Welcome to the Lempert Report LIVE. On today’s broadcast:
Hope you’ve had a chance to check out my multi-part food trends series on Forbes.
Welcome to the Lempert Report LIVE. On today’s broadcast:
Hope you’ve had a chance to check out my multi-part food trends series on Forbes.
Welcome to the Lempert Report Live. On today’s broadcast Conflicted Consumerism puts price ahead of principles, Instacart and Roku team up, is it the downfall of plant-based milks, surprise– what we eat differs from what the USDA says we should, and the new Farm bill might surprise you. On the bullseye Unilever’s latest marketing ploy. I hope you’ll check out my latest Food Trends series on Forbes.com to get there just log on to SupermarketGuru.com. Let’s get started.
:So, Sally, we have this report on conflicted consumerism that comes from the research company Asinia, How to Sell Direct in the age of the Conflicted Shopper. Is their report, new research, 8,000 global shoppers and over 1,000 US shoppers. And they showed that price now tops consumers key considerations for 52% in their buying decisions, followed by value for the money, 44%.
Phil:Yet to spike cost of living pressures over three quarters of American shoppers consider themselves to be sustainably minded in their consumption habits. And that when it comes to the millennials is 85%. So when we look at this conflicted consumerism, they're also saying that 70% of shoppers say they plan to cut back on spending in 2023 due to the economic uncertainty and the reevaluating how and what they buy to minimize their environmental impact. So when I read this, what came to mind is that the real, which is buying and selling used stuff, clothing, pocketbooks, shoes, whatever else, and guilt.com now has more previously owned products than ever before. What do you think, do you think that we're actually going to move more into the secondhand buying? Because this report also found that over two fifths, 38% plan to consume less but more sustainably by purchasing secondhand items in 2023. So it's a real interesting dynamic of what's going on with this conflicted shopper. What do you think?
Sally:Yes, Phil. It is interesting. And I do believe that there are a lot of different values that are coming to mind here of modern shoppers, particularly our younger generations that seem to be more concerned about the planet. They need to be more concerned about carbon emissions as it relates to transporting products. So they're interested in looking at their ordering and delivery habits and how that affects the planet, but also looking at cutting down on waste. And all of this is related to the higher cost of items, I believe, that things have become more expensive, but also, we've started to learn how to minimize our waste and how to do that in a way that actually can make us happy. Social media has made, as you mentioned, the real and the fashion world and secondhand clothing that can be a really hip and cool and fun way to shop for modern lovers of style and fashion. So there are these concepts of using less, are buying less and using more of what we already have is really coming to the forefront of shopper's buy ins, I believe.
Phil:The one part of this survey that was confusing to me is that everything that we've talked about, that these conflicted shoppers want to do better for the environment, they wanna save money and so on. But what they're finding is that the demand for next day delivery is up 73% and 69% said the demand for same day delivery, same day delivery is up. These are retailers that are doing it. So it's sort of like an oxymoron. I wanna take good care of the planet, but get me my delivery today or I'm gonna be upset.
Sally:Yes, we have an addiction to'we want it when we want it'. And that is a hard habit to break. The convenience, especially with technology and what we got used to during the shutdown, has become such a part of our lives that we rely on getting things delivered to us quickly. But what these delivery companies could start thinking about is that these shoppers are looking towards, according to this research, they're looking towards options for electric vehicle fulfillment. 32% said that they would order from those types of companies. So if you are a delivery company thinking about a way to make your transports more planet friendly and to message that to your shoppers, then you might be in a winning situation.
Phil:And it's a great call out to all the supermarkets who have delivery, who are doing it themselves versus doing a third party, yeah. Get electric trucks and vehicles and you'll probably attract a whole bunch of new consumers. Instacart and Roku have partnered. What they're doing, which is really interesting to me, is that Instacart is taking viewership data from Roku, putting it together with the insights from Instacart and basically they're trying to figure out where streamers are purchasing products on Instacart after seeing an ad on Roku. What they found is those who were exposed to a beverage brand on Roku were new purchasers of the brand. They had a 70% higher repeat rate than the average new to the beverage brand buyer on Instacart. So it looks like Instacart really is finally finding its way, and it's not about picking groceries and delivering them, but being a media giant where they're really gonna take over advertising and add another whole level of intelligence to those shoppers.
Sally:Yes, it's a fantastic partnership for CPGs, to find marketing solutions where they can really see a return on their advertising dollars, whether that's coming from TV or from internet ads. They can use Instacart to help them measure that success. What I'm curious about is why on watching TV on Roku, there was a 70% higher rate of repeat buyers for a brand. That's what I'd like to know.
Phil:Yeah, and maybe when you have a subscription service like Roku or Netflix or whatever, Peacock and and so on, you're paying more attention to it because you're paying for it. Maybe that's why? I don't know. I don't know. We'd have to ask Roku. You occasionally consume oat milk, right?
Sally:Yes, I have.
Phil:Yeah, so the price of oak milk is about double the price of cow's milk, and it looks like there's no end in sight that whether it's almond milk or oat milk or soy milk, the prices continue to go up, especially because of the weather problems that we've had with those crops. Especially, here in California where there's this flooding that's been going on from these 12 atmospheric rivers, I think the numbers something like 89 tons of water, has fallen on the state of California since mid-December. So we are gonna see the prices of almonds go up as well as other things. So it looks like, oat milk is gonna continue to rise as all these other plant milks are. And I guess my question is, because there's this article in The Guardian that talks about this food writer who basically has switched from oat milk to cow's milk because of the price. And also what she found is that while oat milk might have the same amount of calories, it doesn't have protein, which gets delivered in cow's milk. And oak milk, they point out,is much more profitable than cow's milk. It takes a lot less to grow oats than it does to birth a cow and own a cow and milk it. We also see the plant milk sales have declined 3.6% in the past year. So I guess my question for you is, are plant-based milks over?
Sally:Well, Phil. There's definitely a big cost difference. In fact, I was looking at Kroger today at the difference between my Kroger here in Nashville. The difference is between dairy milk, a half gallon is$1.99, That's just for regular, not organic milk. And then oat milk ranges all from$2.19, which is the Kroger private label brand, the Simple Truth brand, the oat milk range, and then ranges from$3.79 to$5.99. So that is a very, very big price difference. What I am wondering is when we think about the reasons that people switch to plant-based milks and that is because, one, they could have a dairy allergy, we have 1.9% of Americans are allergic to dairy. Perhaps they're lactose intolerant. The National Institute of Health says that 68% of the world's population is lactose intolerant and we know that that is higher for African Americans and Asians as well. So those are some of the reasons. And then we also have to look at reasons such as animal welfare. Many people are turning to vegan diets and don't want buy any a n animal produced product. So, we've got to still consider that consumer and what they're looking for. But yes, the price difference is so much there that I wouldn't be surprised if people start turning back to the dairy milk.
Phil:Yeah. And when we take a look, it's more than just price. You point out that a lot of people are concerned about sustainability issues and the environment, but let's not forget that the factories that make plant-based milks have a greater environmental impact than those just from milking a cow. And yes, we have methane gas, emitted from cows. That's certainly a problem. But I do think we are gonna see a shift as this price continues to go up, where people are gonna really rethink whether or not plant-based milks, old milk and almond milk are actually worth it when they have to kick over five bucks for a half a gallon versus a$1.99 for cows milk. Talking about nutrients. The USDA has just issued a chart where they talk about the dietary quality of US consumers age two and above. And what they found is no surprise, that we consume more sodium than the recommendation we consume more saturated fat than the recommendation. The surprise for me is that when it comes to total fat, we're about where the recommendation should be. Same thing with calcium. We're really close, but the two deficits are really dietary fiber and iron. And USDA is pretty concerned that what we need to do is we need to beef up dietary fiber and iron. Dietary fiber is an easy one, where you're having whole grains, so that could be solved easily iron. Unfortunately, I think that this is a call to action by our breakfast cereal companies that are loaded with sugar and artificial colors and preservatives and all kinds of stuff where they're gonna put more iron in these breakfast cereals. And frankly, just be promoting it that,'hey, we've got an iron deficiency in this country, buy more sugar coated cereals'.
Sally:Yes. And the dietary fiber and the iron deficits for Americans are of great concern. Those are critical nutrients that we need, and particularly when we look at how much sodium we are consuming, which by the way, Phil, I know you saw in this chart, is much higher. The sodium intake is much higher when people eat in a restaurant as opposed to at home. So that is another thing to consider, but I think there's a great opportunity here for retail dietitians to get involved with their shoppers in their supermarkets and remind them that,'Hey, we are as a society missing out on these nutrients, and so let me help you find things in the store that you can buy that puts more fiber and more iron in your diet and maybe less sodium'.
Phil:Yeah. And the problem with having higher sodium levels, again, it's not using that salt shaker, it's as an ingredient, as a preservative, or for flavor that so many of these foods. Whether it's in a food service operation or prepared meals that we'll get at a supermarket fresh or in the frozen food case, they just have such high levels of sodi um, that we've gotta be careful and soup. We still, I still, go back to the problem that so much of our soups are so high in sodium and when Campbell's soup got rid of sodium because they see the same facts that we do, sales went down because people just didn't like the way it tasted. So we've gotta break this sugar, salt, and fat addiction that we have. And as we've talked about before, starting with younger people and really training their pallets to get away from these addictions are critical. So the New Farm Bill is already being talked about. The next Farm Bill is predicted to cost us 1.5 trillion over 10 years. And there's a lot of discussion this time around with the Farm Bill because about 90% of what's in the farm bill is for the supplemental nutrition assistance program(SNAP), food stamps. So there's a lot of talk in Washington that they want to cut that down. There's 42 million Americans who have to rely on SNAP one in every four kids do. And, and I apologize, it's not 90%, it's 80% of the bill goes for SNAP programs that's up from 76% in 2018. There's also a lot of talk about adding internet access to the rural areas of this country that comes out of the Farm Bill as well. And what they found, which was shocking to me, is that while the government has spent billions to try to bring high s peed internet to the 12 million rural homes that don't have it, a lot of it has been fraudulent behavior where there's, i n the last three rounds of reconnect, reconnect is the Farm B ill's name for rural internet. They've received 3.1 billion over the past three years, and they didn't have enough funding to make it happen. And what they found is they now have to have a new program to really qualify these people who say, oh yeah, g imme money and I'll give you rural internet. But it never got to people. They never did it. So there's a missing 3 billion. I'm sure some of it has been used and efficiently, b ut a lot of them hasn't. Amy Klobuchar from Minnesota, Senator, s aid they are gonna require applicants who get federal funding to deliver broadband, but making sure that they can actually deliver it. So with this Farm Bill, I think that there's gonna be a lot of debate. The other thing that I found really interesting is one t hird of Congress has never worked on a Farm bill before. They've g ot a lot of new members, so they don't understand the Farm Bill and how complicated it is.
Sally:Yes. I thought that was interesting as well, and they will be looking to their more experienced coworkers in Congress to learn how they, they should vote, I assume. But yes, speak to some of the components of this farm bill that you've covered here, Phil. The SNAP portion of this bill is a major, major concern. Particularly with one in every four children being hungry in America, this is a serious concern. in 2018 we had what was put in place the Thrifty Food Plan, which changed the SNAP program to require an additional$12 to$16 per month per recipient, to make sure that they had enough money to actually get a healthy diet, to buy food that was healthy and provided those important nutrients, particularly for children. So that is a major component to this. And also climate solutions. There will be a lot of debate about climate solutions. A lot of farmers would like the help from the government to put in place and implement these new technology solutions to help them make their farms more sustainable. And so we'll see how that plays out. There is controversy because some feel that it opens up an opportunity for more greenwashing, which we have also seen in the industry. So it is important for us all to pay attention to these issues. We've also see that there's a prediction that this may not even come to a vote until 2025.
Phil:It is. The Farm Bill is very complicated and we're gonna watch it very carefully to see what happens. But we can expect a lot of fights, especially over the Snap program as the federal budget comes under much scrutiny with the debt ceiling and the like. Thanks, Sally. On today’s Bullseye– Unilever’s latest advertising tactic is more than just a good idea– it could change the digital ad space and the environment forever. Unilever’s brands– Hellman’s, Comfort and Magnum ice cream is piloting a new program that rewards consumers for watching ads that promote sustainable behavior. Remember that Superbowl ad with Pete Davidson that focused on waste and was hilarious? Little did we know back then that the brand was cooking up game changing advertising. In all fairness, maybe they didn’t realize it at the time either? Or maybe the response was so strong those brilliant marketers decided to push the envelope a bit with this latest campaign that according to the company“sits at the intersection between marketing, technology and sustainability”. Conny Braams, Unilever’s chief digital and commercial officer, told The Drum that“We use short videos to tell sustainable stories about our brands, and then we reward consumers for engaging with it, and what we’ve seen from the pilots that we’ve been doing is that it, first of all, builds brand power, which is really important. But also, it really changes behavior.”. These ads are appearing on social media– Facebook, Instagram and YouTube. Here’s how it works: After watching the videos, viewers are then rewarded and can convert their reward into a coupon or a contribution to a worthy cause, linked to the brand’s purpose. For example, after watching a Hellmann’s ad the viewer could donate to a food waste project. Unilever said it’s seen significant increases in brand power scores in two metrics- meaning and difference- and how positively consumers are perceiving these brands as purpose driven. They also told The Drum that it's seen one of the highest action intent lifts after people watch these ads, with more people feeling inspired to make meals out of leftovers, wash in shorter, colder cycles, re-use plastic and fix and repurpose clothes. This is a perfect example of the kind of innovation that brands need to do in their advertising– rather than just another lame campaign that doesn’t move the needle. Kudos to the Unilever team! Trying to change the world is a great thing– keep up the insights. The Lempert Report is all about inspiring ideas, making our industry think and challenging each other. Let’s think about“being the shopper” and how we can bring our supermarkets and restaurants closer to meet their needs. I hope you’ll come back to join us on next week’s installment of The Lempert report LIVE when we focus on the biggest and best insights– and the things that really matter. Be sure to visit SupermarketGuru.com for the latest marketing analysis, issues and trends and don’t forget to join us back here next Monday at 2:30pm Eastern for more.