of Oak Brook jumped on gift cards as a Christmas present in lieu of their usual $5 gift coupons. Sonic is offering one at various denominations that top out at an amazingly absurd $100. KFC is aggressively “carding” their customers. Even regionals like Potbelly are into it. Think about it – no fees to pay to the friendly folks at MasterCard; all the cash comes in up front, floating out there no matter how long it takes to use it, and not all the money gets spent when a few of the cards get lost or forgotten.

2. Better bread – Take a look at the honey wheat bread deli sandwiches peddled at Arby’s and the ciabatta that replaced the standard white bread bun on a few sandwiches at Carl’s Jr. Then consider that Panera Bread is one of the hottest franchises in the restaurant business – a QSR cleverly disguised as a fine bakery. You can only do so much with the meat between the bun to differentiate yourself. Sooner or later, you’ve got to get better buns.

3. Sugarless soda/Schizo consumer – Diet drinks now outsell their naturally sweetened counterparts, a strange turn of events when other food products are successfully hyping their “all natural” status. In one of those strange-but-true, Ripley’s believe-it-or-not food moments, artificially sweetened drinks will leap into grocery carts and land right next to the high-priced but all natural Niman Ranch dry aged prime rib.

4. All Natural/Organic – It doesn’t matter that those two terms have almost no meaning. Eating all natural and/or organic just sounds like the right thing to do to the upcoming Generation X (or are we at Gen Y or Z, now?). Beginning with all natural beef, pork, breads, and soft drinks, the shopping list rolls on forever. There are even a few “All natural, organic” sodas out there, a kind of nutritional two-bagger. Maybe it’s a Grape Nehi tasting product that bubbles up out of a hidden spring in some exotic wine growing district in the south of France? Here’s the catch: The phrase "all natural" can mean just about anything; it has no nutritional meaning whatsoever and isn't well-regulated by the FDA. Organic is only slightly more defined.

5. Tea time – It’s the new coffee. Here’s proof positive: Starbucks peddles Chai, a tea-based dairy drink laced with ginger, honey, vanilla or whatever you can find in the spice drawer that sounds half decent. Lots of start-up soft drink companies are using tea as a flavor base and a few bleeding edge chefs even use it to spice up their recipes. Can old-fashioned tea rooms with china cups and doilies be far behind?

6. Feeding the old folks – Baby boomers will officially stop being babies and start entering their golden years in 2006. These erstwhile hippies never intended to grow old and don’t ever plan to die. Ponce de Leon is their patron saint and the holy ground is the Fountain of Youth National Archaeological Park in St. Augustine, Florida where many seek Botox laced holy water. They will demand pharma-foods that will help them live longer, healthier lives and the food industry will come to their aid with thousands of products, further annoying the FDA with a few hundred specious health claims. I can’t emphasize this enough – this is a HUGE and rapidly growing market with an incredible amount of discretionary income.

7. Burping the babies – Feeding the old folks will be nicely balanced with feeding the youngest folks. We’ve never skimped on our children, even spending as much as $900 for a Cameleon stroller complete with independent suspension and hand-actuated parking brake. With wretched excess like that, is $8 for a jar of baby food containing 4 ounces of all natural fruit gelee out of the question? I think not. (At those prices, it ain’t jelly anymore!)

8. Mass quantities – It started in 2005 when Burger King and Hardee’s said to hell with healthy. “We’re feeding our core audience what they want, not what they need.” Young men responded with their lunch money, buying half pound mega burgers and wolfing them down in the back seat of their King cab work trucks on the way to the job site. With sales successes like that, everybody will jump on this massive market. The big question won’t be “How many calories?” Lots of consumers ask “Will it fill my big belly?”

9. Fruitarianism – Vegetarianism is old school high school. It’s gone mainstream. It’s something last year’s senior class did. Up-and-coming high schoolers, looking for a way to stand out in the crowd, will start to move away from a vegetarian diet which was THE thing to do in the first half of the decade. An all fruit diet – apples, pears and exotica like star fruit and cherimoya – that’s the ticket for the second half of the decade.

10. GI diets – No, we’re not talking about military foods and MRE’s. We’re talking glycemic index which was developed to help control glucose levels in diabetics. High GI foods result in a greater increase in blood glucose levels. Low GI foods, such as nonstarchy fruits and vegetables, beans, and dairy products, produce a smaller rise in blood glucose levels. It’s simple, it works and you can really lose weight with it. With type 1 and type 2 diabetes among the most rapidly growing health problems, especially among our aging population (see #6 above), there is a big, built-in audience for GI diets.

Sunday, December 04, 2005

Going main stream, organically speaking

While reading this, forget for a moment that “organic” is an ill-defined term and the Organic Trade Association’s just released research report is admittedly biased. The Association’s prediction of a bright future for organic meat, dairy and other products probably hits somewhere in the rough neighborhood of the truth. But their conclusion is based on a too-narrow survey of closely allied industry research organizations and long-time member companies.

Here are a few of things the Association sees by 2025 in their slightly tainted crystal ball:

  • Recognizing that their current huge growth rate is based on a small base which makes their current impressive 20% annual increase a not-so-difficult achievement, they forecast slower sales increases over the next 20 years.
  • By 2025, 14% of the average U.S. household's budget will be devoted to purchasing organic products.
  • The average consumer household in 2025 will buy some organic products on a regular basis.
  • Organic products will be sold everywhere by 2025 and increased food sales in restaurants can be expected.
  • In one of their shakiest predictions, they claim younger shoppers will continue to be interested in organic foods, particularly as Gen Xers pass down their belief systems. Let’s be honest about this “maybe/maybe not” statement. Every generation chooses its own prejudices. Gen Xers will try to pass on their “truths” to their children; the kids will take it with a grain of salt and do their own thing.
  • Ethnic shoppers, including Asian-Americans and Hispanic-Americans, will continue to be more likely to buy organic than the general population; a term that’s a generally accepted code for Caucasian, an ethnic group that will also be a hyphenated minority in 2025.
  • Increases in organic sales will result in increased U.S. organic farm acreage and, in a plea to future generations of politicians charged with pork barrel politics,
  • Government support of organic agriculture will be crucial to maintain the industry's growth potential. Looking at the decreasing supports and entitlements in the current version of the Ag Bill, OTA has some serious long term lobbying ahead.

In 2025, organic meat, dairy products, alcohol, and "stage of life" foods (those consumed during pregnancy, nursing, infancy, puberty, and senior years) will be most popular, according to survey respondents. The current buzz word for most of these products might be “neutraceuticals,” foods that are supposed to help remedy real or imagined health problems or to fit special “stage of life” nutritional requirements.

Because hectic lifestyles will continue to be the norm, OTA predicts convenience, ready-to-eat and prepared foods will proliferate. Personally, though, I’m having a problem accepting the idea of organic prepared foods. The concept strikes me as an oxymoron. Survey respondents also predicted growing interest in organic items that mimic conventional food brands and in organic products perceived by consumers as providing health benefits

Survey participants predicted that shopping for organic items will be commonplace in 2025, and it will no longer be considered on the fringe to "go organic." From certified organic cream-filled snack cakes (Little Debbie, are you listening?) to pet foods and edible packaging, most products might have an organic version 20 years from now.

2005 Survey participants included the Natural Marketing Institute, Nutrition Business Journal, Organic Valley, Packaged Facts, Smucker Quality Beverages, SPINS, Stonyfield Farm and The Hartman Group. A complete copy of the study is available online at www.ota.com/pics/documents/Forecasting2005.pdf.

Download the report and read it with skepticism. After factoring out the way too obvious prejudices, you’ll still learn a lot about the future of food.

Happy Holidays.