In today’s newsletter:
What is Healthy? Consumers are confused by nutrition
The Power of Solo: How Single-Person Households are Altering the Industry
Radical Pickle: Thinking to the Edges of Your Portfolio
Grocery Wars: The Big Guys Play to Their Strengths
Tidbits: Quick links to fun food news
Did you miss the last newsletter? Find it here
The Nutritional Fog of the American Consumer
Campbell’s launched two new gluten-free SKUs into their creamy condensed lineup. Long the workhorses of casseroles and hotdishes across the US, the iconic portfolio now has gluten-free Cream of Chicken and Cream of Mushroom.
Banquet, a ConAgra brand, has added a new SKU to its Mega Crustless Pizza lineup. The Three Cheese version contains mozzarella cheese, sauce, beef, sausage and pepperoni and comes in at 28g of protein per serving.
Nut and seed butter brand Mixed Up has launched a new Everyday Seed Butter: Sunflower Pepita Crunch. The nut-free, dairy-free and vegan butter contains “sunflower seeds, pepitas, unrefined coconut sugar, and vanilla extract.”
Smoothie and nut butter snack company Sweet Nothings and skin-on dried fruit company RIND Snacks have joined forces to create a limited-time, co-branded snack. The plant-based snack pairs the Nut Butter Bite line from Sweet Nothings with RIND's Chewy Straw-Peary Dried Fruit. The seven-ingredient snack includes organic dates, peanut butter, organic oats, strawberries, pears, organic flax and sea salt.
GoodPop, a brand known for its organic frozen desserts, is now entering a new category with a line of sparkling juice drinks for kids. The brand is introducing Mini Cans that contain only real fruit juice (23-30%) and sparkling water. Flavors include Lemon Lime, Fruit Punch and Orange.
Organic cracker and cookie brand Simple Mills is launching a new line of crackers called Pop Mmms made with veggie flour. The bite-sized crackers are made with butternut squash and red bean flour. One serving of crackers is ½ serving of vegetables.
UK company SRSLY Low Carb has launched a line of ready meals. Originally known for their low carb breads, wraps and rolls, the company has recently branched out into pizzas and now prepared dishes with the launch of five vegan meals. Each meal comes in at around 300 calories and contains 15g carbs. Varieties include: Chick'n Chow Mein Noodles, Chick'n Teriyaki Noodles, Chick'n Pad Thai, Vegetable Thai Red Noodles and Chick'n Mexican Rice.
January AI, a metabolic health company, has unveiled a generative AI-powered application that can estimate and predict an individual's glucose response to various foods and drinks. January AI's app forecasts the potential impact of an individual’s food consumption on future blood sugar levels based on past responses. In addition, the app can track a user’s macros, fiber intake and provide ‘nudges’ for better eating.
So What? Last year, McKinsey published a study that highlighted an interesting consumer paradox. The four-country study (US, UK, France, and Germany) found that, while 70% of consumers said they were committed to trying to eat healthier, around 50% said they didn’t really know what healthier meant anymore.
We really shouldn’t be surprised. Just like any other form of news today, the overabundance, ubiquity and social media filtration of information on health and nutrition has muddied the waters. Once the sole domain of your doctor or government recommendations, nutrition information is now hurled at us from Buzzfeed articles, influencer posts, and product ads.
The veneer of certainty regarding what constitutes ‘healthy eating’ has fallen, replaced by an ever-changing onslaught of contradictory blurbs informing the public that “X is good” or “X is bad.” Not to mention that much of the nutrition information that people see today comes from brands, or at least people with an agenda, leading to skepticism around how much can actually be trusted.
I believe that it is this nutritional uncertainty that is driving much of today’s health food trends. Faced with ambiguity about the ‘right thing’ to eat, and lacking a trusted advisor, consumers are instead making up their own rules. Contrary to the nutritional dogma they see around them, these rules are extremely simple and easy to use in their daily lives. To date, I’ve categorized five self-styled nutrition plans:
Back to Basics: This is a return to the ‘simpler’ days when the rules about nutrition were straightforward (think 1950’s health class). Eat your vegetables, drink your milk, get your five a day. There is a ‘if it was good enough for my grandparents’ mentality that resonates here.
Betting the Field: If you follow enough nutritional pop culture, you’ll notice that every week a new ingredient takes the spotlight as the ‘healthiest.’ While many consumers originally jumped on this bandwagon, making kale and quinoa hot, lately we aren’t seeing one specific ingredient becoming the ‘it’ ingredient. Instead, mixes are winning. So, instead of placing your bet on one nut, fruit, or bean being the healthiest, we are seeing products offering a combination.
One and Done: All these plans are simple, but this one is probably the simplest. This program has one overarching rule when it comes to eating healthy. That could be seeking to reduce something (often sugar or carbs) or adding something (often protein), but that’s it. It makes deciding on a meal or a snack easy, just look for your ‘one thing,’ compare it to other options, and eat.
By the Book: This plan is fading, but it still exists. It outsources a way of eating to an expert or movement. So whether it’s Keto or DASH, if the program says you can’t eat it, it’s out. The reason it’s difficult for people to keep to this type of plan is that they are much too complex. Measuring net-carbs or looking up the type of fruit you can have introduces too much friction into people’s lives. The only time it works well is with packaged foods that are labeled (e.g., keto-friendly), and these are always a premium.
Personalized? There has been much talk about this one, but it hasn’t really materialized yet. However, in theory, it should be the next big thing. As AI progresses and becomes prominent on our devices, having a system that can gives a thumbs up or thumbs down to every food choice seems like the simplest option there is. However, I’m still skeptical. The interface needs to be seamless, if people have to enter any info manually, it’s dead-on arrival. However, even if that gets solved, personalized nutrition still needs to address the biggest sticky point: the lack of a ‘cheat factor.’ If you look back at all the personal diet plans above, their charm is in their ability to be adjusted in the moment by social or physiological needs. People like a system that has enough focus to force them to eat better (“I should probably eat a vegetable today”) but also allows for some cheats (“Carrots in the carrot cake count as a vegetable, right?”). The only way I can see nutritional AI working is if it was situationally flexible (“I see you are at a party, have fun, eat some dip, I’ll see you on the other side!”).
Smaller Households are Changing the Food Industry
Cornhusker Kitchen introduced Duck Fat Spray at the recent Summer Fancy Food Show. The company claims that this is the only duck fat spray available in the world. The spray provides the flavor and cooking properties of the coveted fat (20% less saturated than butter), in a convenient form.
Orlando-based produce company Spice World is introducing jarred chopped and ready-to-easy onions, called Easy Onion. The new 16-oz jar is an addition to the Easy Onion portfolio of squeezable chopped onion pouches.
Craig’s Vegan Ice Cream is introducing new mini-cups. The new 3.6oz cups are available as 6-packs in five of Craig’s most popular flavors: Perfectly Chocolate, Kursten’s PB Crunch, Melrose Mint Chip, Killa Vanilla, and Sunset & Strawberry.
Canned seafood company Siesta Co has launched new Tuna Belly in Olive Oil. The product also contains the Japanese seasoning yuzu koshō, which “adds a bit of acidity and subtle spice to the tuna belly.”
Mars announced that they are acquiring the refrigerated sous vide meal maker Kevin’s Naturals for an undisclosed sum. Kevin’s, which has been growing at double digits since its founding in 2019, will remain a separate business, Mars stated.
Planters, a Hormel company, is launching a new Dill Pickle flavor as part of their new Cashew line. The new flavor joins two other varieties, Rosemary Sea Salt and Cinnamon and Brown Sugar.
So What? Two separate pieces of information hit my news stream last week that seemed interconnected. One was mainstream media getting hold of the TikTok trend of ‘girl dinner,’ which if you haven’t seen it already, is basically a snacking plate made up of seemingly random kitchen items. People criticized it as a new low in bad eating, others felt it was just overblown media hype of an ever-present trend, and some fast movers took advantage (Popeye’s introduced a ‘Girl Dinner’ on their online menu). The second piece of news was that America hit a new record for the number of single-person households. Today, 30% of all households are made up of only one person.
As our households shift, so does our eating patterns. While on the surface this seems like a banal insight that requires only packaging innovation (e.g., smaller loaves of bread), the truth is far more expansive.
The US food industry came of age during the 1950s and ‘60s, the literal boom in the Baby Boom. The CPG giants in place today made their bones with products, marketing and advertising targeting the nuclear family. The silent infrastructures of these companies are built on multi-person families, so the move to single (or even dual) person households is a big deal.
The ramifications of small households to the food industry are often not immediately obvious as such, instead we label them ‘cultural changes’ or ‘social media trends.’ However, as younger generations stay single longer and empty nesters age in-place, we must recognize the force this imposes on the industry:
More Experimental Flavors: When you are living with someone else, you must find a ‘happy medium’ of flavors. While you might like hot Thai food, your partner might be more into meat and potatoes. So, you compromise. But if you’re single, you can explore on your own terms and likely seek out more exotic flavors. This means we will be seeing a greater interest in purchasing and experimenting with new products and new flavors in the future.
Stronger ‘Health Trends:’ When you diet, you diet alone. Dieting is isolating because you must eat differently than those around you. That’s why dieting in a family setting is so hard to maintain. However, when you are single, you only buy for yourself, so you can be keto, vegan, or grain-free without compromise. Therefore, the depth and breadth of unique diets and health lifestyles will continue, and likely grow. Singles can maintain these diets longer, making products created for them more sustaining at shelf.
Faster, Convenient, Snack-Like Meals: Cooking for kids is mandatory (i.e., you are responsible for their nutrition) and cooking for your partner can be fun. However, cooking for yourself is often seen as unpleasant and unnecessary. This is why takeout and delivery, and the rise of delivery apps, have been forecast to grow (depending on where the economy takes us). For CPG, this means we’ll need more convenience in the kitchen and meals that taste like a restaurant, but at the same time, eat like snacks. The Mars acquisition of Kevin’s is telling. If a snack food company can snack-ify restaurant quality sous vide meals, it opens millions in potential revenue!
Demand for More Social Connection with Food: For humans, food and eating are social. While we can and do eat alone occasionally, there is a natural inclination to come together to break bread (the word ‘companion’ literally means “one you break bread with”). Therefore, in a society that increasingly lives alone, we should expect to see more venues pop-up that celebrate social eating. That’s one reason I think we are seeing more activity restaurants, places like Flight Club (food, drinks, and darts), Chicken n’ Pickle (food, drinks, and pickleball), and PuttShack (food, drink and mini-golf). Even at less gamified restaurants, we’ll see more reasons for people to stick around and socialize. Can CPG incorporate socialness into their products?
Smaller and Greener Packaging: The future is smaller packaging. Yes, because people living in 1-2 person households need less, but also because their dwellings tend to be smaller. However, all that small packaging also means more packaging, so there will be a push to make boxes, cans and trays more recyclable. The challenge for CPG companies will be balancing their margins in the smaller packaging world. Is it about refillable containers, bundling strategies, or packaging production efficiency?
Brands I’m Watching
Sparkling canned wine cocktail company Spritz Society is launching a limited-edition pickle cocktail in partnership with Claussen. The 8.4-ounce cans, containing white wine and a pickle flavor, contains 6% ABV and 120 calories. Currently they are sold out online.
So What? For April Fool’s Day 2022, Spritz Society announced on their social media feed that they would launch a pickle-flavored cocktail. However, what was done for laughs quickly spurred a stream of DMs from consumers asking for it to actually happen. The company recognized that, beyond being a trending flavor (see Planter’s Dill Pickle Cashews elsewhere in this newsletter) the salty, briny, vegetal punch of pickles wasn’t that far off from other popular cocktail additions (see olives and Bloody Mary’s).
The lesson from this story is that you need to play the edges of your innovation portfolio. While a startup must deliver safe flavors first, and they’ll always be the profit engine, it’s the radical edges that create the most buzz and trial for your core. Be willing to be radical, even if its an LTO (or especially if it is).
German-grocer Lidl closed 11 stores in the US in the last 11 days. The company says that the closures are due to underperformance. Also, last week, Whole Foods announced that they would be rolling out Amazon One across all their retail locations by the end of the year. Amazon One is a biometric identification and payment method where the customer only needs to hold their palm above a reader to pay for their groceries (through their Amazon account). Lastly, Walmart announced they are offering ½ price discounts on their Walmart+ subscription service for those on government assistance (Walmart+Assist). Walmart+ provides free shipping and grocery delivery, nationwide gas discounts and video streaming with Paramount+ for members.
So What? The grocery business is heating up! While spending at grocery stores rose slightly in June (1.1%), sales were down 0.7% compared to June of 2022. Even with inflation in the US now lower than 5%, consumers are still feeling the pinch. This doesn’t bode well for grocery retailers who are looking to increase sales and maintain customer loyalty for whole cart shopping. Lidl and other discounters are in an especially tough position due to their cut-rate deal business model making their margins esecially thin.
That’s why Amazon/Whole Foods and Walmart are playing to their strengths. Yes, Amazon has courted lower income consumers before, and Walmart has experimented with tech-driven offerings, but neither has signicantly moved the dial in terms of gaining significantly more new customers. Amazon’s entire business model rests on lower friction and the aquisition of more customer data, and this integration of Amazon One into Whole Foods will accomplish both goals. Similarly, Walmart’s move to include those on assistance in their Walmart+ program at half-price is exactly what they need to due to prevent further exodus of these consumers to dollar and discount.
TIDBITS
Taco John’s gives up on ‘Taco Tuesday’ trademark after pushback from Taco Bell and Lebron James, but issues charity challenge
Kellogg’s Bare Naked aligns with nudists, celebrates National Nude Day and helps consumers find naked-friendly hiking spots
Summer is here! This map shows Dairy Queen’s dominance in the US (except for pockets of regional ice cream favorites—e.g., sweetFrog, Culver’s)
A recent YouGov survey found that the most popular beer in the US is…not the one you’d think
Speaking of beer, the pub from the movie The Banshees of Inishirin has been rebuilt and is open for a pint (no word on the presence of a donkey or the policy around throwing fingers at people)
Did you know that Singapore has had Norwegian salmon ATMs since 2019!?
Chipotle is testing a robot named Autocado that makes fresh guacamole for its stores
A man in the UK ordered a £500 laptop from Amazon only to be sent two boxes of Weetabix taped together!
An Oregon brewery is using their beer by-product to help young salmon remember where to return to when they spawn